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BUSINESS & MANAGEMENT STUDIES:
AN INTERNATIONAL JOURNAL
Published: 2020-09-25

A RESEARCH ON THE RELATIONSHIP BETWEEN ENVIRONMENTAL MANAGEMENT APPLICATIONS AND ORGANIZATIONAL PERFORMANCE: THE EFFECT OF ENVIRONMENTAL PROACTIVITY

Asisst. Prof., Brunel Üniversity
Asisst. Prof., Bahçeşehir University
Environmental Management Practices Organizational Performance Dynamic Capabilities View Environmental Proactivity

Abstract

1. LITERATURE
Over the past two decades, environmental management (EM) systems have been increasingly implemented throughout the world, not only by large-scale firms but also by many small- and medium-sized enterprises (SMEs) (Lopez-Gamero et al., 2009; Tatoglu et al., 2015). Industrial developments have brought many innovations in production methods and processes while creating huge burdens. Water and air pollution, global warming, soil erosion, ozone depletion, and declines in forested and agricultural lands constitute some of the critical challenges widely faced as environmental issues. These challenges appear to necessitate modifications in the external settings of the structures of the industries. Pressure from controlling forces and environmental sensitivity on the part of the public, in particular, have the potential to affect business-related activities. Increasing environmental consciousness in society is one of the key reasons behind this growth. Increasing governmental regulations and requirements, pressure from nongovernmental organizations (NGOs) and other organized groups, and customers’ preference for firms that use environmentally friendly production methods tend to force both manufacturing and service firms to take action in this direction. When customers pay attention to selecting the products of firms that are sensitive to environmental issues (Ginsberg and Bloom 2004; Jabbour and Santos, 2006), firms tend to be careful about their decisions on supplier selection and place a great emphasis on their environmental management practices (EMP).
1.1. RESEARCH SUBJECT
This study examines whether the environmental management practices of companies operating in Turkey have a positive impact on company performance. Accordingly, the impact of environmental management practices on environmental proactivity as well as the mediating role of environmental proactivity in the relationship between environmental management practices and organizational performance was explored.
1.2. RESEARCH PURPOSE AND IMPORTANCE
Although the contributions of EMP in improving both firm performance and their differentiation based on competitive advantage have been well acknowledged in practice, there is an ongoing interest in the relation between EMP and organizational performance. Drawing on the arguments of the dynamic capabilities view, this study proposes a research model that examines the effects of the adoption of environmental management practices on environmental proactivity and the mediating role that environmental proactivity plays in the relationship between the adoption of environmental management practices and organizational performance.

1.3. CONTRIBUTION of the ARTICLE to the LITERATURE
The fundamental theoretical contribution of the research is the incorporation of EMP, and eventually EP, as firm capabilities as a way to gain competitive advantage, in line with the arguments of the dynamic capabilities view. Insights derived from this study contribute to connecting the gap between theory and practice, specifically concerning strategic management and the adoption of environmental management practices.
2. DESIGN AND METHOD
2.1. RESEARCH TYPE
The quantitative research design was adopted in this study. Accordingly, a survey is designed to understand the implementation level of EMP and its effect on organizational performance, drawing on a sample of Turkish firms.
2.2. RESEARCH PROBLEMS
In this study, the authors tried to find answers for two research problems: (1) Is there any positive relation between environmental management practices organizational performance? ; (2) Does environmental proactivity mediates the relation between environmental management practices and organizational performance?
2.3. DATA COLLECTION METHOD
Cross-sectional mail survey is used to collect the data. The initial form of the survey was in English, and it was translated into Turkish. The Turkish version was back-translated until a board of experts including scholars and industry professionals, approved that the two forms were equivalent. The website of ICI (Istanbul Chamber of Industry, http://www.iso.org.tr) constituted the sampling frame for Turkish firms. ICI provides an industrial database that contains nearly 18,000 firms functioning in a wide variety of manufacturing industries. Through a random sampling technique, 1,000 firms were selected and established the sampling frame for the survey. A survey and a cover letter were mailed to the CEO of each member company, requesting completion by the CEO or a senior manager with knowledge of environmental issues and organizational performance. After two reminders, a total of 208 usable surveys were received and this represents an effective response rate of 20.8 per cent, which was seemingly adequate, given the confidentiality of the questionnaire.
3. FINDINGS AND DISCUSSIONS
The findings demonstrate that although the link between the adoption of environmental management practices and organizational performance is insignificant within direct links, in the presence of higher environmental proactivity, the effect of the adoption of environmental management practices on organizational performance becomes significant and positive. This finding resolves the controversies about the relationship between environmental management practices and organizational performance by merely noting that applying or adopting environmental management practices is not a sufficient condition to achieve higher organizational performance. Instead, firms need to realize their actions and pursue environmental proactivity indicators in order to attain higher organizational performance.
4. CONCLUSION, RECOMMENDATION AND LIMITATIONS
4.1. RESULTS of the ARTICLE
The results show that when there is a high level of environmental proactivity, the impact of adopting environmental management practices on organizational performance is significant and positive. This indicates that the adoption of environmental management practices is not a sufficient condition for achieving higher organizational performance. As a result, the findings of this study suggest evaluating discussions about the relationship between environmental management practices and organizational performance in this context.
4.2. SUGGESTIONS BASED on RESULTS
The knowledge gained from this study may contribute to bridging the gap between theory and practice, especially regarding the adoption of Strategic Management and environmental management practices. At the same time, research can be designed that covers the extent to which the sub-dimensions of environmental management practices are effective in achieving organizational performance. It will be useful for these studies to reveal reviews based on sectors and geographies. Another area of study may be on the impact of environmental management practices on multinational companies’ investment decisions. All of these are important issues to highlight the fact that environmental management practices have become a capability in the core strategies of companies.
4.3. LIMITATIONS of the ARTICLE
Despite its merits, this study is subject to some limitations. These limitations are primarily those associated with the research methods adopted and the single-country context selected. Initially, the selection of Turkey as the context for the study had some advantages and disadvantages. Because the study involves a single-country context, understanding the nature of a market in depth makes a more specific contribution.

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How to Cite

AYAZ ARDA, Özlem, & ASLAN, T. (2020). A RESEARCH ON THE RELATIONSHIP BETWEEN ENVIRONMENTAL MANAGEMENT APPLICATIONS AND ORGANIZATIONAL PERFORMANCE: THE EFFECT OF ENVIRONMENTAL PROACTIVITY. Business & Management Studies: An International Journal, 8(3), 3582-3614. https://doi.org/10.15295/bmij.v8i3.1516