Proactive corporate environmental strategy and the development of competitively valuable organizational capabilities

Abstract

This article presents the results of a study conducted in two phases within a single industry context. The first phase involved comparative case studies to ground the applicability of the resource‐based view of the firm within the domain of environmental responsiveness. The second phase involved testing the relationships observed during the case studies through a mail survey. It was found that strategies of proactive responsiveness to the uncertainties inherent at the interface between the business and ecological issues were associated with the emergence of unique organizational capabilities. These capabilities, in turn, were seen to have implications for firm competitiveness. © 1998 John Wiley & Sons, Ltd.

The whole relationship between environmental variables and firm performance: Competitive advantage and firm resources as mediator variables

“…Judge and Douglas, 1998;Sharma and Vredenburg, 1998). The main reason is that managers were more open to 2 Spain is a part of the EU, and environmental regulations are same in the whole area (and similar to others in the rest of the developed world), which means that our sample has potential for generalization.…”

“…Aragó n-Correa and Sharma (2003), Christmann (2000), Sharma and Vredenburg (1998) and Wagner (2005) identify the importance of developing superior firm resources based on the firm's relationship with the natural environment as a source of competitive advantage. For instance, Miles and Covin (2000) indicate that a firm's advantage in reputation is bound to favor a more profitable exploitation of marketing opportunities and, thus, increase market value.…”

“…Proactive corporate environmental strategies that go beyond regulatory compliance have a positive effect on firm performance when mediated by valuable organizational capabilities (Galdeano-Gó mez et al, 2008;Russo and Fouts, 1997;Sharma and Vredenburg, 1998;Wagner, 2005). Moreover, Judge and Elenkov (2005) indicate that the higher the organization's capacity for change, the more likely its environmental performance is to be high.…”

“…Following these studies, we propose to analyze the causal relationships between environmental variables and financial performance, considering the role of competitive advantages as mediator variable. For example, a better environmental performance can provide competitive advantage (low cost and differentiation) which will subsequently improve financial performance (Klassen and McLaughlin, 1996;Sharma and Vredenburg, 1998).…”

“…In fact, different papers have highlighted only partial aspects of the whole relationship. For example, some studies have analyzed the relationship between environmental management and environmental performance (Barla, 2007;Szymanski and Tiwari, 2004;Zhu and Sarkis, 2004); other papers have studied the connection between environmental management and financial performance (Melnyk et al, 2003;Menguc and Ozanne, 2005;Wahba, 2008), or between environmental performance and financial performance (Al-Tuwaijri et al, 2004;Nakao et al, 2007;Wagner, 2005;Wagner et al, 2002); and some previous papers have discussed the relationship between firm resources and financial performance (Aragó n-Correa and Sharma, 2003;Aragó nCorrea et al, 2008;Sharma and Vredenburg, 1998). However, these studies have ignored some mediator variables.…”