Skip to main content

Environmental Performance: The Impact of R&D Intensity on Firms’ Environmental Concerns

  • Chapter
  • First Online:

Part of the book series: CSR, Sustainability, Ethics & Governance ((CSEG))

Abstract

This study investigates the relationship between R&D intensity and firms’ environmental concerns conceptualized as negative environmental externalities resulting from manufacturing activities. The study uses a large sample of U.S. firms in manufacturing industries over the period of 1991–2009. Our finding, robust to a number of sensitivity analyses, is that environmental concerns tend to decrease with R&D intensity expenditures at the firm level. This finding supports previous research and fills a gap in that research linking R&D intensity to corporate environmental performance. The result strengthens the discussion about environmental performance—namely, the reduction of negative environmental externalities—and economic performance.

This is a preview of subscription content, log in via an institution.

Buying options

Chapter
USD   29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD   39.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD   54.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD   54.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Learn about institutional subscriptions

References

  • Ahuja, G., Lampert, C. M., & Tandon, V. (2008). Moving beyond Schumpeter: Management research on the determinants of technological innovation. Academy of Management Annals, 2, 1–98.

    Article  Google Scholar 

  • Albinger, H., & Freeman, S. (2000). Corporate social performance and attractiveness as an employer to different job seeking populations. Journal of Business Ethics, 28(3), 243–253.

    Article  Google Scholar 

  • Bear, S., Rahman, N., & Post, C. (2010). The impact of board diversity and gender composition on corporate social responsibility and firm reputation. Journal of Business Ethics, 97(2), 207–221.

    Article  Google Scholar 

  • Berry, T., & Junkus, J. (2013). Social responsible investing: An investor perspective. Journal of Business Ethics, 112(4), 707–720.

    Article  Google Scholar 

  • Berrone, P., Fosfuri, A., Gelabert, L., & Gomez-Mejía, L. (2013). Necessity as mother of ‘green’ inventions: Institutional pressures and environmental innovations. Strategic Management Journal. doi:10.1002/smj.2041.

    Google Scholar 

  • Berrone, P., & Gomez-Mejía, L. (2009). Environmental performance and executive compensation: An integrated agency-institutional perspective. Academy of Management Journal, 52(1), 103–126.

    Article  Google Scholar 

  • Boons, F., Montalvo, C., Quist, J., & Wagner, M. (2012). Sustainable innovation, business models and economic performance: An overview. Journal of Cleaner Production. doi:10.1016/j.jclepro.2012.08.013.

    Google Scholar 

  • Brunnermeier, S. B., & Cohen, M. A. (2003). Determinants of environmental innovation in U.S. manufacturing industries. Journal of Environmental Economics and Management, 45, 278–293.

    Article  Google Scholar 

  • Cameron, C., & Trevidi, P. (2010). Microeconometrics using stata (Rev. ed.). College Station, TX: Stata Press.

    Google Scholar 

  • Carrión-Flores, C., & Innes, R. (2011). Environmental innovation and environmental performance. Journal of Environmental Economics and Management, 59(1), 27–42.

    Article  Google Scholar 

  • Chen, J., Patten, D., & Roberts, R. (2008). Corporate charitable contributions: A corporate social performance or legitimacy strategy? Journal of Business Ethics, 82(1), 131–144.

    Article  Google Scholar 

  • Claver, E., Lopez, M. D., Molina, J. F., & Tari, J. J. (2007). Environmental management and firm performance: A case study. Journal of Environmental Management, 84(4), 606–619.

    Article  Google Scholar 

  • de Villiers, C., Naiker, V., & van Staden, C. (2011). The effect of board characteristics on firm environmental performance. Journal of Management, 37(6), 1636–1663.

    Article  Google Scholar 

  • Dierickx, I., & Cool, K. (1989). Asset stock accumulation and sustainability of competitive advantage. Management Science, 35(12), 1504–1511.

    Article  Google Scholar 

  • García-Manjón, J., & Romero-Merino, M. E. (2012). Research, development, and firm growth. Empirical evidence from European top R&D spending firms. Research Policy, 41(6), 1084–1092.

    Article  Google Scholar 

  • Grabowski, H., & Vernon, J. (1990). A new look at the returns and risks to pharmaceuticals R&D. Management Science, 36(7), 804–821.

    Article  Google Scholar 

  • Graves, S. B., & Waddock, S. A. (1994). Institutional owners and corporate social performance. Academy of Management Journal, 37(4), 1035–1046.

    Article  Google Scholar 

  • Grinyer, P. H., Yasai-Ardekani, M., & Al-Bazzaz, S. (1980). Strategy, structure, the environment, and financial performance in 48 United Kingdom companies. Academy of Management Journal, 3(2), 193–220.

    Article  Google Scholar 

  • Hadlock, P., Hecker, D., & Gannon, J. (1991). High technology employment: Another view. Monthly Labor Review, 114, 26–30.

    Google Scholar 

  • Hammer, M., & Champy, J. (1993). Reengineering the corporation. New York: Harper Collins.

    Google Scholar 

  • Hart, S. L. (1995). A natural-resource-based view of the firm. Academy of Management Review, 20(4), 986–1014.

    Google Scholar 

  • Heyes, A., & Kapur, S. (2011). Regulatory attitudes and environmental innovation in a model combining internal and external R&D. Journal of Environmental Economics and Management, 61(3), 327–340.

    Article  Google Scholar 

  • Hillman, A. J., & Keim, D. G. (2001). Shareholder value stakeholder management, and social issues: What’s the bottom line? Strategic Management Journal, 22, 125–139.

    Article  Google Scholar 

  • Hirschey, M., Skiba, H., & Wintoki, B. (2012). The size, concentration and evolution of corporate R&D spending in U.S. firms from 1976 to 2010: Evidence and implications. Journal of Corporate Finance, 18(3), 496–518.

    Article  Google Scholar 

  • Hull, C. E., & Rothenberg, S. (2008). Firm performance: The interactions of corporate social performance with innovation and industry differentiation. Strategic Management Journal, 29(7), 781–789.

    Article  Google Scholar 

  • Jaffe, A., & Palmer, K. (1997). Environmental regulation and innovation: A panel data study. The Review of Economics and Statistics, 79(4), 610–619.

    Article  Google Scholar 

  • Johnstone, N., & Labonne, J. (2009). Why do manufacturing facilities introduce environmental management systems? Improving and/or signaling performance? Ecological Economics, 68(3), 719–730.

    Article  Google Scholar 

  • Kabongo, J. D., Chang, K., & Li, Y. (2012). The impact of operational diversity on corporate philanthropy: An empirical study of U.S. companies. Journal of Business Ethics. doi:10.1007/s10551-012-1445-9.

    Google Scholar 

  • Kacperczyk, A. (2008). With greater power comes greater responsibility? Takeover protection and corporate attention to stakeholders. Strategic Management Journal, 30(3), 261–285.

    Article  Google Scholar 

  • Koellner, T., Sangwon, S., Weber, O., Moser, C., & Scholz, R. (2007). Environmental impacts of conventional and sustainable investment funds using input-out life-cycle assessment. Journal of Business Ethics, 11(3), 41–60.

    Google Scholar 

  • Kortum, S., & Lerner, J. (2000). Assessing the contribution of venture capital to innovation. The RAND Journal of Economics, 31(4), 674–692.

    Article  Google Scholar 

  • Leonard, W. (1971). Research and development in industrial growth. Journal of Political Economy, 79(2), 232–256.

    Article  Google Scholar 

  • Liou, A., & Sharma, Z. (2012). Environmental corporate social responsibility and financial performance: Disentangling direct and indirect effects. Ecological Economics, 78, 100–111.

    Article  Google Scholar 

  • López-Gamero, M., Molina-Azorín, J., & Claver-Cortés, E. (2009). The whole relationship between environmental variables and firm performance: Competitive advantage and firm resources as mediator variables. Journal of Environmental Management, 90(10), 3110–3121.

    Article  Google Scholar 

  • McWilliams, A., & Siegel, D. S. (2000). Corporate social responsibility and firm financial performance. Strategic Management Journal, 21(5), 602–609.

    Article  Google Scholar 

  • Orlitzky, M., Schmidt, F. L., & Rynes, S. L. (2003). Corporate social and financial performance: A meta-analysis. Organization Studies, 23(4), 403–441.

    Article  Google Scholar 

  • Padgett, R., & Galan, J. (2011). The effect of R&D intensity on corporate social responsibility. Journal of Business Ethics, 93(3), 407–418.

    Article  Google Scholar 

  • Porter, M. E., & van der Linde, C. (1995). Toward a new conception of the environment-competitiveness relationship. Journal of Economic Perspectives, 9(4), 97–118.

    Article  Google Scholar 

  • Post, C., Rahman, N., & Rubow, E. (2011). Green governance: Boards of directors’ composition and environmental corporate social responsibility. Business and Society, 50(1), 189–223.

    Article  Google Scholar 

  • Rothenberg, S., & Zyglidopolous, S. C. (2007). Determinants of environmental innovation adoption in the printing industry: The importance of task environment. Business Strategy and Environment, 16(1), 39–49.

    Article  Google Scholar 

  • Russo, M. V., & Fouts, P. A. (1997). A resource-based perspective on corporate environmental performance and profitability. Academy of Management Journal, 40(3), 534–559.

    Article  Google Scholar 

  • Sarkis, J. (1995). Supply chain management and environmentally conscious design and manufacturing. International Journal of Environmentally Conscious Design and Manufacturing, 4(2), 43–52.

    Google Scholar 

  • Scherer, F. (1999). New perspectives on economics growth and technological innovation. Washington, DC: Brookings Institution Press.

    Google Scholar 

  • Sharma, S., & Vredenburg, H. (1998). Proactive corporate environmental strategy and the development of competitively valuable organizational capabilities. Strategic Management Journal, 19(8), 729–753.

    Article  Google Scholar 

  • Vaidyanathan, B. (2008). Corporate giving: A literature review. Center for the Study of Religion and Society, University of Notre Dame.

    Google Scholar 

  • Vogel, D. (2005). The market for virtue: The potential and limits of corporate social responsibility. Washington, DC: The Brookings Institution.

    Google Scholar 

  • Waddock, S., & Graves, S. (1997). The corporate social performance—Financial performance link. Strategic Management Journal, 18(4), 303–319.

    Article  Google Scholar 

  • Watkins, R. D., & Granoff, B. (1992). Introduction to environmentally conscious manufacturing. International Journal of Environmentally Conscious Design and Manufacturing, 1(1), 5–11.

    Google Scholar 

  • Weber, O., Koellner, T., Habegger, D., Steffensen, H., & Ohnemus, P. (2008). The relation between sustainability performance and financial performance of firms. Progress in Industrial Ecology, 5(3), 236–254.

    Article  Google Scholar 

  • Wernerfelt, B. (1984). A resource-based view of the firm. Strategic Management Journal, 5(2), 171–180.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Jean D. Kabongo .

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2013 Springer-Verlag Berlin Heidelberg

About this chapter

Cite this chapter

Kabongo, J.D., Okpara, J.O. (2013). Environmental Performance: The Impact of R&D Intensity on Firms’ Environmental Concerns. In: Okpara, J., Idowu, S. (eds) Corporate Social Responsibility. CSR, Sustainability, Ethics & Governance. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-40975-2_6

Download citation

Publish with us

Policies and ethics