Impact of corporate culture on environmental performance
We examine the impact of corporate culture on environmental performance using a sample of 7199 firm-year observations over the period of 2002-2018. We find that stronger corporate culture improves environmental performance, measured by the amount of toxic chemical release (TCR). Our result is both s...
| Authors: | ; |
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| Format: | Electronic Article |
| Language: | English |
| Check availability: | HBZ Gateway |
| Interlibrary Loan: | Interlibrary Loan for the Fachinformationsdienste (Specialized Information Services in Germany) |
| Published: |
2025
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| In: |
Journal of business ethics
Year: 2025, Volume: 196, Issue: 1, Pages: 61-92 |
| Further subjects: | B
Corporate Culture
B Toxic chemical release B Aufsatz in Zeitschrift B Institutional ownership B Environmental Performance B Managerial ability |
| Online Access: |
Volltext (kostenfrei) Volltext (kostenfrei) |
| Summary: | We examine the impact of corporate culture on environmental performance using a sample of 7199 firm-year observations over the period of 2002-2018. We find that stronger corporate culture improves environmental performance, measured by the amount of toxic chemical release (TCR). Our result is both statistically and economically significant. We also show that cultural norms of innovation, quality and teamwork as well as a technology-oriented corporate culture have a greater impact on enhancing environmental performance. Further analyses show that managerial competence and strong institutional ownership moderate the relationship between corporate culture and environmental performance. We introduce the decomposition of expected and unexpected components of TCR and document that firms with a strong corporate culture implement strategies to reduce the unexpected component of TCR in addition to the expected component of TCR. Finally, we document that strong corporate culture and environmental performance improve firms’ financial performance. Our results are robust to several sensitivity tests and procedures to mitigate endogeneity and self-selection problems. From a practical point of view, our findings suggest that a firm’s culture can determine its environmental sustainability and ethical practices. |
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| ISSN: | 1573-0697 |
| Contains: | Enthalten in: Journal of business ethics
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| Persistent identifiers: | DOI: 10.1007/s10551-024-05674-3 |
