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Environmental policies and firm value

Al-Najjar, Basil and Anfimiadou, A. (2012) Environmental policies and firm value. Business Strategy and the Environment 21 (1), pp. 49-59. ISSN 1099-0836.

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Many organizations are currently becoming more environmentally friendly. Eco-efficiency maximizes the effectiveness of a business operation while reducing its impact on the environment; with the necessary skills, organizations can create more value while using less input. Prior empirical studies have suggested that firms engaging in eco-efficient activities are better valued than those without such activities. Therefore, this will enhance business efficiency and excellence. This study investigates the link between eco-efficiency, as environmental policy, and firm value in the United Kingdom (UK) for the period 1999 to 2008. We generate new insights into environmental–financial performance by using different definitions of the term ‘eco-efficiency’. In the UK context our results support that eco-efficient firms have higher market values than those lacking environmental strategies. Hence, we recommend that firms become involved in environmental polices since the adoption of these polices will have a positive impact on firm value. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.

Item Type: Article
Keyword(s) / Subject(s): eco-efficiency, market value, ISO14001, UK
School or Research Centre: Birkbeck Schools and Research Centres > School of Business, Economics & Informatics > Management
Depositing User: Dr Basil Al-Najjar
Date Deposited: 25 Oct 2012 16:08
Last Modified: 17 Apr 2013 12:25

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