101 Bansal-Roth 2000

Why Companies Go Green: A Model of Ecological Responsiveness
Author(s): Pratima Bansal and Kendall Roth

Source: The Academy of Management Journal, Vol. 43, No. 4 (Aug., 2000), pp. 717-736
Published by: Academy of Management
Stable URL: https://www.jstor.org/stable/1556363
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? Academy of Management Journal
2000, Vol. 43, No. 4, 717-736.
WHY COMPANIES GO GREEN:

A MODEL OF ECOLOGICAL RESPONSIVENESS
PRATIMA BANSAL
University of Western Ontario
KENDALL ROTH
University of South Carolina
We conducted a qualitative study of the motivations and contextual factors that induce
corporate ecological responsiveness. Analytic induction applied to data collected from
53 firms in the United Kingdom and Japan revealed three motivations: competitive-
ness, legitimation, and ecological responsibility. These motivations were influenced by
three contextual conditions: field cohesion, issue salience, and individual concern. In
this article, we also identify the conditions that likely lead to high corporate ecological
responsiveness.
During the last decade, researchers concerned in understanding corporate greening, their ability
with organizations and the natural environment to predict ecological responsiveness is limited. In
have investigated why firms respond to ecological particular, scholars have not detailed the concep-
issues. They have examined why some firms em- tual distinctiveness of alternate ecologically based
brace ecologically responsive initiatives, while oth- motivations or established whether the categories
ers in seemingly similar circumstances do not even of motivations are inclusive of all motivations or
comply with existing legislation. Understanding are mutually exclusive of each other. Furthermore,
the motives for corporate ecological responsiveness extant research lacks clarity as to how motivations
is critical for two reasons. First, this understanding differ and what contexts lead to particular motiva-
could assist organizational theorists to predict eco- tions. Similarly, although researchers acknowledge
logically based behaviors. For example, if corpora- that alternate motivations are associated with dif-
tions adopt ecologically responsive practices ferent forms of ecological responsiveness, this rela-
merely to meet legislative requirements, then firmstionship has not been fully specified in the litera-
will engage in only those activities that are man- ture or identified as relevant. Thus, a significant
dated. Second, this understanding could expose research opportunity exists to develop a model that
the mechanisms that foster ecologically sustainable identifies distinct conceptual categories of ecolog-
organizations, allowing researchers, managers, and
ical motivations and the corresponding anteced-
policy makers to determine the relative efficacy of ents and outcomes associated with each motiva-
command and control mechanisms, market mea-
tion.
sures, and voluntary measures.
The purpose of this study was to examine why
Several studies have identified motives for cor-
companies "go green" and, in so doing, to refine a
porate "greening," such as regulatory compliance,
model that explains corporate ecological respon-
competitive advantage, stakeholder pressures, eth-
siveness by identifying motivations for adopting
ical concerns, critical events, and top management
ecological initiatives and the underlying factors
initiative (Dillon & Fischer, 1992; Lampe, Ellis,
that lead to each motivation. For the purposes of
& Drummond, 1991; Lawrence & Morell, 1995;
this study, we define corporate ecological respon-
Vredenburg & Westley, 1993; Winn, 1995). Al-
siveness as a set of corporate initiatives aimed at
though these studies illustrate widespread interest
mitigating a firm's impact on the natural environ-
ment. These initiatives can include changes to the
firm's products, processes, and policies, such as
We would like to thank Keith Grint and Elizabeth
reducing energy consumption and waste genera-
Howard for their assistance in the development of this
tion, using ecologically sustainable resources, and
project and Karen Golden-Biddle, Susan Houghton, Ben
Oviatt and, especially, Christine Oliver for commentsimplementing
on an environmental management sys-
drafts of this article. We would also like to thank IBM, tem. Our concept of corporate ecological respon-
P&O, the Sasakawa Foundation, and Templeton College siveness refers not to what a firm should do, but to
for their financial support. the initiatives that reduce the firm's "ecological
717
718 Academy of Management Journal August
footprint" (Hart, 1997). Prior literature on organiza-

logical responsiveness. By intensifying production
tions and the natural environment provided an ini- processes, firms reduce their environmental im-
tial foundation for our conceptual model of corpo- pacts while simultaneously lowering the costs of
rate ecological responsiveness. inputs and waste disposal (Cordano, 1993; Lampe
et al., 1991; Porter & van der Linde, 1995). Reve-
nues can be improved through green marketing, the
BACKGROUND AND A PRELIMINARY MODEL
sale of waste products, and outsourcing a firm's
Prior research on organizations and the natural environmental expertise (Cordano, 1993). Rent-
environment has identified four drivers of earning corpo- firm-based resources, such as corporate
rate ecological response: legislation, stakeholder reputation (Hart, 1995; Russo & Fouts, 1997), learn-
pressures, economic opportunities, and ethical mo- ing capabilities (Bonifant, Arnold, & Long, 1995;
tives. The importance of legislation in inducing Hart, 1995), and product quality (Shrivastava,
corporate ecological responsiveness has been 1995), can be developed through corporate ecolog-
widely recognized (Lampe et al., 1991; Lawrence & ical activities.
Morell, 1995; Post, 1994; Vredenburg & Westley, Ethically motivated firms respond because it is
1993). Escalating penalties, fines, and legal costs the "right thing to do" (Lampe et al., 1975; Wood,
have punctuated the importance of complying with 1991). Top management team members (Andersson
legislation (Cordano, 1993). Furthermore, firms can & Batemen, 1998; Lawrence & Morell, 1995; Winn,
avoid expensive capital refits by keeping ahead of 1995) and company values (Buchholz, 1993) are
legislation (Lampe et al., 1991). instrumental in encouraging these firms to evaluate
Stakeholders have also been instrumental in in- their role in society.
ducing corporate ecological responsiveness. Cus- Our preliminary model of the antecedent condi-
tomers, local communities, environmental interest tions of corporate ecological responsiveness, de-
groups, and even the natural environment itself rived from the literature reviewed above, is illus-
encourage firms to consider ecological impacts in trated in Figure 1. The motives outlined in the
their decision making (Berry & Rondinelli, 1998; figure suggest that firms may be ecologically re-
Bucholz, 1991; Lawrence & Morell, 1995; Starik, sponsive to comply with legislation, to build better
1995). Managers are able to avert negative public stakeholder relationships, to acquire economic
attention and build stakeholder support by being wealth and competitive advantage, and to maintain
responsive (Cordano, 1993; Dillon & Fischer, 1992). ecological balance. Although this model provides
Lawrence and Morell (1995), however, found that an important starting place, it has two limitations.
shareholders seemed to have little effect on corpo- First, the data that ground this model are inade-
rate ecological responses. quate. Few past studies have systematically col-
Economic opportunities also drive corporate eco- lected a broad range of data to determine if organi-
FIGURE 1
A Preliminary Model of Corporate Ecological Responsiveness
DRIVERS
Legislation
Stakeholder
pressures
Corporate ecological
responsiveness
Economic
opportunities
Leadership *> Ethical motives

corporate values
2000 Bansal and Roth 719
zational motives actually explained corporate to be representative of a population, in theoretical

ecological responses. These studies' frequent reli- sampling, cases are selected to highlight theoretical
ance on a few case studies also constrains the gen- issues and to refute or challenge the theory being
eralizability of their findings. Second, the model is tested (Eisenhardt, 1989; Glaser & Strauss, 1967;
not fully specified. The constructs and their under- Pettigrew, 1990). We examined a relatively large
lying relationships require greater precision in or- number of cases to ensure diversity of practices and
der to be predictive. To understand ecologically contexts and thus increase the potential robustness
sustainable organizations, we need to further ex- of the theory induced from the results. We used two
plore the contexts that precipitate these motiva- parallel selection processes: (1) a formal selection
tions and their interactions. of a series of five sets of case studies (each referred
to as a data set), to build substantive theory, and (2)
a more focused selection of ten individual case
METHODS
studies, to address specific theoretical questions.
The purpose of our research project was to de- In the first selection process, theoretical differ-
velop a robust model of the motives for corporate ences cut across sets of case studies. To increase
ecological responsiveness. To develop theory that reliability, we collected data from multiple firms
is empirically grounded, an inductive methodology within a data set that represented the same theoret-
is appropriate (Glaser & Strauss, 1967; Yin, 1989). ical dimensions. The data sets included food retail-
Of the two inductive methodologies, grounded the- ers, subsidiaries of the diversified Britain-based
ory and analytic induction, we chose analytic in- multinational P&O, auto manufacturers, oil compa-
duction because it explicitly accommodates exist- nies, and Japan-based companies. We describe the
ing theories (Manning, 1982). Using this approach, data sets below in the chronological order in which
we went back and forth between data collection they were sampled.
and theory generation, beginning with a review of Food retailers. Twelve of the 14 largest food
the literature to develop a set of hypotheses. Withretailers in the United Kingdom were included in
analytic induction, researchers collect data in- this data set. The corporate head offices of all of the
tended to challenge their emerging hypotheses, in food retailers included in this data set were in the
an effort to develop theory (Manning, 1982). The United Kingdom, although some had operations
relevant literature is visited, the hypotheses modi- outside of the country. We selected individual
fied, and another set of data collected. Discrepan- cases for this data set by approaching all large firms
cies between existing theory and the data are rec- within the industry and soliciting their involve-
onciled in the subsequent iteration. Closure is ment. We chose this data set for three reasons. First,
achieved when the differences between the col- food retailers were facing a wide range of ecological
lected data and developed theory are small (Den- issues, including the congestion related to in-town
zin, 1989; Frankfort-Nachmias, & Nachmias, 1992; hypermarket sites, the use of greenfield sites, the
Glaser & Strauss, 1967). emissions resulting from the distribution of their
In collecting data for this study, we sought to products, energy management of shop operations,
obtain information both broad and deep enough to excess packaging associated with products, transit
ensure a rich accumulation of data from which to packaging, and carrier bags, life cycle analysis of
draw inferences. To this end, we collected data own-brand products (in which the ecological costs
from multiple sources, including in-depth inter- of a good are calculated over the life of the good),
views, participant observations, and archival doc- "ecolabeling" of their own brands and competitors'
uments. The first author collected data from 1993 brands, and providing recycling bins for local com-
to 1995 from a total of 53 companies in several munities. Second, firms were particularly homoge-
countries and in multiple industries, to support nous in the products they offered, in ecological
interindustry and international comparisons. The effects, and organizational structure and size
research also focused on both stated intentions and (Simms, 1991). Third, the environmental policies
observable outcomes as a way to increase the reli- of the sector had not been widely studied, so it
ability of the findings. provided a domain in which interviewees were less
likely to respond with existing rhetoric.
P&O subsidiaries. To assess the importance of
Sampling
internal corporate structure and culture in motivat-
We applied theoretical sampling, the recom- ing a corporate environmental policy, we then se-
mended approach to analytic induction, in select- lected a group of firms under the same organiza-
ing the case studies (Denzin, 1989). In contrast to tional umbrella: ten subsidiaries and the corporate
statistical sampling, in which a sample is designed headquarters of P&O, a large, diversified, Britain-
based multinational. In consultation with the envi- press. The oil industry, in contrast, has a high level
ronmental director of P&O, we attempted to select a of cohesion and interaction among firms, low prod-
diverse group of subsidiaries that operated in dif- uct differentiation, and a negative ecological image
ferent industries and exhibited different attitudes (Adelman, 1987). This sector also differs from the
towards the natural environment. The P&O compa- other sectors we studied in that it relies heavily on
nies were firms within the construction, trucking, primary products, rather than on manufacturing
cruise, distribution, ferries, and property manage- and services, which permitted variation in the eco-
ment industries. P&O was chosen for two reasons. logical effects. Also, firms in this sector did not
First, it was a large diversified company that per- interact with consumers and local communities as
mitted an analysis across industry sectors, so that directly as firms in the other sectors.
the effects of organizational structure and culture Japanese companies. Given the importance of
could be better isolated. Second, because a clear the institutional context in influencing a firm's eco-
corporate direction had been established through logical practices, we chose the final data set to
the P&O Group corporate environmental policy, we challenge the emerging theory in a different cul-
could assess the influence of the head office on the tural context. We included ten major Japanese
environmental practices of its subsidiaries. Prelim- firms in this data set, all very large multinationals
inary analysis of the P&O data set showed that, operating in the following industries: auto manu-
although the corporation did influence the subsid- facturing, oil, steel, chemicals, utilities, and elec-
iaries' adoption of environmental practices, differ- tronics. Japan offered a dramatically different cul-
ences among subsidiaries were better explained by tural and institutional context from Britain's
industry influences than by corporate influences. (Hofstede, 1980), and yet the firms were at simi
Auto manufacturers. We included five firms points of industrialization. We also anticipated t
that manufactured automobiles in the United King- firms in the United Kingdom and Japan experi-
dom in this data set. The names of the firms in this enced similar ecological issues because of their
industry were extracted from the Excel database, a island geographies. Gaining participation from
United Kingdom-based database that provides sta- Japanese firms proved to be challenging. Although
tistical data for publicly listed firms. We selected an effort was made initially to include firms in the
individual cases by approaching the seven major auto manufacturing and oil industries, to contrast
U.K. manufacturers in this industry. Six firms directly with the U.K. data, such access was not
agreed to participate, although a mutually accept- easily secured. Consequently, we used cold calls
able appointment time could not be reached with and chain sampling through personal contacts,
one manufacturer. Of the five auto manufacturers which led to participation of a wider range of in-
studied, four were headquartered in the United dustries than initially anticipated. Because indus-
Kingdom, and one was headquartered in France. try-related factors are important in organizational
We selected auto manufacturers as the third data responses, all of the Japanese firms had at least one
set in an effort to capture the pertinent sectoral match in the United Kingdom.
factors that influenced corporate ecological re- The theoretical dimensions represented by these
sponses, as indicated by data from P&O. Three di- data sets reflected differences in some of the con-
mensions appeared pertinent to the emerging the- textual variables that emerged during data analysis,
ory: the influence of customers and local in particular, issue salience, field cohesion, and
communities, the direct contact that an organiza- individual concern. The generalizability of our
tion had with customers, and the types of ecologi- model, therefore, is limited to the degree to which
cal impacts. Auto manufacturers were considered the contextual variables were relevant to the con-
informative because they hired local community text being evaluated.
members, did not retail directly to consumers, and Single case studies. The firms chosen for this
had ecological impacts centered on manufacturing sample were conceptually distinct from those in
processes. the above five data sets across several dimensions:
Oil companies. This data set included compa- size, ownership, industry, and country. This data
nies that were involved in the extraction or refining set included a small firm, a family-owned firm, a
of oil in the United Kingdom. We approached diversified German industrial firm, two govern-
seven oil companies selected randomly from the ment-owned utilities, and firms in the electronics,
Excel database to participate in this study, and five
information management, automotive parts, and
agreed. We selected oil companies as the fourth chemicals industries. In addition to selecting firms
data set because food retailers and auto manufac- for this group of ten for theoretical reasons, we also
turers were in highly fragmented sectors and expe-selected firms for the group opportunistically, to
rienced relatively little negative environmental ensure that we accounted for specific biases in the
theoretical sampling (such as bias due to firms' consistencies further (Eisenhardt, 1989). In addi-
ready agreement to discuss their environmental tion, respondents were asked about the companies'
policies). relationships with stakeholders and about other
Using single case studies permitted us to chal- key aspects of firm strategy, structure, and opera-
lenge and understand specific issues that emerged. tions. As the research project progressed and the
For example, the data suggested that family-owned theory was refined, interview questions became
businesses are motivated differently from busi- more focused, as we tried to ascribe more detail to
nesses with unrelated shareholders. Consequently, the emerging patterns. After the main part of each
a case study of a family-owned business provided interview was completed, if time permitted we
an assessment of whether the theory was influ- asked respondents to comment directly on specific
enced by type of organizational ownership. Al- aspects of the emerging theory. The specific aspect
though analyzing data from a single case study does of the theory probed depended on the interviewees'
not build reliability in extending theory, here it circumstances. For example, if, according to an in-
helped to confirm whether the issue being consid- terviewee, it appeared that her or his firm was
ered represented a theoretical difference and war- motivated by legitimation, we asked if legitimation,
ranted further consideration. For these single case ecological responsibility, or competitiveness best
studies, there was insufficient evidence to suggest described the firm's motivations. In addition, we
that another data set was required. asked the interviewees to comment on the rele-
vance of the contextual variables. These data pro-
vided greater face validity to the emerging model
Data Sources
and, because we asked such questions later in the
Interviews. We based selection of our key infor- interviews, the integrity of the core data was pre-
mants on their knowledge about the ecologically served.
oriented initiatives of their firms and the underly- Participant observations. Early in the study, the
ing reasons for the initiatives. Thus, we identified first author observed training seminars at two large
environmental managers or environmental direc- U.K. firms, P&O and Thames Water, and took ex-
tors as the primary key informants. In 15 cases, a tensive notes. In these seminars, the environmental
company did not have an environmental manager. managers discussed corporate environmental poli-
In these firms, we interviewed multiple senior cies with senior managers. As these observations
managers. We perceived no systematic bias in the were made at the beginning of the research process,
context descriptions, motivational dimensions, or they served to highlight some of the issues and
firm initiatives, but we also gathered secondary concerns raised by organization members who
data for each company to assess the reliability of were not convinced of the value of ecologically
the key informants. responsive initiatives. Hence, they identified some
In total, we conducted 88 interviews, most last- of the factors that motivated or stalled the adoption
ing between one and two hours. The list of inter- of ecologically responsive practices. Although
views is provided in Table 1. We conducted 5 in- these observations were not coded, they were in-
terviews by telephone rather than on site owing to strumental in shaping initial conceptualizations of
logistical constraints. All but 10 interviews were an advanced model of corporate ecological respon-
tape-recorded and then subsequently transcribed siveness. Approximately 60 hours were spent ob-
for use in the data analysis. We took detailed notes serving in these seminars, and approximately 500
during the interviews that were not recorded. The pages of single-spaced transcribed notes were com-
interviews that were not recorded did not lead to a piled from the participant observation activities.
systematic selection bias because they were distrib- Archival documents. We used data from pub-
uted randomly across the data sets. All interviews lished sources, a newspaper search of the Reuters
were conducted in English. As required, the inter- and Data Star databases, company accounts, annual
views with Japanese respondents were conducted reports, and corporate environmental reports to
with an interpreter provided by the interviewee. provide a background for the interviews. A case
We kept initial interviews broad in scope in an study of each firm, constructed prior to the inter-
effort to expose a wide range of motivations and view, included archival information on the firm's
guiding themes. We started each interview by ask- ecologically responsive activities, financial perfor-
ing what the firm had done with respect to the mance, and ecological impacts. This information
natural environment and then asked the respon- served to confirm the reliability of the interview-
dent to trace the history of each initiative he or she ees' responses and permitted more directed and
mentioned and to tell us why the initiative was detailed probing in the interviews. For example, if
adopted. To build internal validity, we probed in- a food retailer reported that it was the first to re-
TABLE 1 TABLE 1
List of Interviews (continued)
Number of Number of
Company Interviewees Company Interviewees
Food retailers Nippon Steel 2

Asda Group plc 3 Nissan Motor 2
Budgens Stores Ltd. 1 Petroleum Association of Japana 2
Co-operative Retail Society 1 Pioneer Electronics 3
Co-operative Wholesale Society Ltd. 2 Sophia Universitya 1
Gateway Foods 1 Sumitomo Corporation 1
Iceland Frozen Foods 1 Tokyo Electric Power Company (TEPCO) 2
Institute of Grocery Distributiona 1 Toshiba Corporation 3
J. Sainsbury plc 1 Ube Industries Ltd. 2
Kwik Save Group plc 1
Marks & Spencer plc 1 Total number of interviews with Japanese 28

Safeway 1 organizations
Tesco Stores Ltd. 1
Wm. Low & Co. plc 2 Single case studies

Albright & Wilson Ltd. 1
Total number of interviews with food retailers 17 British Telecommunications plc 1
Burmah Castrol 1
P&O companies Hewlett Packard 2
Bovis Construction Ltd. 1 IBM United Kingdom Ltd. 1
Bovis Homes Ltd. 1 Lucas Industries 1
Containerbase (Manchester) Ltd. 1 Seimens AG 1
P&O European Containers 1 Thames Water 1
P&O Cruises (UK) Ltd. 3 Warburton Ltd. 2
P&O Distribution Ltd. 2 Rank Xerox Ltd. 1
P&O European Ferries 1
P&O Group 1 Total number of interviews with single case 12

P&O Properties Ltd. 1 studies
P&O Tankers Ltd. 1
Princess Cruises 1 a Indicates a supplementary interview.
Total number of interviews with P&O 14
companies place chlorofluorocarbons (CFCs) in its refrigerants

with hydrochlorofluorocarbons (HCFCs), then we
Auto manufacturers
asked the respondent if the claim was true, the
IBC Vehicles Ltd. 2
Jaguar Ltd. 1
reasons for the replacement, the reasons for its
Peugeot Talbot Motor Co. plc 3 leadership position, and the reasons for reporting
Rover Group Ltd. 1 it. This process of probing highlighted the relation-
Vauxhall Motors Ltd. 2
ships among an innovation's context, rationale, and
process. We did not code the archival documents
Total number of interviews with auto 9
manufacturers because the objective was to investigate motiva-
tions and not outcomes. Because little archival in-
Oil companies formation was available on our selected Japanese
British Petroleum 3
companies, we supplemented the company inter-
Conoco Ltd. 1
views with eight interviews of knowledgeable rep-
Esso Petroleum Company Ltd. 1
Gulf Oil (UK) Ltd. 1 resentatives of relevant Japanese institutions, in-

Total Oil Great Britain Ltd. 2 cluding the Ministry of Trade and Industry (MITI),
the Keidanren (a multi-industry organization), an
Total number of interviews with oil companies 8
industry association, a university, and the Japanese
Auditing Organization.
Japanese organizations
Asahi Chemical 2
Idemitsu 1
Data Analysis
Japan Audit and Certification Organization for 1
Environment (JACO)a Identifying motivations and their key differen-

Keidenrana 1
tiating dimensions. Our goal was to isolate a mean-
MITIa 1
Nippon Oil Corporation 4

ingful set of motivations so that implications could
be drawn for future theory testing. It was important,
therefore, to identify a set of constructs that were of data collection and literature review. In general,
theoretically meaningful, internally consistent, ro- an iteration involved collecting data from archival
bust, and distinct. However, an ecological response sources and interviews, coding interview data, de-
could reflect multiple motivations, and any one veloping or refining emerging ideas, researching
motivation could be expressed in several ways. For existing theory, and selecting more data for the next
example, a food retailer that performs a life cycle round of data collection. Early stages of data col-
analysis of its own-brand products could say that it lection pointed us to prior research in sustainable
had several motivations: "It was the right thing to development, corporate social responsibility, insti-
do," "This is the direction of the future," or "It tutional theory, strategic management theory,
could differentiate us among our competitors." It stakeholder management theory, resource depen-
was critical, then, for our analyses to apply insights dence theory, and the resource-based view of the
developed in other research streams. It was also firm. As the data collection progressed, the existing
important to discriminate between the constructs relevant theory became more apparent, and we
so that they could be tested empirically later. What probed deeper into specific theories. In total, we
are assumed to be distinct differences in constructs
completed five iterations of the data sets.
often converge and blur as theories evolve (Wright, Given that the theory emerged over multiple it-
1985), and the emphasis of this project on integrat- erations of data collection, we were concerned that
ing theory required careful consideration of the the theory might have evolved so significantly that
critical differences between the constructs.
it no longer described early data. Using the final
To derive valid constructs, we conducted two
codes of the differentiating dimensions, we re-
types of analyses: identifying motivations by com- coded all of the data with the assistance of the
paring actions with expressed motivations, and
electronic software QSR NUD*IST. This software
identifying the relevant dimensions of the motiva-
permitted us to view all of the text with the same
tions that help discriminate among them. First, we
code simultaneously so the large amount of data was
chronicled the ecological responses of each firm
more easily handled. Summaries were generated for
and then listed the corresponding motivations.
each differentiating dimension and contrasted with
From these lists, we generated a table that listed all
the motivation or motivations assigned to a firm. This
possible initiatives by their corresponding motiva-
reanalysis confirmed the validity of three motivations
tions. This table was completed for each firm. If a
and their key differentiating dimensions, although we
firm engaged in a substantial number of initiatives
made minor adjustments to the labels used. For ex-
that were unique to a single motivation, we labeled
ample, in the initial analysis, we labeled the motiva-
it as having a dominant orientation (competitive-
tion "competitiveness" as "profit orientation," but we
ness, legitimation, or ecological responsibility).
Most firms could be associated with a dominant mo- later felt that the latter inaccurately highlighted the
importance of financial returns.
tivation. In the early rounds of data analysis, we used
categories that were more descriptive than analytical To examine the validity of the differentiating di-
(for instance, legislation, stakeholder pressures, prof- mensions, we asked an independent rater to code
its) and developed theoretically tighter categories as the data pertaining to food retailers. This data set
data collection and analysis proceeded. was selected because it was the largest and had a
We also coded the interview transcripts for other balanced representation of all of the firm motiva-
variables that could help define the motivations. tions. The rater was given the differentiating di-
We coded variables that included cost reduction, mensions and asked to assign a dominant motiva-
increasing market share, reaction to competitors, tion to each firm. The rater coded each of the
reaction to consumers, building resources, sur- interview transcripts from the food retailers, pro-
vival, legislation, avoiding penalties, license to op- duced summary sheets of the differentiating di-
erate, managing risks, doing the right thing, and mensions, and independently assigned a dominant
avoiding personal risk. We summarized the codes motivation. The rater and the first author agreed on
for each firm, and a distinct pattern of differences 10 of the 12 firms. For those on which the rater and
between the firms with dominant motivations be- first author disagreed, the differences were easily
gan to emerge. We ultimately labeled these motiva- reconciled because of the low internal validity in
tions "competitiveness," "legitimation," and "eco- the interviewees' responses and archival docu-
logical responsibility." Attributes of ends, means, ments. Given the high degree of agreement, the
constituent focus, decision analysis, decision rule, expectation that the 41 remaining firms would ex-
and strategic posture served to discriminate among hibit the same properties, and the time intensity of
the motivations. this task, we did not replicate this exercise for the
The model emerged from the multiple iterations remaining firms.
Developing contextual variables. In addition to petitiveness through lower costs. For example, many
considering motivations, to develop a model of eco- firms turned off lights in the evening and carefully
logical responsiveness we had to understand the monitored air conditioning. Other firms sold or recy-
context in which these motivations would arise. cled waste in an effort to generate revenue. Consistent
For example, we could gain greater insights aboutwith the resource-based view, firms attempted to de-
the legitimation motivation by determining when velop it ecologically related resources and capabilities
was more pervasive. Thus, we also analyzed the to build long-term profit potential (Hart, 1995), such
interview transcripts to code the different internal as improved reputation, process efficiencies, and
and external conditions that influence the propen- product reliability. These resources and capabilities
sity of a firm to adopt a specific motivation. We also were developed through green marketing, source re-
drew insights about the external context from ar- ductions and process intensification, and new capital
chival documents concerning industry characteris- equipment. Some respondents also indicated that it
tics, Britain/Japan comparisons, information per- was easier to hire quality employees if a firm had a
taining to P&O, and so forth. We summarized the better reputation. Competitively motivated firms en-
codes for each firm and, in the process of develop- gaged in more visible activities to improve their cor-
ing motivations, a valid set of contextual condi- porate environmental reputations. These activities
tions emerged that could be related to the dominant served to enhance the firms' competitive advantage.
motivations: issue salience, field cohesion, and Competitiveness, in contrast to other motiva-
ecological responsibility. tions, resulted in greater attention paid to the cost-
benefit analyses of ecological responses. For exam-
ple, the following sentiment was expressed by one
MOTIVATIONS FOR CORPORATE
respondent and echoed by several others: "Once
ECOLOGICAL RESPONSIVENESS
you have the investment, then maybe the benefit
As noted, the data analysis suggested three versus basic the payment costs may be of economic value
motivations for ecological responsiveness: compet- over the long term." Respondents often focused on
itiveness, legitimation, and ecological responsibil- the "numbers" of ecological responsiveness, ex-
ity. Exemplary data supporting the motivations pressing
and concerns epitomized by phrases like
an indication of their pervasiveness are provided "costs,"
in"accurate science," "customers will not
Table 2. The salient dimensions that discriminate pay," and "the company share price." Another dis-
among the motivations are provided in Table 3. Thetinguishing characteristic of these firms was that
initiatives and benefits associated with each moti- they chose the options that they believed secured
vation are provided in Table 4. the highest returns, independent of their ecological
consequences. These firms often excluded environ-
mental impact assessments from their decision
Competitiveness
making. Only after a decision was made was the
We define the term "competitiveness" here as the relative ecological impact recognized. For example,
potential for ecological responsiveness to improve an oil company installed pipelines to transport oil
long-term profitability. According to respondents, throughout the United Kingdom. This option has,
ecological responses that improved competitive- arguably, less ecological impact than its alterna-
ness included energy and waste management, tives, but the decision to lay pipeline rather than
source reductions resulting in a higher output for use freighters was motivated by the cost savings
the same inputs (process intensification), ecolabel- resulting from the large volume of oil transported,
ing and green marketing, and the development of not the ecological consequences. Under the moti-
"ecoproducts." vation of competitiveness, social initiatives are
In terms of salient characteristics, interviewees adopted only if they serve to enhance a firm's fi-
from firms motivated by competitiveness expected nancial performance.
that their ecological responsiveness led to sustained Firms motivated by competitiveness actively in-
advantage and hence improved their long-term prof- novated ecologically benign processes and prod-
itability. A respondent from a Japanese firm reported ucts to enhance their market positions. Nehrt
this: "Firms compete on price and quality and are (1996) showed that the first paper pulp companies
now competing more on the environmental issues, as to employ environmental technologies realized
well. Competitive advantage can be gained through higher profits. Similarly, in this study, one Japa-
environmental responsibility." Many of these initia- nese chemical firm was developing a new process
tives were relatively simple housekeeping measures that allowed more efficient recycling of paper. An-
that required minor changes to processes but im- other Japanese firm reduced the level of benzene (a
proved operational efficiency, which increased com- toxic substance) in its petroleum products because
TABLE 2
Motivations for Ecological Responsiveness
Number of Firms
Showing Strong
Motivation Exemplary Quotes Evidence
Competitiveness It was seen as good business3 food retailers

manageme
which has value. Environmental initiatives are seen as both an environmental 1 P&O company
opportunity and a business opportunity. 2 Japanese companies
1 other
There are a number of firms which are thinking about how to establish an
ecobusiness.... The expense for environmental conservation is becoming so big that
there are plenty of business opportunities.
Jealousy, competitiveness, call it what you like. That is what drives the organization.
It is greed and competition.
And I suppose if we're brutally honest about it, if environmental issues have volume,
put money in the till, then it will become a primary consideration.
We did environmental management because of our concern for citizenship. Yet, in the
end, this can be related to money.
Environment is going to be some kind of business strategy.
Legitimation The worst scenario is that we do something stupid and then we pay for it in the way 1 food retailer
of fines, penalties, and lousy reputation. 5 auto manufacturers
4 oil companies
At the end of the day, we are talking about insurance. 7 P&O companies
2 Japanese companies
We wanted improve the image . .. and make it easier for us to operate. 5 others
The business issues are forced home through stakeholders, which include customers,
employees, shareholders, peer competitors, suppliers, and increasingly more, the
local community.
We are trying to gain legitimacy or credibility with stakeholders and also with
competitors.
We will do what we need to do legally.
Social 3 food retailers

It's something that we can do, costs nothing to do it, and it's the right thing to do from
responsibility our standpoint, the right thing to do from the consumer's standpoint. 1 P&O company
Overall, when I show you our policy, the thing that we talk about in our policy is
being committed to working with government to find the best reward for what is
best for the environment. I don't mean what is best for our industry or for [us] but
what is best for society.
It's about being a good environmental citizen, about being responsible. There's nothing
wrong with doing good.
Proving that we are aware of what we should be doing . .. irrespective of the financial
situation of the business.
We are talking about managing a better company .... The "better" is that in the true
sense there is the moral better. We want to be because we can afford to be.
We've always recognized that the feel-good factor is important and this is just one of
the ways in which this is built up.
TABLE 3
Key Dimensions Differentiating Motivationsa
Key
Differentiating
Dimensions Competitiveness Legitimacy Social Responsibility
Ends Profitability Firm survival Corporate morale

Environmental initiatives must be Environmental management will There is a feel-good factor in
commercially viable .... We be institutionalized in the good everything surely. There has to
would have more difficulty as companies and the others will be.
managers in [this subsidiary] to disappear.
sell some ideas purely on feel-
good grounds.
Means Competitive advantage Compliance with norms and Social good

regulations
It is a question of providing If we don't comply, we will The commercial issue has been in
something that the consumer invariably go out of business part ignored. We don't believe
really wants which has the particularly if our petrol license that there are short-term quick
knock-on effect of increasing is withdrawn. fixes with regard to any of the
market share. issues that are serious issues.
Constituent focus Customers, investors Government, local community, Society

stakeholders
Our number one motivator in Really, it comes down to looking at We will eventually run out of
anything we do is that we want the stakeholders in total. This resources and grind to a halt. It
to be a consumer-responsive means looking at our customers, is not just a greenies' concern, it
company. at our employees, at our is society's concern.
shareholders. They expect
industry to be better.
Decision analysis Cost-benefit analysis Costs and risks of noncompliance Ecological values
They have to identify the relative It was environmental risk So the halon is gone. It cost us but
benefits to us. Foremost it has to management. ... our computer people can
be a financial benefit. walk around and say we don't
have halon protection.
Decision rule Maximize Satisfice Idealize

I am told by Corporate to seek To be brutally honest, it would be Because of the evolution process,
leadership.... It is the company the expectant of impending we try not to be pressured into
culture that we are committing legislation. The movement of the changes but to sit down and
to be the best in everything, legislative goalpost which will independently evaluate whether
including environment. usually take us to a decision like a real issue exists and should
that. anything and can anything be
done.
Strategic posture Innovative Isomorphic/imitative Independent

It is not a question of a large wallet
Industry does not want to be seen We pride ourselves in thinking
to buy something that will make as the first across the pulpit for that we have done a more
it all better. It usually requires issues which are indeterminate. thorough and well-thought-out
years of research to find There is too much risk in terms job [than our competitors].
something that will make it all of the ways in which the issue is
better. interpreted.
a Cells identify the aspect of each differentiating dimension pertinent to the focal motivation and give exemplary quotes fr
interviewees.
it discovered another use for the benzene. Several Legitimation

respondents indicated that if environmental sci-
ence was more definitive in assessing the ecologi- A motive of legitimation refers to the desire of a
cal impacts of alternative activities and if consum- firm to improve the appropriateness of its actions
ers were more demanding, then they would more within an established set of regulations, norms,
likely show greater ecological responsiveness. values, or beliefs (Suchman, 1995). Examples of
TABLE 4
Initiatives and Benefits Associated with the Motivations for Ecological Responsiveness
Motivation Ecologically Responsive Initiatives Anticipated Benefits
Competitiveness Housekeeping measures such as energy and waste Higher profits, process intensification, larger market
management, source reductions resulting in the share, lower costs, differentiation, higher share
same output for the same level of output, price, rent-earning resources and capabilities.
ecolabeling and green marketing, the development
of ecoproducts, and the adoption of environmental
management systems (EMS), such as BS 7750 and
the Eco-Management & Audit Scheme (EMAS).
Legitimation Complying with legislation, instating an Long-term sustainability, survival, license to operate,
environmental committee or environmental manager avoiding fines and penalties, lessening risks,
to oversee a firm's ecological impacts and advise employee satisfaction.
senior management, developing networks or
committees with local community representation,
conducting environmental audits, establishing an
emergency response system, and aligning the firm's
image with environmental advocates.
Social responsibility Redevelopment of local community areas to greenfield Feel-good factors, employee morale, individual
sites, the provision of a less profitable green product satisfaction.
line, donations to environmental interest groups and
other local community groups, use of recycled
paper, replacement of retail items or office products
with more ecologically benign items, and recycling
of office wastes.
legitimation as shown by the data included com- constraints made to avoid sanctions, as predicted
plying with legislation, establishing an environ- by Hart (1997) and Wood (1991). Often the corpo-
mental committee or environmental manager posi- rate environmental policies of these firms were
tion to oversee a firm's ecological impacts and aimed at keeping up with environmental regula-
advise senior management, developing networks or tions. Respondents indicated that specific stake-
committees with local community representation, holders, such as the local community, customers,
conducting environmental audits, establishing an and the government, articulated norms. Institu-
emergency response system, and aligning the firm tional pressures, viewed as an "iron cage" (DiMag-
with environmental advocates. gio & Powell, 1983), evoke images of passive com-
As outlined in Table 3, several salient character- pliance, with minimal latitude for negotiation or
istics differentiated this motivation from the other discretion-an image that fits the observations and
two motivations. Threats to a firm's legitimacy concerns expressed by these respondents.
were believed to undermine a firm's license to op- Firms motivated by legitimation were focused on
erate or its long-term survival. As one respondent the stakeholders most influential in prescribing or
said, "We don't want to disappear if we can help articulating legitimacy concerns. The Japanese
it.... Firms which don't have a policy will end up firms, for example, focused their attention on the
going out of business because they won't be ac- priorities articulated by the Keidanren, the MITI,
cepted by society." Respondents such as these em- and their industry associations. Customers and
phasized concerns such as "long-term sustainabil- shareholders imposed few direct requirements.
ity," "survival," and "license to operate." These British firms, in contrast, were sensitive to local
observations support the theoretical relationship community concerns and the perceptions of share-
between organizational legitimacy and organiza- holders. Hence, British firms aimed to avoid bad
tional survival (Meyer & Rowan, 1977; Zucker, publicity associated with their ecological effects.
1987). One respondent identified the purpose of compli-
The data suggested that legitimation was directed ance initiatives by saying, "I know our [environ-
toward complying with institutional norms and mental] policy is just a piece of paper. It is just for
regulations. A word frequently used by respon- making stakeholders nice and warm and cuddly."
dents was "compliance." Respondents focused not The decision analysis of these managers aimed to
on proactive efforts but on reactions to external reduce the costs and risks of noncompliance. Dis-
cussions focused not on what would occur if the phasized, which clearly differentiated this motiva-
firm met the conditions of stakeholders but, rather, tion from the other two. Firms acted out of a sense of
on what would happen if they did not. Hence, obligation, responsibility, or philanthropy rather than
many respondents identified concerns about "sanc- out of self-interest (Bucholz, 1991; L'Etang, 1995).
tions," "fines and penalties," "bad publicity," "pu- When asked why they undertook particular ecologi-
nitive damages," "avoiding clean-ups," "discon- cal responses, interviewees from ecologically respon-
tented employees and work force," and "risks." sible firms often indicated that it was the "right thing
These concerns were also reflected in the firms' to do," supporting the findings of Lampe and col-
initiatives in that they reduced risks rather than leagues (1991). Respondents claimed to derive "feel-
publicized their ecological responsiveness. good factors" from the initiatives. Hence, satisfaction
In accordance with efforts to avoid negative ef- and high employee morale were short-term benefits
fects, these respondents also aimed to "satis- from their ecological responses.
fice"-to meet standards rather than exceed them. Firms motivated by ecological responsibility of-
Since their goal was to minimize risks and costs, ten pointed to a single individual who had cham-
firms sought to ensure that their ecological re- pioned their ecological responses. The decision
sponses met the norms. Furthermore, the dominant process was often based on the values of powerful
approach of these firms was to imitate their peers. individuals or on the organization's values rather
As firms operating in close proximity were usually than a widely applied decision rule. This finding is
subject to the same regulations and social norms, consistent with studies by Lawrence and Morell
they often operated with similar standards in a (1995) and Winn (1995), which showed that firms'
socially cohesive environment. For example, all the top managements were responsible for the firms'
oil companies decided to postpone efforts to re- environmental management leadership. In addi-
cover volatile organic compounds. These firms tion, the ecologically responsible firms idealized,
adopted a more passive and imitative stance, not rather than rationalized, the best course of action.
only to minimize the risk of moving first into novel As one respondent indicated, "It's something that
production processes and strategies, but also to en- we can do, costs nothing to do, and it's the right
hance their legitimacy by imitating successful com- thing to do from our standpoint, and the right thing
petitors, as predicted by Abrahamson and Rosen- to do from the consumer's standpoint." As a result
kopf (1993). One respondent explained, "We of individual leadership and a desire to uncover the
generally do not lead when it comes to environ- most ecologically benign solutions, firms moti-
mental issues . . . there is quite a bit of risk associ- vated by ecological responsibility often chose inde-
ated with being first, along with a lot of money, pendent and innovative courses of action, rather
time, and grief." Consistent with institutional the- than mimicking other firms whose motive was le-
ory (DiMaggio & Powell, 1983), firms exhibited mi- gitimation. In essence, these firms were looking to
metic isomorphism in complying with institutional do the "right thing." As one respondent said, "If I
norms and pressures and were motivated to comply do something I want to do it wholeheartedly and
in order to establish their legitimacy and to avoid I'll want to believe in what I am doing." The deci-
sanctions for noncompliance. sion was based on ethical criteria; whether it was
financially optimal was irrelevant. Respondents ex-
pressed such views as "We feel some responsibility
Ecological Responsibility
to the environment," or "We must back up our
We viewed ecological responsibility as a motiva- environmental strategy with genuine concern for
tion that stems from the concern that a firm has for the environment."
its social obligations and values. Within the data,
initiatives motivated by ecological responsibility A MODEL OF CORPORATE ECOLOGICAL
included the redevelopment of previously used
RESPONSIVENESS: DEVELOPING TESTABLE
land to green areas, the provision of a less profit-
PROPOSITIONS
able green product line, donations to environmen-
tal interest groups and other local community In addition to identifying the motivations for
groups, the use of recycled paper, the replacement porate ecological responsiveness, the study also
of retail items or office products with ones more vealed the contexts of these motivations. Three
ecologically benign, and the recycling of office contextual dimensions influenced the dominant
wastes. motivations of firms: issue salience, field cohesion,
A salient feature of this motivation was a concern and individual concern. A model depicting the re-
for the social good. The ethical aspects of ecological lationships between the motivations and their con-
responsibility, rather than the pragmatic, were em- texts is provided in Figure 2. Each variable and its
FIGURE 2
An Advanced Model of Corporate Ecological Responsiveness
ECOLOGICALLY
CONTEXTS FIRM MOTIVATIONS RESPONSIVE INITIATIVES
ECOLOGICAL CONTEXT
anticipated relationships with the motivations that

are happened daily at gas stations did not engage
described in detail below, and they are summarized
the same degree of public attention.
as propositions to help guide future work. Data from documents and interviews showed
that issue salience was reflected in the following
adjectives: "proven," "standardized," "quantifi-
Issue Salience able," "tangible," "easily costed," "measurable,"
and "based on sound science." Issues with low
We define issue salience as the extent to which a
salience were referred to as "soft" and "indetermi-
specific ecological issue has meaning for organiza- nate." For issues of low salience, respondents had
tional constituents. Certainty, transparency, and
relatively little knowledge, and they often said that
emotivity determine an issue's salience. Certainty the science around the issue made the decision
is the degree to which the impact of the issue on the
regarding its handling difficult. Issues of high sa-
natural environment can be measured. For exam-
lience elicited ecological responses usually moti-
ple, the disposal of nontoxic waste was quite cer-
vated by legitimation or competitiveness. A firm's
tain because respondents had good understanding
legitimacy could be threatened by the issue's sa-
of the ecological impacts of such disposal (for in-
lience because constituents could easily see the
stance, aesthetic degradation and potential leach-
impact of the firm's activities on the environment.
ing of toxins into water supplies). Global warming,
on the other hand, was far less certain because its For example, food retailers in Britain were con-
ecological impacts were harder to determine (Oil & cerned about the use of recyclable shopping bags,
Gas Journal, 1997; Parsons & Singer, 1995). Trans- stray shopping carts, and recycling bins in the park-
parent issues are those that are easily attributable to ing lots because of the salience of these issues.
a polluting firm. Whereas a culprit making noise Similarly, several heavy polluters, such as oil com-
was often transparent, an emitter of volatile organic panies and steel companies, indicated that they
compounds was often not. Emotive issues are those had carefully landscaped their sites in order to
that elicit an emotional response from organiza- deflect negative public attention.
tional constituents. Almost all ecological issues are Respondents indicated that salient issues were
somewhat emotive, but they vary in their degree of also viewed as having a potentially significant im-
emotivity. For example, oil and chemical spills pact on firm profitability because government agen-
grabbed significant public interest when pictures of cies were more likely to impose fines or penalties
ducks bathed in oil and fish floating ashore ap- on activities, and customers were more likely to be
peared in the media, yet the frequent minor spills aware of negative ecological effects and less sup-
portive of firm activities. If issues were not salient, about "best practices," lobbying government to ad-
organizational constituents were less likely to im- just legislation and regulations, and collectively
pose pressures. Although firms were given greater managing an industry's image.
flexibility in responding to issues that were not Respondents from firms that were connected
salient, the potential cost savings or revenues closely to their competitors through these types of
earned were not as high as when the issue was field cohesion arrangements made comments such
salient. Salient issues were more highly valued by as "We all live in glass houses," "The tendency for
consumers, and input costs were lower because the industry is to keep that in the family and not
they did not reflect ecological impacts. Competitive make an issue of it," "We all suffered from Exxon's
advantage was not likely to be realized when issue big mistake," "We have to work with the peer
salience was low unless a firm was able to make the group," "We can't afford to get out in front and lose
issue salient to its suppliers or customers. Thus, the support of others," "The networks are tightly
issue salience also resulted in initiatives motivated knit ... we rely on each other for the supply of
by competitiveness. These relationships can be ex- products, distribution ... if we go out on our own
pressed in the following proposition: we could be put in a blackmail situation," and
"Some of these issues are better tackled by the
Proposition 1. Issue salience will be positively industry as a whole." Institutional pressures from
associated with legitimation and competitive- industry peers made it difficult to deviate from the
ness.
norm. Industry members had difficulty innovating
products and processes because these innovations
ratcheted up the standards for others. Conse-
Field Cohesion
quently, these firms mimicked the initiatives of
We define field cohesion as the intensity and their peers. These firms were motivated strongly by
density of formal and informal network ties be- concerns of legitimacy.
tween constituents in an organizational field. An The data revealed that field cohesion influenced
organizational field consists of "those organiza- firms' motivations. The connectedness of employ-
tions that, in the aggregate, constitute a recognized ees, owners, and local residents increased the fre-
area of institutional life: key suppliers, resources quency and intensity of interactions, placing the
and product customers, regulatory agencies, and firms operating within that field under greater scru-
other organizations that produce similar services or tiny and resulting in concerns about their legiti-
products" (DiMaggio & Powell, 1991: 64-65). macy. Respondents commented on the need to
Fields are built around a network of interorganiza- have a "good neighbor policy." An interviewee
tional relationships. The intensity of the relation-from a cooperative indicated this: "We have con-
ships is facilitated by proximity, both social and sumers locally owning us and being very much
geographic, and through the interconnectedness of involved. The local ownership and control gets
constituents in the field (Oliver, 1991). The data messages coming up from the grassroots." An oil
indicated that the frequency of interactions and company manager indicated, "The closer you get to
resource dependencies increased interconnected- the market place, the more you must be careful
ness within the field, as organizational members about what you disclose." A respondent from an
transferred their understanding of the organiza- auto manufacturer said that the firm adopted an
tional environment, including the natural environ- emissions control system because "the public is
ment, to each other. Proximity further facilitated close to the factory which would be affected by our
these transfers. As DiMaggio and Powell (1983) pre- emissions so that concerns us." Continuing, he
dicted, shared understandings resulted in the mim- said, "If we have harmful emissions, people will
icking of each other's actions. publicize it and it will be a problem just like if there
Negative images of the industry's ecological im- is a spillage." Japanese companies, in particular,
pacts and the activities of industry associations emphasized the importance of cohesion in influ-
helped develop field cohesion (Goes & Park, 1997; encing their operations, as reflected in this com-
Pennings & Harianto, 1992). Fields labeled as ment: "Japan is more homogenous. People act in
"dirty," such as the oil, chemicals, mining, and the same direction in a concerted way. Local guid-
forestry industries, were under intense scrutiny. Asance is with local agreement with industry and the
a result, field members colluded either through for-community."
mal arrangements, such as industry associations, or Firms in fields with high cohesion were less
through informally monitoring each other's ecolog-likely to be motivated by competitiveness. Given
ical responses. Industry associations further pro-the heavy overt and covert pressures to conform
moted field cohesion by transferring information within cohesive fields, it became difficult for firms
to be unique. Competitive moves were often repli-& Bateman, 1998; Dutton & Ashford, 1993; Stead &
cated within the field. Innovations diffused among Stead, 1992).
firms rapidly, eliminating potential benefits associ- Individual concern for the environment on the
ated with them. Firms exceeding industry expecta- parts of organizational members or owners led to
tions were persecuted by industry peers. the motivation of ecological responsibility. For ex-
Firms were less likely to be motivated by pursu- ample, one food retailer in this study was engaged
ing higher levels of ecological responsibility in a in life cycle analysis of own-brand goods, although
cohesive field. Field cohesion implied that firms rewards to the firm's legitimacy or competitiveness
shared the same understanding of acceptable orga- were not expected. When asked why they engaged
nizational practices. Superior performance was dis- in this costly analysis, the environmental director
couraged because it made other field members responded as follows: "Our chairman was very ad-
"look bad," and it ratcheted up standards for other amant that we were going to become much more
field members, raising operating costs. Managers ecologically aware. He said 'We ought to be more
had less discretion, given the pressures to conform green because we want to do good."' Socially re-
to standard industry practice or prescriptions im- sponsible actions reflect permanent and omnipres-
posed by the local community. Further, organiza- ent concerns and must be judged by individuals
tional members were more aware of socially re- (Miles, 1987). Individual concern also led to a le-
sponsible practices, given that the appropriate gitimation motivation if the concerns of the indi-
actions were well defined. Hence, exemplary prac- vidual were congruent with those of constituents
tices required by ecological responsibility were not within society. These relationships lead to the final
likely considered. These relationships are ex- proposition:
pressed in Proposition 2:
Proposition 3. Individual concern will be pos-
Proposition 2. Field cohesion will be positively itively associated with ecological responsibility
associated with legitimation and negatively as- and legitimation.
sociated with competitiveness and ecological
responsibility. IMPLICATIONS AND CONCLUSION
Profiles for Ecological Responsiveness

Individual Concern
The purpose of this study was to understand why
Individual concern for the natural environment firms are ecologically responsive by identifying
is the degree to which organizational members firm motivations and their contexts. Although our
value the environment and the degree of discretion intention was not to evaluate corporations' ecolog-
they possess to act on their environmental values. ical responsiveness, the study provided an oppor-
Firms are comprised of individuals who have tunity to suggest conditions that may lead to un-
"bounded rationality," cognitive biases, and per- usually high responsiveness. This extension of the
sonal values that direct their actions (Cyert & model, which is not part of the empirical process, is
March, 1963; Hambrick & Mason, 1984; March & based on two assumptions. First, motivations can
Simon, 1958). Values are enduring, emotionally be mixed. In developing our model of corporate
charged abstractions that are important to individ- ecological responsiveness, we wished to distin-
uals (Rokeach, 1973). Personal values can influence guish between alternate motivations, and we there-
a firm's ecological responses in three important fore focused on firms with dominant motivations.
ways. First, organizations are bombarded with nu- But a number of firms were characterized by mixed
merous signals, only some of which are relevant to motivations. Thus, as we considered the normative
them (Daft & Weick, 1984). Values help decision implications of the model, we assumed that both
makers to discriminate between those that are im- dominant and mixed motivations were viable and
portant and those that are not (Dutton, 1997; Ferrell might lead to high responsiveness. Second, we as-
& Gresham, 1985; Meyer, 1982). Second, environ- sumed that the notion of equifinality could be ap-
mental values will induce some organizational plied to the ecological setting. Katz and Kahn sug-
members to champion ecological responses gested that "a system can reach the same final state
(Andersson & Bateman, 1998; Hage & Dewar, 1973; [for instance, the same level of organizational effec-
Lawrence & Morell, 1995). Third, a firm's top man- tiveness] from differing initial conditions and by a
agement team and other powerful organizational variety of paths" (1978: 30). In essence, a "feasible
members are more receptive to changes in the or- set of equally effective, internally consistent pat-
ganizational agenda, products, and processes if terns" (Van de Ven & Drazin, 1985: 335) or equifi-
these fit with their own personal values (Andersson nality (Gresov & Drazin, 1997) may exist. Thus,
rather than specifying a single best ecological re- the initiatives, nor are they inclined to mimic the
sponse, or the optimal response for a given context, firm, given the institutional context. The firm can
we attempted to identify consistent configurational then develop a strategic niche in which it distin-
patterns. guishes itself as a green alternative. This combined
In discussing equifinality, Gresov and Drazin interest in competitiveness and ecological respon-
(1997) suggested four distinct types. Drawing on sibility often leads to innovations that would not
their classifications, we assumed that ecological otherwise be realized. Innovations result in more
responsiveness exemplifies configurational equifi- ecologically benign products or processes for
nality. This condition is characterized by incom- which there are efficiency or marketing gains, or
patible functional demands on an organization and products or processes that are superior in other
an unconstrained range of responses. Applied to ways. For example, a Japanese oil company devel-
this study, these conditions imply that a corpora- oped the technology to remove benzene from gaso-
tion's ecological agenda often competes with other line, resulting in an ecologically friendlier formu-
functional agendas for resources. Further, the mul- lation of gasoline and the opportunity to use the
tiple contextual conditions and motivations permit benzene for other purposes.
a wide range of possible initiatives or organiza- In the concerned profile, the interaction of field
tional responses. We expect, therefore, that multi- cohesion and issue salience induces a more intense
ple configurational profiles may lead to ecological legitimation motivation. In this profile, the field is
responsiveness. More specifically, we posit three cohesive and, as ecological concerns are recog-
profiles that lead to high responsiveness because of nized, all field members respond. This occurs be-
the coherence or consistency of the pattern: the cause of potentially delegitimizing effects associ-
caring profile, the competitive profile, and the con- ated with the firms' products and/or processes. All
cerned profile. members within the field respond aggressively and
In the caring profile, the influence of individual collectively by sharing information and innovating
concern on ecological responsibility is moderated processes. Issue salience magnifies the effect of
by issue salience. Whenever concerns for the natu- field cohesion as field members are drawn together
ral environment are based on a compelling social to protect the legitimacy of an industry. In essence,
belief that is embodied in a charismatic and pow- the field must be responsive to ensure survival of
erful manager, a firm will be ecologically respon- its members. This profile is illustrated through the
sive. The impact of individual concern is strength- reactions of chemical and forestry companies. The
ened as issue salience increases, however, resulting saliency of the ecological issues within those in-
in enhanced ecological responsiveness. The ability dustries is instrumental in precipitating the actions
of an individual to influence organizational change of the respective industry associations, which ulti-
is heightened as ecological responsiveness is rec- mately leads to an industrywide response. If firms
ognized as valid. In essence, issue salience pro- within those industries fail to respond, the profits
vides a legitimizing context for the individual's of all industry members and the livelihood of some
introduction of change. Because the change re- specific companies could be threatened.
mains largely a championing effort, the individual The manager who wants to achieve any one of
can imprint the endeavors with his or her values the configurational profiles can either select the
and direct the firm toward ecological responsive- appropriate contexts or change the existing con-
ness. For example, individuals were observed tak- texts (Drazin & Van de Ven, 1985). Selecting the
ing a particularly salient issue, such as the use of appropriate contexts assumes that the manager re-
recycled paper or the removal of halons from fire sponds only to salient issues, chooses to operate
extinguishers, and inducing a response in spite of within cohesive fields, and hires managers who
the added costs of responding to the issue. exhibit ecological concern. Alternatively, the man-
In the competitive profile, the interaction be- ager can magnify the influence of the existing con-
tween individual concern and low field cohesion texts. For example, training staff about the ecolog-
promotes a mixed motive of ecological responsibil-ical effects of organizational activities can heighten
ity and competitiveness, and this mixed motive individual concern. Improved research into the
results in potentially high responsiveness. As indi- ecological impacts of issues, such as the effects on
vidual concerns are translated into initiatives mo- human and plant life of global warming, will in-
tivated by ecological responsibility, a firm is addi- crease issue salience. Field cohesion may be in-
tionally motivated by competitive advantage. creased through more active involvement by indus-
When field cohesion is low, competitors do not try associations to encourage collaborative research
recognize the firm's ecological responsiveness as a efforts and voluntary disclosure of ecological im-
competitive threat. Competitors do not respond to pacts.
Contributions to Research in Organizations and cal, interorganizational, and individual levels of

the Natural Environment analysis.
Our model points not only to the importance of
Gladwin (1993) and Shrivastava (1994) issued
integrating different levels of analysis but also to
pleas for the greening of organizational studies. the importance of integrating theoretical perspec-
This study furthers that goal by connecting the tives. To fully understand corporate ecological re-
domains and discourses of organizational theorists sponsiveness, the application of ideas rooted in
with those of researchers examining organizations institutional theory, economic theory, and individ-
and the natural environment (ONE). In particular, ual values is required. Although each of the moti-
our study speaks indirectly to the tension between vations is described by their distinctiveness, their
ecocentric and anthropocentric approaches to orga- power to affect corporate ecological responsiveness
nizational studies, which is a critical dialogue in is strengthened through their interactions. Re-
research on organizations and the natural environ- search in organizations and the natural environ-
ment. Anthropocentrism, the dominant paradigm, ment requires multidisciplinary analysis. As our
is marked by the centrality of human interests research shows, applying only a single paradigm to
(Gladwin, Kennelly, & Krause, 1995; Purser, Park, & corporate ecological responsiveness paints an in-
Montuori, 1995; Shrivastava, 1994). The natural complete picture. Applications of organization the-
environment is used, abused, nurtured, and devel- ory within work on organizations and natural en-
oped only if it supports those interests. vironment necessitate and facilitate the bridging of
Within ecocentrism, nature has centrality, and all theories that are often treated independently.
biophysical systems, including humans, are inte-
grated parts of nature (Gladwin et al., 1995; Purser et Limitations and Future Directions
al., 1995; Shrivastava, 1994). Human actions can be
evaluated only in relation to the natural environment. The limitations of this research provide anchors
The motivations for ecological responsiveness exhibit for future research. First, this research was induc-
elements of these perspectives. Organizational self- tive in design. Our goal was to build substantive
interest fuels competitiveness and legitimation. Eco- generalizable theory in an underresearched area.
logical responsiveness is fragmented, so that each The strength of this design is that it exposes new
environmental issue is evaluated incrementally and insights and new relationships. The weakness is
often independently of each other issue. A firm mo-
that it does not permit a researcher to make valid
speculations about the relative efficacy of the mo-
tivated by ecological responsibility, in contrast, fos-
tivations. The data here indicated that firms were
ters a more holistic approach to ecological respon-
motivated largely by concerns for legitimacy, less
siveness. Organizations evaluate their long-term
by competitiveness, and even less by ecological
relationships with the natural environment, not to
responsibility. However, these findings could not
promote organizational interests, but to promote so-
be tested because the constructs and their relation-
cial interest. Although this shift in focus does not
ships were induced from this data set. Future re-
fully exemplify an ecocentric perspective, the seeds
search could test the efficacy and prevalence of
of ecocentric values are at least planted. Although our these contexts and motivations and their relation-
data show that few firms are motivated by ecological
ship to ecological responsiveness.
responsibility, its presence suggests that ecocentric Second, this research is generalizable only to the
discourse grounded in research on organizations and extent that the theoretical dimensions are captured
the natural environment is relevant to management in this study. Although we controlled for some
audiences.
industry, country, and company effects, we did not
Our model also highlights the importance of dif- include firms in environmental industries, such as
ferent levels of analysis in shaping organizationalwind or photovoltaic energy producers. We also
responses. Starik and Rands (1995) suggested thatlimited our study primarily to two countries, the
different levels of analysis are required to assess theUnited Kingdom and Japan, because of our interest
potential for an organization to be ecologically sus- in investigating specific concerns pertaining to the
tainable. In particular, they suggested that organi- context, such as field cohesion, issue salience, and
zations have relationships with individuals, otherindividual concern. However, the United Kingdom
organizations, political-economic entities, socio- and Japan are very different across other cultural
cultural entities, and with nature. Identifying and dimensions that were not investigated in this re-
managing these interfaces is critical to achievingsearch. For example, Hofstede (1980) found that the
sustainability. Our results show that a firm's re- United Kingdom was considerably more individu-
sponsiveness is directly related to the ecologi- alistic, had lower uncertainty avoidance, had lower
"power distance," and was less masculine than Ja- natural environmental issues in business organi-
pan. We did not explore the interactions of these zations. Working paper, Saint Joseph's University,
cultural dimensions with the motivations of corpo- Philadelphia.
rate environmental responses, but they could be Berry, M. A., & Rondinelli, D. A. 1998. Proactive corpo-
instrumental in furthering the richness of our pro- rate environmental management: A new industrial
posed model. Furthermore, if we had chosen other revolution. Academy of Management Executive,
cultural contexts, such as those of Brazil or Indo- 12(2): 1-13.
nesia, richer insights might have been generated. Bonifant, B. C., Arnold, M. B., & Long, F. J. 1995. Gaining
We also did not investigate effects of differences in competitive advantage through environmental in-
the institutional ownership of corporations on cor- vestments. Business Horizons, 38(4): 37-47.
porate ecological responsiveness, which is particu- Buchholz, R. A. 1991. Corporate responsibility and the
larly salient to research involving Japanese firms. It good society: From economics to ecology; factors
is also possible that our reliance on supplemental which influence corporate policy decisions. Busi-
interviews inappropriately heightened the impor- ness Horizons, 34(4): 1-19.
tance of the role of institutional organizations. Fu- Buchholz, R. A. 1993. Principles of environmental man-
ture research could test whether other dimensions agement: The greening of business. Englewood
of the contexts we uncovered are relevant to this Cliffs, NJ: Prentice-Hall.
framework.
Cordano, M. 1993. Making the natural connection: Justi-
Third, in this research we attempted to uncover a fying investment in environmental innovation. Pro-
firm's motivations after the firm had made its de- ceedings of the International Association for Busi-
cision to act. In spite of our efforts to validate the ness and Society: 530-537.
accounts offered by participants, this research is
Cyert, R. M., & March, J. G. 1963. A behavioral theory of
subject to the biases associated with accounts that the firm. Englewood Cliffs, NJ: Prentice-Hall.
acquire greater efficacy over time (Van de Ven,
Daft, R. L., & Weick, K. E. 1984. Toward a model of
1988). However, if we had researched firm motiva-
organizations as interpretation systems. Academy of
tions while decisions were being made, we would Management Review, 9: 284-295.
have had to reduce the number of case studies and
Denzin, N. K. 1989. The research act: A theoretical
thereby compromise data validity and reliability.
introduction to sociological methods. Englewood
At the outset of this project, we decided that a more
Cliffs, NJ: Prentice-Hall.
robust theory could be developed by using the
Dillon, P. W., & Fischer, K. 1992. Environmental man-
methodology employed here, rather than conduct-
agement in corporations. Medford, MA: Tufts Uni-
ing a study during decision making. It would be
versity Center for Environmental Management.
useful for future research to apply the model devel-
oped here to decisions as they are being made, in DiMaggio, P. J., & Powell, W. W. 1983. The iron cage
order to assess the model's predictability. revisited: Institutional isomorphism and collective
rationality in organizational fields. American Socio-
This research is an attempt to advance under-
logical Review, 48: 147-160.
standing of why firms are ecologically responsive.
A rich model of corporate ecological responsive- Drazin, R., & Van de Ven, A. H. 1985. Alternative forms of
ness requires consideration of the underlying mo- fit in contingency theory. Administrative Science
Quarterly, 30: 514-539.
tivations. In this project, we attempted to inform
the literature on organizations and the natural en- Dutton, J. E. 1997. Strategic agenda building in organiza-
vironment by developing theory that helps to ex- tions. In Z. Shapira (Ed.), Organizational decision
plain and predict corporate ecological responsive- making: 81-105. Cambridge, MA: Harvard Univer-
ness.
sity Press.
Dutton, J. E., & Ashford, S. J. 1993. Selling issues to top

management. Academy of Management Review,
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Taylor Fellow at the Richard Ivey School of Business,
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University of Western Ontario. She received her D.Phil.
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in management studies from the University of Oxford.
management of strategic change: 330-341. Oxford:
Basil Blackwell. Her research primarily investigates issues of the natural
environment through strategic and institutional lenses.
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ership in three contexts: Managing for global com- Kendall Roth is the J. Willis Cantey Chair of International
petitiveness. Proceedings of the International As- Business and Economics at the Darla Moore School of
sociation of Business and Society: 495-500. Business, University of South Carolina. He received his
Winn, M. 1995. Corporate leadership and policies for the Ph.D. in business administration from the University of
natural environment. In D. Collins & M. Starik (Eds.), South Carolina. His current research interests focus on
Research in corporate social performance and international strategy implementation, competition in in-
policy, supplement 1: 127-161. Greenwich, CT: JAI ternational industries, and top management decision
Press. making.

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Why Companies Go Green: A Model of Ecological Responsiveness

Author(s): Pratima Bansal and Kendall Roth

WHY COMPANIES GO GREEN:

footprint" (Hart, 1997). Prior literature on organiza-

Leadership *> Ethical motives

zational motives actually explained corporate to be representative of a population, in theoretical

Food retailers Nippon Steel 2

Marks & Spencer plc 1 Total number of interviews with Japanese 28

Wm. Low & Co. plc 2 Single case studies

P&O Group 1 Total number of interviews with single case 12

Princess Cruises 1 a Indicates a supplementary interview.

Total number of interviews with P&O 14

companies place chlorofluorocarbons (CFCs) in its refrigerants

Gulf Oil (UK) Ltd. 1 resentatives of relevant Japanese institutions, in-

Environment (JACO)a Identifying motivations and their key differen-

Nippon Oil Corporation 4

Competitiveness It was seen as good business3 food retailers

Environment is going to be some kind of business strategy.

We will do what we need to do legally.

Social 3 food retailers

Ends Profitability Firm survival Corporate morale

Means Competitive advantage Compliance with norms and Social good

Constituent focus Customers, investors Government, local community, Society

Decision rule Maximize Satisfice Idealize

Strategic posture Innovative Isomorphic/imitative Independent

it discovered another use for the benzene. Several Legitimation

Motivation Ecologically Responsive Initiatives Anticipated Benefits

anticipated relationships with the motivations that

Profiles for Ecological Responsiveness

Contributions to Research in Organizations and cal, interorganizational, and individual levels of

Dutton, J. E., & Ashford, S. J. 1993. Selling issues to top

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