Managing for the environment doesn’t necessarily mean additional expense – see this week’s research articles.

Environmental reporting in three regimes 
Normativity is assessed as these authors evaluate and compare the environmental reporting practices of a sample of French and Canadian companies through the lens of institutional legitimacy. More specifically, the authors examine how French and Canadian firms changed their reporting practices in reaction to the promulgation of laws and regulations in their respective countries, i.e., the NER and Grenelle II Acts in France, and National Instrument 51-102 and CSA Staff Notice NR 51-333, issued by the Canadian Securities Administrators.

The firms’ voluntary disclosures according to GRI guidelines are also investigated. Substantive legitimacy theory is used to explore the level of substantive disclosures provided by Canadian and French firms.

The findings reveal that the French parliamentary regime is more successful than the Canadian stock exchange regulation in triggering environmental reporting, and that the GRI combined with local regimes prompts environmental disclosures. Notwithstanding the improvements in environmental reporting under all three regimes, a very low level of substantive disclosure is noted in both countries.

Mohamed Chelli, Sylvain Durocher and Anne Fortin. 2018. Normativity in Environmental Reporting: A Comparison of Three Regimes.
Journal of Business Ethics, 149(2), 285–311.


Corporate Environmental Responsibility and the cost of capital 
The authors examine how corporate environmental responsibility (CER) affects the cost of equity capital for manufacturing firms in 30 countries. Using several approaches to estimate firms’ ex ante equity financing costs, the authors find in regressions that control for firm-level characteristics as well as industry, year, and country effects that the cost of equity capital is lower when firms have higher CER.

This finding is robust to addressing endogeneity through instrumental variables, to using alternative specifications and proxies for the cost of equity capital, and to accounting for noise in analyst forecasts. The authors conclude that investment in CER reduces firms’ equity financing costs worldwide.

Sadok El Ghoul, Omrane Guedhami, Hakkon Kim and Kwangwoo Park. 2018. Corporate Environmental Responsibility and the Cost of Capital: International Evidence.
Journal of Business Ethics, 149(2), 335–361.


Relationship between environmental and firm performance 
The nature of the relationship between environmental performance (EP) and firm performance (FP) of corporations is a long standing and contentious issue in the literature. This study is intended to advance this debate by arguing for the existence of curvilinear relationship and empirically testing the same using survey data on UK manufacturing firms.

FP is captured in terms of growth in sales and market share. The results show evidence for a quadratic relationship—as firms improve their EP, they seem to achieve much higher levels of FP. These results are consistent with the resource-based view of a firm; as firms engage in EP activities, they are able to gain inimitable knowledge that helps in further learning to further improve performance.

Based on these results, the authors suggest that new studies focus on strategies to extend the period of increasing returns and maximizing the benefits of the positive association between EP and FP.

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Ramakrishnan Ramanathan. 2018. Understanding Complexity: the Curvilinear Relationship Between Environmental Performance and Firm Performance.
Journal of Business Ethics, 149(2), 383–393.


Drivers of managers’ citizenship behaviours for the environment 
The objective of this longitudinal study is to analyse the intrinsic drivers and values underlying managers’ organisational citizenship behaviours for the environment (OCBEs) from a developmental psychology perspective based on measuring the stages of consciousness that shape the meaning-making systems of individuals.

At time 1, the stages of consciousness of 138 managers were qualitatively assessed using the Leader Development Profile test. At time 2, a quantitative survey measured the environmental beliefs and OCBEs of these managers. The links between stages of consciousness, environmental beliefs, and OCBEs were analysed using hierarchical regressions.

The main findings show that managers’ stages of consciousness positively influence two types of OCBEs, namely eco-initiatives and eco-helping, while environmental beliefs influence eco-helping and eco-civic engagement but do not appear to be connected with the stage of consciousness development.

This paper first contributes to the literature on corporate greening by shedding more light on the aspects of behavioural and developmental psychology that underlie environmental leadership. Second, it bridges the gap between theories that have developed separately by showing the interconnectedness between the managers’ stage of consciousness and the more concrete environmental behaviours in the workplace that could have emulative effects throughout the organisation.

Olivier Boiral, Nicolas Raineri and David Talbot. 2018. Managers’ Citizenship Behaviors for the Environment: A Developmental Perspective.
Journal of Business Ethics, 149(2), 395–409.


Environmental management, climate change, CSR and governance 
One of the key debates in the literature on small and medium enterprises and corporate social responsibility in developing countries has to do with the role that local industrial districts, or so-called industrial clusters, play in the promotion of CSR in those countries. While there is now an embryonic literature on this subject, the authors lack systematic, integrated analytical frameworks that can improve our understanding of the role that governance of clusters play in addressing CSR concerns in SMEs in developing countries.

This article develops such a conceptual framework drawing on the literatures on cluster governance, CSR, SMEs, and environmental management as they relate to the developing countries. The authors argue that environmental improvements in SME clusters can be achieved through three basic types of cluster governance: legal enforcement, supply chain pressure, and voluntary engagement in CSR.

The proposed framework is an attempt to show how each type of cluster governance is likely to induce different responses in cluster-based SMEs. These responses are related to stages of CSR in which SMEs engage, the barriers to EM they face, the types of EM practices they use, the climate change strategy types they use, and the kinds of benefits that accrue to SMEs from engagement in CSR. The authors put forward a framework that can be useful for both academics and practitioners as they seek to reflect on the interconnectedness of these themes from a research, policy, and practice perspective.

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Charbel Jose Chiappetta Jabbour & Jose A. Puppim de Oliveira. 2017. Environmental Management, Climate Change, CSR, and Governance in Clusters of Small Firms in Developing Countries: Toward an Integrated Analytical Framework.
Business and Society 56(1), 130-151.


Experiments in climate governance – A systematic review of research on energy and built environment transitions 
Experimentation has been proposed as a key way in which governance drives sustainability transitions, notably by creating space for innovative solutions to emerge. In seeking to bring greater coherence to the literatures on climate and sustainability governance experiments, this article reports on a systematic review of articles published between 2009 and 2015.

Based on these results a new definition and typology of climate governance experiments is suggested. The typology distinguishes between the various purposes experiments can have, including niche creation, market creation, spatial development, and societal problem solving. It deepens the understanding of the diversity in experimenting by highlighting the salient features of different types of governance experiments. It can therefore guide future research to generate more cumulative research findings contributing to a better understanding of the role and outcomes of experiments in societal transitions. The findings also suggest that real transitions towards low-carbon and climate-resilient societies will require a systematic deliberate combination of different types of experiments.

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Paula Kivimaa, Mikael Hildén, Dave Huitema, Andrew Jordan and Jens Newig. 2017. Experiments in climate governance – A systematic review of research on energy and built environment transitions.
Journal of Cleaner Production, 169(Dec), 17-29.