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Why do firms set environmental performance goals?: Some evidence from organizational theory

Why do firms set environmental performance goals?: Some evidence from organizational theory Organizational goal setting is considered a critical strategic first step for corporations as it provides the basis for developing a roadmap for organizational activity as well as guidance for establishing the metrics to measure progress. Yet despite significant research interest in the environmental performance of corporations, environmental goal setting has received little attention. For example, it is not known why firms set environmental goals. Understanding this goal setting behavior is necessary to develop mechanisms to improve organizations' environmental management and performance. This study uses organizational change models of institutionalism, stakeholder management, natural selection, strategic choice and organizational learning to examine why firms set environmental performance goals. First, propositions related to environmental goal setting are developed from the models. The goal setting propositions use the goals of the US EPA's 33/50 programme, a national voluntary pollution prevention effort which aimed for a 33% reduction in releases by 1993 and a 50% reduction by 1995, as a basis for comparison to individual company goal setting. Next, the toxic release reduction goals of the 118 US corporations who set goals are analysed to determine which organizational change model propositions they support. All five models of organizational change examined here–institutionalism, stakeholder management, natural selection, strategic choice and organizational learning–show some promise in explaining corporate environmental goal setting. The combination of these models leads to the following depiction of the motivation for toxic release reduction. Firms will set goals to reduce toxic releases in an effort to respond to regulators and other factors in the institutional and stakeholder environment. This goal setting is likely to be enhanced if it can be more directly tied to economic benefits such as cost savings or if it is chosen by natural selection. This in turn will promote organizational learning with the end result of better environmental and economic performance. These findings provide some empirical evidence on which to base strategies for improving corporate environmental management. Copyright © 1999 John Wiley & Sons, Ltd and ERP Environment. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Business Strategy and the Environment Wiley

Why do firms set environmental performance goals?: Some evidence from organizational theory

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References (14)

Publisher
Wiley
Copyright
Copyright © 1999 John Wiley & Sons, Ltd. and ERP Environment
ISSN
0964-4733
eISSN
1099-0836
DOI
10.1002/(SICI)1099-0836(199901/02)8:1<1::AID-BSE176>3.0.CO;2-G
Publisher site
See Article on Publisher Site

Abstract

Organizational goal setting is considered a critical strategic first step for corporations as it provides the basis for developing a roadmap for organizational activity as well as guidance for establishing the metrics to measure progress. Yet despite significant research interest in the environmental performance of corporations, environmental goal setting has received little attention. For example, it is not known why firms set environmental goals. Understanding this goal setting behavior is necessary to develop mechanisms to improve organizations' environmental management and performance. This study uses organizational change models of institutionalism, stakeholder management, natural selection, strategic choice and organizational learning to examine why firms set environmental performance goals. First, propositions related to environmental goal setting are developed from the models. The goal setting propositions use the goals of the US EPA's 33/50 programme, a national voluntary pollution prevention effort which aimed for a 33% reduction in releases by 1993 and a 50% reduction by 1995, as a basis for comparison to individual company goal setting. Next, the toxic release reduction goals of the 118 US corporations who set goals are analysed to determine which organizational change model propositions they support. All five models of organizational change examined here–institutionalism, stakeholder management, natural selection, strategic choice and organizational learning–show some promise in explaining corporate environmental goal setting. The combination of these models leads to the following depiction of the motivation for toxic release reduction. Firms will set goals to reduce toxic releases in an effort to respond to regulators and other factors in the institutional and stakeholder environment. This goal setting is likely to be enhanced if it can be more directly tied to economic benefits such as cost savings or if it is chosen by natural selection. This in turn will promote organizational learning with the end result of better environmental and economic performance. These findings provide some empirical evidence on which to base strategies for improving corporate environmental management. Copyright © 1999 John Wiley & Sons, Ltd and ERP Environment.

Journal

Business Strategy and the Environment – Wiley

Published: Jan 1, 1999

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