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Environmental management practices and financial performance using data envelopment analysis in Japan: the mediating role of environmental performance

Environmental management practices and financial performance using data envelopment analysis in Japan: the mediating role of environmental performance
Environmental management practices and financial performance using data envelopment analysis in Japan: the mediating role of environmental performance
This study investigates the relationship between environmental management practices (EMPs) and financial performance (FP), and consequently ascertain whether environmental performance (EP) can mediate the EMPs–FP nexus. Distinctly using data envelopment analysis and generalised method of moments techniques to analyse a comprehensive dataset of Nikkei 225 listed firms from 2007 to 2018 (1,920 firm-year observations), our findings first suggest that EMPs have a positive effect on FP. Second, the desired EP can be achieved through the adoption of comprehensive EMPs. Third, improved EP has a substantial impact on shaping the EMPs’ effect on FP. These findings are consistent with the predictions of resource-based view and institutional theories. The results are robust to controlling for different types of alternative measures and endogeneities. The findings have important implications for academics, investors, managers, policy-makers, and regulators.
Environmental management practices, data envelopment analysis, environmental performance, financial performance, institutional theory, resource-based view
0964-4733
Elmagrhi, Mohamed H.
4961f329-8a2d-47c5-83ee-34fc058030fe
Aslam, Shoaib
861bd306-4bbe-45ca-ac97-d04a22f63b6f
Rehman, Ramiz ur
20fb2646-ebe9-4e1e-a476-d8540fe78573
Ntim, Collins
1f344edc-8005-4e96-8972-d56c4dade46b
Elmagrhi, Mohamed H.
4961f329-8a2d-47c5-83ee-34fc058030fe
Aslam, Shoaib
861bd306-4bbe-45ca-ac97-d04a22f63b6f
Rehman, Ramiz ur
20fb2646-ebe9-4e1e-a476-d8540fe78573
Ntim, Collins
1f344edc-8005-4e96-8972-d56c4dade46b

Elmagrhi, Mohamed H., Aslam, Shoaib, Rehman, Ramiz ur and Ntim, Collins (2020) Environmental management practices and financial performance using data envelopment analysis in Japan: the mediating role of environmental performance. Business Strategy and the Environment. (doi:10.1002/bse.2700). (In Press)

Record type: Article

Abstract

This study investigates the relationship between environmental management practices (EMPs) and financial performance (FP), and consequently ascertain whether environmental performance (EP) can mediate the EMPs–FP nexus. Distinctly using data envelopment analysis and generalised method of moments techniques to analyse a comprehensive dataset of Nikkei 225 listed firms from 2007 to 2018 (1,920 firm-year observations), our findings first suggest that EMPs have a positive effect on FP. Second, the desired EP can be achieved through the adoption of comprehensive EMPs. Third, improved EP has a substantial impact on shaping the EMPs’ effect on FP. These findings are consistent with the predictions of resource-based view and institutional theories. The results are robust to controlling for different types of alternative measures and endogeneities. The findings have important implications for academics, investors, managers, policy-makers, and regulators.

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BSE_ACCEPTED_19_11_2020 - Accepted Manuscript
Restricted to Repository staff only until 19 November 2022.
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Accepted/In Press date: 19 November 2020
Keywords: Environmental management practices, data envelopment analysis, environmental performance, financial performance, institutional theory, resource-based view

Identifiers

Local EPrints ID: 445336
URI: http://eprints.soton.ac.uk/id/eprint/445336
ISSN: 0964-4733
PURE UUID: 4d5e45d4-82f4-40d5-8c76-059479ee059f
ORCID for Collins Ntim: ORCID iD orcid.org/0000-0002-1042-4056

Catalogue record

Date deposited: 02 Dec 2020 17:32
Last modified: 26 Nov 2021 02:27

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Contributors

Author: Mohamed H. Elmagrhi
Author: Shoaib Aslam
Author: Ramiz ur Rehman
Author: Collins Ntim ORCID iD

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