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The Contribution of Management Control Systems to Environmental Capabilities

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  • Elisabeth Albertini

    (IAE Paris - Sorbonne Business School)

Abstract

A growing number of companies are implementing proactive environmental strategies with the objective of gaining competitive advantage through an enhanced reputation, the reduction of production costs and a first-mover advantage in the green product market. Yet according to the natural-resource-based view, the development and maintenance of unique and valuable environmental capabilities are the central elements allowing companies to gain financial benefit from their proactive environmental strategy. In this context, management control systems can contribute to the development of environmental capabilities by focusing attention on strategic priorities and stimulating dialogue. Through a single case study, and building on Simons' (1995) four levers of control, we propose a conceptual framework of management control levers that show how companies can enhance (1) stakeholder integration capability through the joint use of belief, boundary and diagnostic control systems; (2) shared vision capability through the joint use of the belief and boundary systems; (3) organizational learning capability through the use of interactive control systems and to a lesser extent diagnostic control systems; and (4) continuous innovation capability through the use of interactive control systems, belief systems and to a lesser extent diagnostic control systems.

Suggested Citation

  • Elisabeth Albertini, 2019. "The Contribution of Management Control Systems to Environmental Capabilities," Post-Print halshs-02007194, HAL.
    • Handle: RePEc:hal:journl:halshs-02007194
    DOI: 10.1007/s10551-018-3810-9
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-02007194
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    Cited by:

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    2. Dongxiao Wu & Xinzhong Bao & Qiulan Su, 2023. "From Green Ideas to Green Savings: Assessing the Financial Impact of Green Innovations on Audit Fees," Sustainability, MDPI, vol. 15(14), pages 1-15, July.
    3. Nuraddeen Abubakar Nuhu & Kevin Baird & Sophia Su, 2023. "The impact of interactive and diagnostic levers of eco‐control on eco‐innovation: The mediating role of employee environmental citizenship behaviour," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(2), pages 2245-2271, June.
    4. Edward T. Vieira, Jr. & Susan Grantham & Susan D. Sampson, 2021. "Corporate Social Responsibility and Its Reporting From a Management Control System Perspective," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 19(2 (Summer), pages 127-144.
    5. Colin B. Gabler & Omar S. Itani & Raj Agnihotri, 2023. "Activating Corporate Environmental Ethics on the Frontline: A Natural Resource-Based View," Journal of Business Ethics, Springer, vol. 186(1), pages 63-86, August.

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    management control systems; proactive environmental strategy; natural-resource-based view;
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