Green practices: When do corporations respond to stakeholders' pressure?

Oct 23, 2008

In a new study published in Strategic Management Journal, researchers explain when external stakeholders can effectively influence organizations to adopt greener management practices. In an effort to appease the demands of external stakeholders, supervisors of facilities appear to adopt management practices that are favorable to their professional network. As a result, competing firms may adopt very different environmental management practices according not only to the level of pressure exerted by external stakeholders but also to the internal structure of the organization.

Magali A. Delmas and Michael W. Toffel, authors of "Organizational Reponses to Environmental Demands: Opening the Black Box", include customers, regulators, local communities, and environmental activist organizations in their definition of external stakeholders.

The study used data from an original mail survey and publicly available databases. The survey gathered information about perceptions of institutional pressures, relative influence of various corporate functional departments, and the management practices adopted by each facility. Existing databases provided additional measures of institutional pressures.

The authors argue that differences in the organizational structure of the firm are key to explain such differences. Pressures from external stakeholders are channeled to different organizational functions, which influence how they are received by facility managers. These differences in receptivity are critical because they, in turn, influence organizations' responses in terms of adopting management practices. In other words, some organizations will allow pressures from stakeholders to permeate the organization.

The authors find that firms with powerful marketing departments were more responsive to pressures from customers and competitors, and were especially likely to adopt the ISO 14001 Environmental Management System standard.

In contrast, they find that firms with powerful legal departments were more responsive to pressures from regulators and environmental NGOs, and were especially likely to adopt government-initiated voluntary programs. However, these firms were less likely to adopt the ISO 14001 standard, which requires substantial documentation which could pose concerns about legal liability.

So powerful departments can also help firms resist to the pressures exerted by external stakeholders.

Source: Wiley

Explore further: Corporate interest is a problem for research into open-access publishing

add to favorites email to friend print save as pdf

Related Stories

Body by smartphone

Jul 30, 2014

We love our smartphones. Since they marched out of the corporate world and into the hands of consumers about 10 years ago, we've relied more and more on our iPhone and Android devices to organize our schedules, ...

What the UK Space Agency can teach Australia

Jul 24, 2014

Australia has had an active civil space program since 1947 but has much to learn if it is to capture a bigger share of growing billion dollar global space industry. ...

Recommended for you

UC Santa Barbara receives $65M from Munger

21 hours ago

A physics institute at the University of California, Santa Barbara, has received a $65 million donation—the largest single gift in the university's history.

Prophet's ancient seal provides insights from antiquity

Oct 30, 2014

When a personal artifact of a religious leader is discovered nearly 1,700 years after its use, the object provides invaluable historical insights. Zsuzsanna Gulacsi, professor of Comparative Cultural Studies, ...

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.