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http://hdl.handle.net/10397/89878
Title: | Maintaining stability while boosting growth? The long-term impact of environmental accreditations on firms' financial risk and sales growth | Authors: | Ye, Y Yeung, ACL Huo, B |
Issue Date: | 9-Dec-2020 | Source: | International journal of operations and production management, 9 Dec. 2020, v. 40, no. 12, p. 1829-1856 | Abstract: | Purpose: In this research, we examine the impact of ISO 14001, an international environmental management accreditation, on the long-term financial risk and sales growth of firms. Design/methodology/approach: We employ a quasi-experimental design and construct 682 treated and control firms that are matched using propensity score matching. We then test our hypotheses using the difference in difference model. Findings: We find that, although ISO 14001 leads to lower financial risk, standard management systems such as ISO 14001 actually hinder the sales growth of firms, an unanticipated outcome. In particular, this trade-off worsens over time, becoming particularly more severe among firms that adopt ISO 14001 early and operate in less-polluting industries. Research limitations/implications: We present a hidden side of environmental accreditations, indicating a potential trade-off in the long-term efficacy of environmental standard management systems. Practical implications: Firms must be cautious about adopting environmental management systems. Over time, a focus on environmental certification could potentially hinder firms' long-term growth. Firms should also be aware of certification timing and levels of industry pollution to resolve the tension in the trade-off. Originality/value: This research is one of the first studies demonstrating that environmental accreditations result in a trade-off between reducing financial risk and improving sales growth. |
Keywords: | Environmental accreditations Financial risk ISO 14001 Sales growth Trade-off |
Publisher: | Emerald Group Publishing Limited | Journal: | International journal of operations and production management | ISSN: | 0144-3577 | EISSN: | 1758-6593 | DOI: | 10.1108/IJOPM-05-2019-0407 | Rights: | © Emerald Publishing Limited. This AAM is provided for your own personal use only. It may not be used for resale, reprinting, systematic distribution, emailing, or for any other commercial purpose without the permission of the publisher. The following publication Ye, Y., Yeung, A.C.L. and Huo, B. (2020), "Maintaining stability while boosting growth? The long-term impact of environmental accreditations on firms' financial risk and sales growth", International Journal of Operations & Production Management, Vol. 40 No. 12, pp. 1829-1856 is available at https://doi.org/10.1108/IJOPM-05-2019-0407. |
Appears in Collections: | Journal/Magazine Article |
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File | Description | Size | Format | |
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1304_IJOPM_Environmental.pdf | Pre-Published version | 1.1 MB | Adobe PDF | View/Open |
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