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Impact of Adoption of Environmental Standards on Firm Value in the Chinese Market

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Non-market Strategies in International Business

Part of the book series: The Academy of International Business ((AIB))

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Abstract

This chapter suggests that previous studies have failed to establish a conclusive relationship on the value to firms in adopting environmental management standards. Recognizing this gap, this empirical chapter examines whether and how firms can enhance their market performance using effective environmental management standards (notably the ISO 14001) in the context of China, which is widely recognized for its manufacturing and exporting sector in international business studies. Using an event study methodology in conjunction with a practice-based view, this study seeks comparison between ISO 14001 certified and non-certified firms on their market-based performance. Contrary to some prior studies, the findings of this study suggest that the adoption of ISO 14001 by firms is negatively valued by investors and has a negative effect on performance. Based on this finding, the study further provides important policy implications for management, regulators, and NGOs .

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Acknowledgements

We are grateful to Prof. Dr. Tazeeb S. Rajwani (University of Surrey, UK) and Dr. Tahiru Azaaviele Liedong (University of Bath, UK) for their insightful comments and valuable suggestions.

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Authors and Affiliations

  1. Department of Management Sciences, COMSATS University, Islamabad, Pakistan

    Hammad Riaz & Abubakr Saeed

  2. Department of Law and Finance, University of Bedfordshire Business School, Luton, UK

    Muhammad Sameer

Authors
  1. Hammad Riaz
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  2. Abubakr Saeed
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  3. Muhammad Sameer
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Editor information

Editors and Affiliations

  1. Department of Strategy and Marketing, University of Sussex Business School, Brighton, UK

    Vikrant Shirodkar

  2. Department of Strategy and Marketing, University of Sussex Business School, Brighton, UK

    Roger Strange

  3. Department of Strategy and Marketing, University of Sussex Business School, Brighton, UK

    Steven McGuire

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Riaz, H., Saeed, A., Sameer, M. (2020). Impact of Adoption of Environmental Standards on Firm Value in the Chinese Market. In: Shirodkar, V., Strange, R., McGuire, S. (eds) Non-market Strategies in International Business . The Academy of International Business. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-35074-1_9

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