Corporate environmental strategy, environmental performance, and financial performance in the U.S.A. heavy polluting industries, 1991-2005

Abstract

This is a longitudinal study using KLD, EPA TRI and Compustat data to address several questions about the relationships between corporate environmental strategy, financial performance, and environmental performance in a sample of companies operating in the so-called "dirty" industries in the USA from 1991 to 2005. There have been numerous publications on sustainability over the last 35 years, but there is a dearth of research providing evidence in support of the theories and views advanced. The literature has focused on two issues: the relationship between corporate environmental strategy (ES) and environmental performance (EP) and the relationship between environmental performance and financial performance (FP). The preliminary research described in Chapter 2 of this dissertation explores several fundamental research questions. Building on this exploratory work are three chapters, each being a more tightly focused and rigorous study of several quite specific research questions: Chapter 3 deals with caveats for researchers using KLD data; Chapter 4 explores the relationship between corporate ES and EP in light of advances made in Chapter 3; and Chapter 5 deals with heterogeneity in the ES-EP-FP-Slack system. Chapter 6 summarizes the findings of both the preliminary and principal research and outlines future research possibilities.