Journal of Business Ethics

, Volume 112, Issue 2, pp 353-366

First online:

Beyond “Does it Pay to be Green?” A Meta-Analysis of Moderators of the CEP–CFP Relationship

  • Heather R. Dixon-FowlerAffiliated withDepartment of Management, Walker College of Business, Appalachian State University Email author 
  • , Daniel J. SlaterAffiliated withMcAfee School of Business, Union University
  • , Jonathan L. JohnsonAffiliated withDepartment of Management, Sam M. Walton College of Business, University of Arkansas
  • , Alan E. EllstrandAffiliated withDepartment of Management, Sam M. Walton College of Business, University of Arkansas
  • , Andrea M. RomiAffiliated withAccounting Department, Kelley School of Business, Indiana University

Rent the article at a discount

Rent now

* Final gross prices may vary according to local VAT.

Get Access


Review of extant research on the corporate environmental performance (CEP) and corporate financial performance (CFP) link generally demonstrates a positive relationship. However, some arguments and empirical results have demonstrated otherwise. As a result, researchers have called for a contingency approach to this research stream, which moves beyond the basic question “does it pay to be green?” and instead asks “when does it pay to be green?” In answering this call, we provide a meta-analytic review of CEP–CFP literature in which we identify potential moderators to the CEP–CFP relationship including environmental performance type (e.g., reactive vs. proactive performance), firm characteristics (e.g., large vs. small firms), and methodological issues (e.g., self-report measures). By analyzing these contingencies, this study attempts to provide a basis on which to draw conclusions regarding some inconsistencies and debates in the CEP–CFP research. Some of the results of the moderator analysis suggest that small firms benefit from environmental performance as much or more than large firms, US firms seem to benefit more than international counterparts, and environmental performance seems to have the strongest influence on market-measures of financial performance.


Corporate environmental performance Corporate financial performance Environmental sustainability Meta-analysis