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Journal cover: Multinational Business Review

Multinational Business Review

ISSN: 1525-383X

Online from: 2003

Subject Area: International Business

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Extending the literature on the environmental strategy of MNEs


Document Information:
Title:Extending the literature on the environmental strategy of MNEs
Author(s):Javier Aguilera-Caracuel, (Department of Management, University of Granada, Granada, Spain), Juan Alberto Aragón-Correa, (Department of Management, University of Granada, Granada, Spain), Nuria Esther Hurtado-Torres, (Department of Management, University of Granada, Granada, Spain)
Citation:Javier Aguilera-Caracuel, Juan Alberto Aragón-Correa, Nuria Esther Hurtado-Torres, (2011) "Extending the literature on the environmental strategy of MNEs", Multinational Business Review, Vol. 19 Iss: 4, pp.299 - 310
Keywords:Country-specific advantages, Environmental institutional distance between count, Firm-specific advantages, Multinational companies, Natural environment, Resource management, Slack resources, Strategic management
Article type:Research paper
DOI:10.1108/15253831111190153 (Permanent URL)
Publisher:Emerald Group Publishing Limited
Abstract:

Purpose – The purpose of this paper is to explain the different international environmental strategies that multinational enterprises (MNEs) can adopt.

Design/methodology/approach – This study updates the traditional country-specific advantages/firm-specific advantages (FSA/CSA) framework. In order to do so, the concepts of environmental institutional distance between countries and MNEs' availability of slack resources are used.

Findings – First, a low environmental institutional distance between headquarters' and subsidiaries' countries contributes to creating environmental standards within the company. Second, MNEs with high availability of slack resources are willing to standardize their environmental practices. However, those MNEs that have a high availability of slack resources but have units based in high-distance countries prefer to generate valuable and advanced environmental management practices only in specific countries. Finally, those MNEs with a low level of slack resources and with units based in low-distance countries only comply with national environmental institutional requirements, becoming isomorphic with other local firms.

Research limitations/implications – Although previous findings suggest that MNEs are increasingly standardizing their environmental practices, this generalization can be applied to those MNEs with units based in low-distance countries that have a high availability of slack resources, which lead them to create valuable non-location-bound, green, firm-specific advantages (FSAs).

Originality/value – This paper sheds light on the way in which MNEs' activities affect the natural environment. Since MNEs are key actors in terms of economic and environmental development, they can promote social and environmental values in society, and at the same time encourage other organizations and institutions to adopt a socially responsible attitude.



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