Influence of Government Support on Proactive Environmental Strategies in Family Firms

Scholars have dedicated significant efforts to understanding the factors that influence the environmental strategy of a firm, in order to mitigate the negative impacts on the ecosystem. Learning more about the factors that encourage environmental behavior allows managers and policy makers to improve action and advance correctly in this direction. Despite this academic interest, the literature regarding family business has undertaken limited attention over the issue. Hence, our paper aims to advance in this line of research, by empirically examining the relationship between government support in family firms and their investment in environmental protection. Specifically, we intend to analyze whether the family nature, and the government financial support, influence their environmental strategy. The empirical analysis is developed with a sample of 1802 manufacturing firms in Spain, using a binary logistic regression to evaluate the existence of dependency relationships between the analyzed variables. The results show this dependency, confirming family nature and government support as significant factors for a proactive environmental strategy, funding the idea that family character positively affects environmental performance in line with the socio-emotional wealth approach, and these differences are greater if the company operates mainly in a local area. Likewise, family firms that receive state direct and indirect funding, invest more in environmental issues to mitigate negative external impacts. The practical implications of the results obtained are especially useful for managers of family businesses as well as for central governments and local institutions as a matter of reflection. To reduce administrative processes and costs for family firms in terms of direct and indirect support is of great importance, as an inadequate process may become a barrier to develop environmental strategies.

Antecedents of environmental strategies: a study of the manufacturing industry in Pakistan

PurposeThe paper aims to explore how market pressures, upper echelons theory and slack resources interact to affect pro-environmental strategies in an emerging market. Specifically, the authors assess external market factors (consumer concerns, regulatory forces and competitors' concerns) in terms of how they are negotiated through internal resources and company capabilities (top management commitment and discretionary slack) to produce or not produce pro-environmental strategies (environmental corporate strategy and environmental marketing strategy).Design/methodology/approachA total of 1,000 questionnaires were distributed in the Pakistani manufacturing sector – where energy use and natural resources consumption is intensive. The final 181 useable responses were analyzed using covariance-based structural equation modeling and the PROCESS macro.FindingsThe results reveal that regulatory forces and competitors' concerns have both direct and conditional indirect effects on environmental corporate strategy but only conditional indirect effects on environmental marketing strategies through the mediation of top management commitment and at different levels of discretionary slack. However, consumer concerns remain inconsequential antecedents with insignificant direct effects and conditional indirect effects on environmental corporate and marketing strategies through the mediation of top management commitment at different levels of discretionary slack.Originality/valueThe authors propose an integrative model as a functioning mechanism for the environmental strategic decisions of companies in emerging markets. This model relies on both slack resource and upper echelons theories. These findings contribute to a better understanding of the impacts of internal and external determinants and functions on environmental strategies at corporate and functional levels in emerging markets. The various paths to diverse levels of environmental strategy and the insignificant role of consumer concerns suggest a need for further investigation of corporate environmentalism in emerging markets that consider their distinctive legal, societal, market and institutional contexts.

Strategy-Driven Implications for the Management Control Systems of Electricity Generators due to Government Climate Change Policies

<p>The New Zealand Government has developed and revised different climate change policies (GCCPs) over the last nine years in order to meet its Kyoto obligations and address the challenges of climate change. The key GCCPs are the carbon tax proposed in 2002 but cancelled in 2005; the Projects to Reduce Emissions (PRE) scheme during 2003-2004; and an emissions trading scheme (ETS) announced in 2007, legislated in 2008 and then modified in 2009. These GCCP changes are likely to impose significant costs and additional volatilities and pressures on electricity generators because their production activities are emissions-intensive. Consequently generators have been the direct targets of various GCCPs. This study addresses the following research question: “What are the management control system (MCS) implications arising from strategy choices New Zealand electricity generators make in managing economic volatility and societal pressures resulting from a prolonged period of GCCP change?”. In answering this question, the study adopts a multiple-theory research framework that builds on insights from prior literature and the theoretical perspectives of transactional cost economics, institutional theory and resource-based theory. This study uses a multiple-case study that analyses interviews and 10-years of documentary data related to five major generators within the New Zealand electricity industry over five periods from 2000 to 2009. The results suggest that GCCP changes impose external economic volatilities and societal pressures on the generators and affect their costs, market competitiveness, and social legitimacy. The diversity of internal characteristics and capabilities of the generators are found to moderate their relative degree of exposure to these external volatilities and pressures. Ten GCCP-related environmental strategies were formulated and implemented by the generators, with different levels of proactiveness (i.e. scope and timing), varying top management emphasis, as well as distinct underlying objectives. These strategy choices had significant implications for organisational MCS. In response, a wide range of controls and control systems were adopted. These can be classified into eight MCS component types and three MCS component groups, each of which supported one or more environmental strategies. Managers varied the degree of use of these MCS component types and groups to match the level of strategy proactiveness and top management emphasis pursued within each period. Additionally, the organisational MCS was underlined by three main objectives (cost control, competitiveness, and legitimacy) which in turn were driven by each generator’s primary strategy objectives and GCCP-related external exposure. This study addresses a number of gaps in the academic literature and demonstrates the merits of a multiple-theoretical framework in examining GCCP-related strategy and MCS changes. The results also have significant implications for managers and practitioners when planning organisational adaptation to a carbon-constrained economy. Further, the study provides a useful basis for regulators and policy-makers in making the appropriate assessment and providing advice to improve the GCCPs’ environmental and economic outcomes.</p>

Strategy-Driven Implications for the Management Control Systems of Electricity Generators due to Government Climate Change Policies

<p>The New Zealand Government has developed and revised different climate change policies (GCCPs) over the last nine years in order to meet its Kyoto obligations and address the challenges of climate change. The key GCCPs are the carbon tax proposed in 2002 but cancelled in 2005; the Projects to Reduce Emissions (PRE) scheme during 2003-2004; and an emissions trading scheme (ETS) announced in 2007, legislated in 2008 and then modified in 2009. These GCCP changes are likely to impose significant costs and additional volatilities and pressures on electricity generators because their production activities are emissions-intensive. Consequently generators have been the direct targets of various GCCPs. This study addresses the following research question: “What are the management control system (MCS) implications arising from strategy choices New Zealand electricity generators make in managing economic volatility and societal pressures resulting from a prolonged period of GCCP change?”. In answering this question, the study adopts a multiple-theory research framework that builds on insights from prior literature and the theoretical perspectives of transactional cost economics, institutional theory and resource-based theory. This study uses a multiple-case study that analyses interviews and 10-years of documentary data related to five major generators within the New Zealand electricity industry over five periods from 2000 to 2009. The results suggest that GCCP changes impose external economic volatilities and societal pressures on the generators and affect their costs, market competitiveness, and social legitimacy. The diversity of internal characteristics and capabilities of the generators are found to moderate their relative degree of exposure to these external volatilities and pressures. Ten GCCP-related environmental strategies were formulated and implemented by the generators, with different levels of proactiveness (i.e. scope and timing), varying top management emphasis, as well as distinct underlying objectives. These strategy choices had significant implications for organisational MCS. In response, a wide range of controls and control systems were adopted. These can be classified into eight MCS component types and three MCS component groups, each of which supported one or more environmental strategies. Managers varied the degree of use of these MCS component types and groups to match the level of strategy proactiveness and top management emphasis pursued within each period. Additionally, the organisational MCS was underlined by three main objectives (cost control, competitiveness, and legitimacy) which in turn were driven by each generator’s primary strategy objectives and GCCP-related external exposure. This study addresses a number of gaps in the academic literature and demonstrates the merits of a multiple-theoretical framework in examining GCCP-related strategy and MCS changes. The results also have significant implications for managers and practitioners when planning organisational adaptation to a carbon-constrained economy. Further, the study provides a useful basis for regulators and policy-makers in making the appropriate assessment and providing advice to improve the GCCPs’ environmental and economic outcomes.</p>

How Do Proactive Environmental Strategies Affect Green Innovation? The Moderating Role of Environmental Regulations and Firm Performance

Global warming has gained the attention of researchers and authorities to work on the environmental glitches. Prior researchers highlighted that the industrial sector is more responsible for these environmental glitches. The industrial sector is highly participated for climate change problems. In the light of firm’s sustainable development goals, this study focuses on the proactive environmental strategies for green innovation. Furthermore, this study considers the link amid environmental regulations and green innovation, firm performance, and green innovation. Most importantly, this study applies the moderating role of environmental regulations and firm performance on the link amid proactive environmental strategies and green innovation. The outcomes with ordinary least square, fixed effect, generalized method of moments, and feasible generalized least square presents unique conclusions. This study concluded that firms with proactive environmental strategies are more valuable for green innovation practices. The environmental regulations promote green innovative practices. Similarly, firm performance also encourages the firm for green innovative practices. Importantly, these outcomes suggest that environmental regulations positively moderate the link amid proactive environmental strategies and green innovation. In addition, firm performance also plays positive role for positivity amid proactive environmental strategies and green innovation. These findings are imperative addition into the narrow literature of environmental practices at firm level in Pakistan. Moreover, this study suggests various guidelines and directions for policy makers, owners, governments, and stakeholders as promoting the environmental practices for higher profitability as well as minimizing industrial negative effects.