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Factors that determine the level of environmental engagement of European companies: what are we doing wrong?

Author

Listed:
  • Léopold Djoutsa Wamba
  • Joséphine Florentine Mbaduet
  • Jean-Michel Sahut
  • Lubica Hikkerova

Abstract

This study analyses the role of a company's financial capacity and governance in improving its level of environmental engagement. The methodology used is based on applying regression analysis to panel data on 351 listed large European companies during the period 2007-2015. Firstly, the results show that the companies in the sample are fairly engaged in environmental protection with strong dispersion. Furthermore, it revealed that the financial capacity of a company has a significant effect on its level of engagement in environmental protection. Lastly, the results also show that a better quality of governance plays an important role in the decision to undertake actions leading to environmental protection. More specifically, the degree of management implication in the running of the business, the respect shown for shareholder rights, the effectiveness of the control exerted by the board of directors and the independence of the audit committee are the most important determining factors of environmental engagement.

Suggested Citation

  • Léopold Djoutsa Wamba & Joséphine Florentine Mbaduet & Jean-Michel Sahut & Lubica Hikkerova, 2022. "Factors that determine the level of environmental engagement of European companies: what are we doing wrong?," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 47(2/3), pages 404-430.
    • Handle: RePEc:ids:ijesbu:v:47:y:2022:i:2/3:p:404-430
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