Exploring the moderating effect of financial performance on the relationship between corporate environmental responsibility and institutional investors: some Egyptian evidence

2008 ◽  
Vol 15 (6) ◽  
pp. 361-371 ◽  
Author(s):  
Hayam Wahba
Keyword(s):  
Financial Performance ◽  
Institutional Investors ◽  
Moderating Effect ◽  
Environmental Responsibility ◽  
Corporate Environmental Responsibility ◽  
The Relationship

scholarly journals Does corporate environmental responsibility affect investor future goal in the energy sector firms?

2021 ◽  
Vol 905 (1) ◽  
pp. 012140
Author(s):  
A Setyowati ◽  
N H Purnomowati ◽  
D N Sari ◽  
E S Ramadhan
Keyword(s):  
Financial Performance ◽  
Stakeholder Theory ◽  
Energy Sector ◽  
Environmental Responsibility ◽  
Corporate Environmental Responsibility ◽  
Environmental Initiatives ◽  
The Relationship ◽  
Sample Set

Abstract This study investigates the relationship between corporate environmental responsibility and firm’s financial performance by using a sample set of 2,241 firm-year observations representing 470 unique energy firms from 30 countries from 2013–2020. Supporting stakeholder theory, we find that firms with better environmental responsibility actions are associated with higher Tobins’q, suggesting that the investors react positively to the firm’s environmental initiatives. Overall, our findings suggest that firms in the energy sector should pay attention to corporate environmental responsibility practices to obtain a good response from the investors and achieve the firm’s long-term financial goals.

scholarly journals Impact of Corporate Environmental Responsibility on Firm’s Financial Performance: Moderating Role of Organizational Slack and Industry Competition

2022 ◽  
Vol 8 (2) ◽  
pp. 76-92
Author(s):  
Muhammad Amir ◽  
Naveed Iqbal ◽  
Sheeza Tahir
Keyword(s):  
Financial Performance ◽  
Moderating Effect ◽  
Annual Reports ◽  
Environmental Responsibility ◽  
Corporate Financial Performance ◽  
Organizational Slack ◽  
Corporate Environmental Responsibility ◽  
Industry Competition ◽  
Data Validity

Due to speedy trade and industry expansion in the emerging economies it is creating stern environmental corrosion. Effluence makers’ enterprises are mostly responsible for environmental deterioration. Therefore, it is the responsibility of those firms to take steps to control this corrosion in the environment. This research explains the effect of corporate environmental responsibility (CER) on corporate financial performance (CFP) with the moderating effect of organizational slack and industry competition. Data was collected from annual reports of 50 KSE 100 index companies from 2012-2019, containing total 450 observations. Dynamic penal model was used to test the study hypothesis by using Eviews, different pre and post estimations are applied to confirm the data validity.  Empirical results indicate that corporate environmental responsibility has significant positive effect on corporate financial performance, while the moderating effect of organizational slack is negative. Industry competition has significant positive moderating effect on the relationship, i.e., if there is high competition in industry then firms will invest more in environment to attract more consumers and to create good will in market. The study reveal that those firms will lead where competition is high and who will focus on their responsibility towards environment.

Corporate environmental responsibility and financial performance: does bidirectional causality work? Empirical evidence from the manufacturing industry

2017 ◽  
Vol 13 (2) ◽  
pp. 221-234 ◽  
Author(s):  
Mario Testa ◽  
Antonio D’Amato
Keyword(s):  
Financial Performance ◽  
Manufacturing Industry ◽  
Environmental Responsibility ◽  
Economic Evaluations ◽  
Corporate Environmental Responsibility ◽  
Content Type ◽  
Environmental Commitment ◽  
Panel Data Regression ◽  
External Pressures ◽  
Italian Manufacturing Firms

Purpose Over the past two decades, scholarly attention has focused mainly on a direct and inverse relationship between corporate environmental responsibility (CER) and corporate financial performance (CFP). This study aims to explore the bidirectional causality hypothesis, as good environmental results can lead to good financial results, which makes it possible to invest more resources in projects that improve environmental performance. Design/methodology/approach The authors test the bidirectional causality between CER and CFP on a sample of listed Italian manufacturing firms over the 2005-2014 period. The authors use a fixed effect panel data regression and check the robustness of the results with alternative econometric techniques. Findings Although the findings do not support bidirectional hypothesis, they establish direction/causality from CFP to CER. As a result, environmental responsibility is a consequence of prior financial performance, which supports the slack resources hypothesis. Research limitations/implications Given that companies’ environmental commitment is dictated by economic evaluations or by assessing the availability of resources to invest, it seems that the spread of environmentally responsible behaviours might be supported by different external pressures. Originality/value The paper provides further insights on sustainability management literature by establishing a bidirectional relationship between firm performance and environmental responsibility.

The impact of corporate environmental responsibility strategy on brand sustainability

2018 ◽  
Vol 9 (3) ◽  
pp. 366-394 ◽  
Author(s):  
Chengzhi Long ◽  
Jing Lin
Keyword(s):  
Competitive Advantage ◽  
Empirical Evidence ◽  
Two Dimensions ◽  
Environmental Responsibility ◽  
Brand Value ◽  
Corporate Environmental Responsibility ◽  
Content Type ◽  
Chinese Context ◽  
The Impact ◽  
The Relationship

PurposeThough enormous research studies were conducted on corporate environmental responsibility (CER), few of them could empirically justify how CER helps to improve firm’s competitive advantage and firms are still hesitant to incorporate CER with their business strategy at present. The purpose of this paper is to theoretically and empirically explore how the CER strategy could help the firm to gain competitive advantage in Chinese context, particularly in terms of achieving brand sustainability (BS).Design/methodology/approachIn this study, 310 listed companies in China were chosen as research sample. First, the CER strategies were classified into developing eco-friendly products, adopting EMAS or other eco-management, enhancing the impact of CER through value chain and charitable CER. Second, BS is constructed as two dimensions, i.e. resource-acquisition and consumer impact. Accordingly, this paper analyzed the relationship between CER and BS with regression model analysis, taking account of several moderating and control variables.FindingsThe results indicate that CER strategies have positive effect on BS. Among all CER strategies, developing eco-friendly products and charitable CER undertakings are the most effective ones to promote BS performance. Also, the paper found that the length of time in adopting CER strategy moderates the effect of CER on BS. The empirical evidence proves that CER strategies could enhance the brand value in terms of BS and help the company to gain competitive advantage.Research limitations/implicationsFirst, most of our samples are of the state-owned enterprises, so our assumption might not be applicable to other types of business. Second, corporate social responsibility (CSR) communication is an important factor in the relation between CSR and corporate performance, but it is not taken into account in this study. Third, the difference in industries and ownership in this research is out of concern.Practical implicationsAs this paper has provided empirical evidence to reveal the effectiveness of different CER strategies, firms in China could be more motivated to undertake CER not only for the sake of environment but also for their brand value and competitive advantage. More importantly, this paper could be a valuable reference for the firms in China to choose suitable and effective CER strategies, as proved in this study, to gain competitive advantage in the market.Originality/valueAt first, while public environmental awareness has improved gradually, we introduce the BS concept to explain how the CER strategies affect CCA. This approach gives us another perspective to highlight the relationship between these two constructs. Second, we conducted our research from practical perspective to explore how to apply the CER undertakings as the company’s strategy. Third, we conducted our empirical research in Chinese context, which will enrich the theoretical CER and CSR literature.

scholarly journals The Relationship between Corporate Environmental Responsibility and Firm Performance: A Moderated Mediation Model of Strategic Similarity and Organization Slack

2019 ◽  
Vol 11 (12) ◽  
pp. 3395 ◽  
Author(s):  
Van Thac Dang ◽  
Ninh Nguyen ◽  
Xiangzhi Bu ◽  
Jianming Wang
Keyword(s):  
Firm Performance ◽  
Past Research ◽  
Moderated Mediation ◽  
Environmental Responsibility ◽  
Organizational Slack ◽  
Mediation Model ◽  
Business Managers ◽  
Corporate Environmental Responsibility ◽  
Moderated Mediation Model ◽  
The Relationship

There has been growing interest among business managers and academics in corporate environmental responsibility (CER), which represents a company’s focus on its long-term sustainability and society. Past research, however, has reported inconsistent and mixed results with regard to the link between CER and firm performance. This study, therefore, proposes and validates a moderated mediation model of strategic similarity and organizational slack to better explain the relationship between CER and firm performance. Data were obtained from 260 listed firms in China from 2015 to 2017, resulting in 780 firm-year observations. Multivariate data analysis indicates that strategic similarity mediates the relationship between CER and firm performance. Furthermore, organizational slack moderates the relationship between CER and strategic similarity and the indirect effect of CER on firm performance through strategic similarity. The findings of this study provide insights for business managers attempting to understand and enhance the quality of their decision making regarding CER. Importantly, business managers should engage in CER activity and pursue strategic similarity to deal with pressure from stakeholders while following the competitive speed of competitors in the marketplace.

The moderating effects of a board of directors on FDI’s international diversification in Turkey

2015 ◽  
Vol 23 (1) ◽  
pp. 61-88 ◽  
Author(s):  
Kader Şahin ◽  
Seyfettin Artan ◽  
Seda Tuysuz
Keyword(s):  
Financial Performance ◽  
Board Of Directors ◽  
International Diversification ◽  
Moderating Effect ◽  
Moderating Effects ◽  
Outside Directors ◽  
Moderator Variable ◽  
Content Type ◽  
Board Characteristics ◽  
The Relationship

Purpose – This paper aims to investigate the moderating effects of a board of directors on foreign direct investment (FDI)’s international diversification in Turkey. Design/methodology/approach – A sample of Turkish multinational firms with FDI was used. Two different aspects of international diversification were considered: the relationship between international diversification and financial performance and the moderating effect of board composition on the relationship between international diversification and the firm’s financial performance. Firm-level data were obtained from the Istanbul Stock Exchange in Turkey. Findings – The findings reveal that international diversification leads to better financial performance according to market-based measures. On the other hand, this study indicates that the board characteristics have a moderating effect on international diversification and financial performance. Research limitations/implications – The study is based on a sample of publicly listed firms in Turkey, and this restriction limits the generalizability of the findings. Practical implications – The internalization efforts of Turkish FDI have led to better financial performance in terms of market-based measures. The results have stated that the interest of independent outside directors is aligned with lower-risk investment decisions. Independence of independent outside directors in Turkey is interrogated by practitioners or the Capital Markets Board of Turkey. The larger board size which a moderator variable is provided, the wider shareholder value in Turkey is. Social implications – One can understand that the development of market-supporting institutions provides the support for entry to an emerging economy which is inefficient or incomplete markets and highly concentrated family ownership. Originality/value – These findings provide important implications for corporate governance and highlight the need for further research on the role of governance in firm internationalization. This study not only helps to understand how board characteristics affect the choice of international diversification decisions, but the results also allow to assess the performance implications of these choices for a particular period.

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