Environmental and Resource Economics

, Volume 44, Issue 2, pp 245–262

ISO 14001 Environmental Certification: A Sign Valued by the Market?

  • Joaquín Cañón-de-Francia
  • Concepción Garcés-Ayerbe

DOI: 10.1007/s10640-009-9282-8

Cite this article as:
Cañón-de-Francia, J. & Garcés-Ayerbe, C. Environ Resource Econ (2009) 44: 245. doi:10.1007/s10640-009-9282-8


The main purpose of this work is to analyse whether ISO 14001 certification is interpreted by the capital market as a sign of environmental responsibility, modifying long-term efficiency expectations and the profitability of firms. Under competing assumptions that ISO 14001 certification is adopted by firms either proactively or reactively, we test competing hypotheses about how this certification affects the market value of firms. The analysis is based on a sample of 80 environmental certifications of the plant systems or processes of large Spanish firms which traded on the continuous market of the Madrid Stock Exchange from 1996 to 2002. Using event study methodology, we found that ISO 14001 certification has a negative effect on the market value of certain firms. Specifically, the results obtained seem to show that the market negatively views the allocation of resources to ISO 14001 certification in the case of less polluting and less internationalised firms. On the other hand, the results obtained do not suggest clear evidence that the economic impact of ISO 14001 certification is negative for more polluting and more internationalised firms.


Environmental Management SystemEnvironmental proactivenessISO 14001 certificationMarket valueResource-based viewEvent study methodology

Copyright information

© Springer Science+Business Media B.V. 2009

Authors and Affiliations

  • Joaquín Cañón-de-Francia
    • 1
  • Concepción Garcés-Ayerbe
    • 1
  1. 1.Departamento de Economía y Dirección de EmpresasUniversity of Zaragoza (Spain)ZaragozaSpain