Grantee Research Project Results
2006 Progress Report: Oregon Business Decisions for Environmental Performance
EPA Grant Number: R831034Title: Oregon Business Decisions for Environmental Performance
Investigators: Ervin, David E. , Khanna, Madhu , Speir, Cameron , Jones, Cody , Wu, Junjie , Koss, Patricia , Hall, Terry
Current Investigators: Ervin, David E. , Khanna, Madhu , Wu, Junjie , Koss, Patricia
Institution: Portland State University , University of Illinois Urbana-Champaign , Oregon State University
Current Institution: Portland State University , Oregon State University , University of Illinois Urbana-Champaign
EPA Project Officer: Hahn, Intaek
Project Period: June 1, 2003 through May 31, 2006 (Extended to May 31, 2007)
Project Period Covered by this Report: June 1, 2005 through May 31, 2006
Project Amount: $251,973
RFA: Corporate Environmental Behavior: Examining the Effectiveness of Government Interventions and Voluntary Initiatives (2002) RFA Text | Recipients Lists
Research Category: Environmental Justice
Objective:
The objectives are to:
(1) Collect primary data on the environmental practices of a random sample of Oregon firms.
(2) Identify and measure the major environmental performance indicators, e.g., toxic releases, water pollutant emissions, and solid waste levels, for Oregon firms.
(3) Collect data on firm, industry, regulatory, and ‘voluntary’ environmental program factors hypothesized to influence business environmental performance.
(4) Test the influences of firm, industry, and regulatory conditions, simultaneously with voluntary program factors, on the use of environmental policies and practices.
(5) Test the influences of firm, industry, and regulatory and voluntary program factors on firms’ environmental performance.
(6) Infer the ‘voluntary’ program elements (i.e., policies and practices) and other factors that significantly improve firm environmental performance.
Progress Summary:
The period from June 2005 to May 2006 was devoted primarily to refining the survey instrument, administering the survey, collecting data, cleaning data, conducting summary statistics analysis to characterize the data, identifying secondary data sources, and incorporating secondary data into the data set. Survey administration was conducted by the Social and Economic Sciences Research Center (SESRC) at Washington State University.
Survey Administration and Data Collection
SESRC mailed the survey in October 2005. Two additional mailings were conducted in November 2005 and February 2006 to encourage responses from industry sectors that showed lower response rates.
Sample and Response Rate
The survey generated a response rate of 35.1 percent, and 689 responses. Responses were received from each of the six industry sectors included in the sample. Respondents were predominantly small: 69 percent employed fewer than 50 individuals; 95 percent employed fewer than 250 individuals. Only 21 percent of the sample reported was owned by a parent firm. The sample included facilities in 33 of Oregon’s 35 counties; responses were received from 30 counties.
Survey General Findings
More than one-half of the sample stated that environmental issues were a major concern in their industry; however, the majority of facilities do not maintain dedicated environmental staff. Thirty percent of the sample reported having such staff, and only 7 percent reported that environmental decisions are primarily the responsibility of an environmental manager.
Findings on expenditures for environmental management were consistent with estimates reported by Reinhardt (2000) and others. For 2003, facilities devoted an average 2.26 percent of annual revenues to environmental management, and 2.40 percent in 2004.
Twenty percent of respondents reported participating in voluntary environmental programs (VEPs). The most popular programs, in order, were: ENERGY STAR®, the Leadership in Energy and Environmental Design (LEED®) green building program, the Earth Advantage green building program, and the Oregon Natural Step. The most popular program categories were energy conservation and efficiency, green building, and solid waste reduction/recycling.
Influences on Environmental Management
The literature has identified external and internal influences that may impact a firm’s decision to implement voluntary environmental management (Delmas and Toffel, 2004; Khanna, 2001; Reinhardt, 2000). Studies have found that, in addition to responding to regulatory requirements, firms may respond to their perceptions regarding customer desire for environmentally friendly products, investor desire for reduced risk, competitive influences, and so forth. The table shows the pressures included in this study, together with overall summary statistics.
Influences were assessed with a 5-point Likert scale ranging from 1 (low) to 5 (high). Management attitudes were measured with a 5-point scale ranging from 1 (strongly disagree) to 5 (strongly agree), with 3 indicating neither agree nor disagree. Overall summary results are shown in Table 1.
Table 1.
Pressure |
Mean |
Standard Deviation |
Customer |
2.65 |
1.38 |
Environmental Interest Group |
2.14 |
1.27 |
Investor and Lender |
2.98 |
1.45 |
Regulatory |
3.25 |
1.39 |
Competitive Influences |
2.69 |
1.36 |
Management Attitudes (agreement) |
3.70 |
1.05 |
Barriers to Environmental Management |
2.94 |
1.30 |
Environmental Practices and Performance
Facilities were asked about implementation of environmental practices such as employee training and green purchasing policies. Forty percent indicated that none of the practices had been implemented. The most common practice was environmental training (implemented by 39% of facilities responding). Because of low responses to quantitative performance variables, analysis of performance data will be conducted after secondary data are incorporated into the data set to achieve sufficient data for analysis.
Progress Status
As of the end of May 2006, the project was considered 65 percent complete, and is averaging 6 or more months behind projected progress. Progress has been affected this year by slower than expected response times to the survey mailing, the need for an additional mailing which was not anticipated, and the extent of the data cleaning process. Additionally, further changes in graduate assistant and support staff have impacted progress. Finally, low response rates to the performance variables necessitate the collection of secondary data and the development of alternative analytical techniques to capture performance indicators.
Multivariate analysis is in development and results from such analyses will be reported in future publications. Initial publications are anticipated in spring and summer 2007, with the final report anticipated to be submitted in summer 2007 per the conditions of the project grant.
References:
Alberini A, Segerson K. Assessing voluntary programs to improve environmental quality. Environmental and Resource Economics 2002;22(1-2):157-184.
Carpentier CL, Ervin DE. Business approaches to agi-environmental management: Incentives, constraints and policy issues. Presented to the: Organization for Economic Cooperation and Development, Paris, France 2002.
Delmas MA, Toffel MW. Institutional pressure and environmental management practices: an empirical analysis. Presented at the U.S. EPA Conference on Corporate Environmental Behavior and the Effectiveness of Government Interventions, Washington, DC U.S. EPA National Center for Environmental Economics and National Center for Environmental Research, Washington, DC, April 26-27, 2004.
Khanna M. Non-mandatory approaches to voluntary environmental protection. Journal of Economic Surveys 2001;15(3):291-324.
Lyon TP, Maxwell JW. Corporate environmentalism and public policy. Cambridge, UK: New York: Cambridge University Press, 2004, 308pp.
Reinhardt FL. Down to earth: applying business principles to environmental management. Boston, MA: Harvard Business School Press, 2000, 291pp.
Segerson K, Li N. Voluntary approaches to environmental protection. In: Folmer H, Tietenberg T, eds. The International (l.c.) Yearbook of Environmental and Resource Economics 1999/2000. Cheltenham, UK: Edward Edgar, 1999, pp. 273-306.
Future Activities:
A 1-year no-cost extension was requested and granted, because of longer than expected times to launch the project, hire all research assistants, draw the sample, construct the survey instruments, and collect the survey responses.
The schedule of planned activities during the next project year includes:
- Incorporation of additional secondary data into the data set (Spring 2007).
- Model development and data analysis (ongoing).
- Final report preparation summarizing key findings of initial analyses (May 2007).
Journal Articles:
No journal articles submitted with this report: View all 10 publications for this projectSupplemental Keywords:
socio-economic, public policy, Northwest, pollution prevention, corporate environmental decision making, voluntary environmental management,, RFA, ENVIRONMENTAL PROTECTION AGENCY, Economic, Social, & Behavioral Science Research Program, Scientific Discipline, Geographic Area, INDUSTRY, Reinvention, State, Small Businesses, Corporate Performance, Economics and Business, decision-making, Social Science, Economics & Decision Making, Environmental Law, Oregon, polchotomas choice selectivity model, compliance assistance, policy making, decision analysis, decision making, environmental decision making, incentives, cost benefit, economic incentives, corporate evironmental reform, cost/benefit analysis, environmental policy, compliance costs, benefits assessment, corporate environmental behaviorRelevant Websites:
http://obep.research.pdx.edu Exit
Progress and Final Reports:
Original AbstractThe perspectives, information and conclusions conveyed in research project abstracts, progress reports, final reports, journal abstracts and journal publications convey the viewpoints of the principal investigator and may not represent the views and policies of ORD and EPA. Conclusions drawn by the principal investigators have not been reviewed by the Agency.