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Determinants of Environmental Standards Adoption by Multinational Corporations: A Review of Extant Literature

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Non-market Strategies in International Business

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

Abstract

This chapter suggests that MNEs’ voluntary environmental management efforts are increasingly recognized and research on MNEs’ environmental management strategies has grown over the years. Significant research has gone into the factors that affect the adoption of environmental management ‘standards’ (such as the ISO 14001, EMAS, and Responsible Care) by MNEs’ subsidiaries in a host country context. This chapter provides a review of extant literature on the determinants of MNEs’ environmental management standards adoption and sheds light on how MNEs’ subsidiaries can adopt such standards. A detailed analysis of theoretical explanations and empirical findings of existing literature is presented and summarized, identifying the institutional, market-based, non-market, and firm-level factors determining this behaviour. The chapter concludes with an argument that an MNE’s home-country institutional environment matters in the adoption of environmental management standard by its subsidiaries.

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Notes

  1. 1.

    Such as the British Standards Institute, the International Standards Organization, the European Union, the American Forest and Paper Association, and the U.S. Department of Energy.

  2. 2.

    (a) the level of education of the workforce, which facilitates absorption of knowledge regarding ISO 14001; (b) the firm’s innovative capabilities for product and process innovation; and (c) employee participation in the environmental management process.

  3. 3.

    Ownership is defined as a summative condition that includes: (1) the interests and constraints of respective owners (such as societies, government, and individuals) and managers, as well as the conflicts among owners and managers and (2) the abilities of these parties to obtain resources such as financial capital, management expertise, and technical talents (Mascarenhas, 1989).

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  1. Department of Business and Law, University of Portsmouth, Portsmouth, UK

    Monalisa Haque

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  1. Monalisa Haque
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Correspondence to Monalisa Haque .

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  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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Haque, M. (2020). Determinants of Environmental Standards Adoption by Multinational Corporations: A Review of Extant Literature. 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_8

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