Content area
Full Text
Introduction
Concern for the protection and preservation of the natural environment is strong among a sizable segment of the U. S. population. "Green" initiatives exist in many walks of life, and business organizations are asked or expected to be more environmentally responsible than in the past. Indeed, a strong positive environmental stance may be viewed as a competitive strength as firms seek to position themselves vis-a-vis their competitors. According to the International Standards Organization (ISO) and for the purposes of this paper, "environment" is defined as "surroundings in which an organization operates, including air, water, land, natural resources, flora, fauna, humans, and their interrelation. The environment in this context extends from within an organization to the global system". (Jackson, 1997, p. 128). Environmental concern is defined as the importance individuals place on environmental preservation and protection and their supporting actions.
Research on environmental consciousness and its impact on company performance is not conclusive. The traditional belief is that environmental activities negatively affect company performance, as measured by sales growth or profitability. This would reflect investments the firm makes in products and processes to achieve greater eco-friendliness (Freeman, 1994; Judge, 1994). Conversely, there are indications that being environmentally proactive may lead to long-term economic gain (Bandley, 1992; Remich, 1993). Fernberg (1993), Shi and Kane (1995), and Ahmed, Montagno and Firenze (1998) document the success some companies have achieved using environmental consciousness strategies.
Rishel and Hubble (2001) state that noncompliance with environmental standards established by ISO 14000 may impede a firm's chances of entering the global marketplace. ISO 14000 is a set of voluntary environmental standards devised by the International Standards Organization that focus on an organization's environmental management system. They are designed to manage, track, and ultimately reduce a firm's negative impact on the environment. Many global companies, such as GM, IBM, and Volvo, are now requiring their suppliers to be ISO 14000 compliant. Rishel and Hubble also state that savings can be realized by improved operations, more efficient raw material consumption, and reduced waste management costs.
An important question is, what determines a firm's environmental posture, activity, and commitment? The answer includes the employees of the firm and various other stakeholders who, for various reasons, influence management. Prominent among these stakeholders are governmental regulatory bodies,...