Heterogeneous choices of environmental strategies for heavily polluting firms under institutional pressure in China

Abstract The presence of nonzero conjectural variations in pollution abatement and output make emission taxes less effective with respect to reducing emissions. This has implications for the characterization of the optimal emission tax, particularly in an international context where there are large asymmetries in pollution intensities. A higher degree of collusion in output between polluting firms results in higher emissions taxes in the non-cooperative equilibrium. In contrast, a higher degree of collusion in abatement between polluting firms results in lower emissions taxes in the non-cooperative equilibrium. These results rely on the presence of nonzero conjectural variations and large asymmetries in pollution intensities across countries. The analysis is relevant to the design of international environmental policy, including cases where countries face increasing global competition and damages from rising global emissions.

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A Multilevel Model of Environmentally Specific Social Identity in Predicting Environmental Strategies: Evidence from Technology Manufacturing Businesses

Sustainability ◽

10.3390/su13084567 ◽

2021 ◽

Vol 13 (8) ◽

pp. 4567

Author(s):

Stanley Y. B. Huang ◽

Chih-Wen Ting ◽

Yu-Ming Fei

Keyword(s):

Transformational Leadership ◽

Social Identity ◽

Social Identity Theory ◽

Multilevel Model ◽

Hierarchical Linear Model ◽

Chief Executive ◽

Individual Level ◽

Upper Echelons Theory ◽

Environmental Strategies ◽

Identity Based

This study proposed a multilevel model of environmentally specific social identity based on upper echelons theory and examined how environmentally specific transformational leadership influenced the environmentally specific social identity of the top management team (TMT), which consequently influenced a corporation’s choices of proactive environmental strategies. Besides, the environmentally specific transformational leadership atmosphere at the TMT level also influenced the environmentally specific social identity atmosphere at the TMT level, which consequently influenced a corporation’s choices of proactive environmental strategies at the same time. In particular, this study proposed a novel concept–environmentally specific social identity based on social identity theory, including environmentally specific self-categorization, environmentally specific affective commitment, environmentally specific self-esteem. This study employed a hierarchical linear model and collected longitudinal data of 210 chief executive officers with their 840 members of TMTs at technology manufacturing businesses of Greater China at three waves over six months to analyze the theoretical model. This study found that individual-level environmentally specific transformational leadership and TMT-level environmentally specific transformational leadership (atmosphere) influenced individual-level environmentally specific social identity and TMT-level environmentally specific social identity (atmosphere), which consequently influenced proactive environmental strategies. These findings provide theoretical insights for the field of sustainable development that can advance the literature on proactive environmental strategies.

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The Market Valuation of Environmental Capital Expenditures by Pulp and Paper Companies

The Accounting Review ◽

10.2308/accr.2004.79.2.329 ◽

2004 ◽

Vol 79 (2) ◽

pp. 329-353 ◽

Cited By ~ 233

Author(s):

Peter M. Clarkson ◽

Yue Li ◽

Gordon D. Richardson

Keyword(s):

Environmental Performance ◽

Capital Expenditure ◽

Paper Industry ◽

Pulp And Paper Industry ◽

Economic Benefits ◽

Pulp And Paper ◽

Market Valuation ◽

The Future ◽

Environmental Capital ◽

Polluting Firms

The objective of this study is to examine the market valuation of environmental capital expenditure investment related to pollution abatement in the pulp and paper industry. The total environmental capital expenditure of $8.7 billion by our sample firms during 1989–2000 supports the focus on this industry. In order to be capitalized, an asset should be associated with future economic benefits. The existing environmental literature suggests that investors condition their evaluation of the future economic benefits arising from environmental capital expenditure on an assessment of the firms' environmental performance. This literature predicts the emergence of two environmental stereotypes: low-polluting firms that overcomply with existing environmental regulations, and high-polluting firms that just meet minimal environmental requirements. Our valuation evidence indicates that there are incremental economic benefits associated with environmental capital expenditure investment by low-polluting firms but not high-polluting firms. We also find that investors use environmental performance information to assess unbooked environmental liabilities, which we interpret to represent the future abatement spending obligations of high-polluting firms in the pulp and paper industry. We estimate average unbooked liabilities of $560 million for high-polluting firms, or 16.6 percent of market capitalization.

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