Optimizing environmental expenditures for maximizing economic performance (original) (raw)

Management Decision, 2016

Abstract

Purpose Corporate environmental expenditure has been a growing concern in recent years, yet mixed findings exist regarding its economic impact. The purpose of this paper is to explain the mixed relationship between environmental expenditure and economic performance from the natural-resource-based view. Design/methodology/approach Using Global Reporting Initiative survey data from 120 firms in 30 countries, this study uses PROCESS, a path-based analysis software, to test the moderation and mediation hypotheses in an integrated analytical model. Findings The findings show that environmental expenditure has a negative impact on economic performance through pollution prevention capability. In contrast, environmental expenditure has a positive impact on economic performance through product stewardship capability. Both effects are significantly strengthened when the firm is located in an environmentally munificent country. Practical implications This study intends to inform firm managers,...

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