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The Relationship between Corporate Environmental Performance and Corporate Financial Performance in Green Road Transportation

Wylenzek, Benjamin LU and Claussen, Sven LU (2017) BUSN09 20171
Department of Business Administration
Abstract
In times of climate change, companies face extreme pressure from external stakeholders to engage in environmental sustainability activities. Especially companies of industries that significantly contribute to the global carbon emissions are expected to change their behaviour. There, the road freight transportation business is known for its particularly heavy impact. Being forced to adapt to change, logistics providers are searching for ways to combine environmental sustainability with positive corporate financial performance. This relationship is subject to a great confusion within literature, since theorists differ in opinion. Therefore, this study aims at identifying how this controversial relationship is actually perceived by the... (More)
In times of climate change, companies face extreme pressure from external stakeholders to engage in environmental sustainability activities. Especially companies of industries that significantly contribute to the global carbon emissions are expected to change their behaviour. There, the road freight transportation business is known for its particularly heavy impact. Being forced to adapt to change, logistics providers are searching for ways to combine environmental sustainability with positive corporate financial performance. This relationship is subject to a great confusion within literature, since theorists differ in opinion. Therefore, this study aims at identifying how this controversial relationship is actually perceived by the affected logistics providers in order to extend the existing knowledge around this topic. By means of semi-structured interviews with various environmental experts of different logistics providers, perceptions based on experiences and presumptions are collected in order to recognise patterns in the decision making processes and to conduct a comparative analysis that differs from the predominantly quantitative studies that have investigated the relationship so far. Affected by a period of transition, it has been observed that companies face great uncertainties with regards to future developments. Not knowing how major environmental challenges will be solved, logistics providers identify various factors that potentially impact the relationship positively or negatively. Costs for environmental friendly technologies can outbalance or remain below the cost savings achieved through, for instance, better fuel consumption due to the unknown future value. Unforeseeable governmental regulations and customer demands heavily contribute to this uncertainty. Transportation optimisation techniques such loading efficiency are also considered to possibly lead to both financial outcomes due to their firm specific applicability. In addition, the decision making processes for investments are influenced by corporate governance instruments as well as by culturaland educational backgrounds. Although the relationship is perceived as difficult to measure, companies show decisiveness for implementation and ultimately see a positive financial outcome, especially when a long-term perspective is applied. (Less)
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author
Wylenzek, Benjamin LU and Claussen, Sven LU
supervisor
organization
course
BUSN09 20171
year
type
H1 - Master's Degree (One Year)
subject
keywords
Environmental sustainability, Logistics, Green road transportation, Corporate environmental performance, Corporate financial performance
language
English
id
8920758
date added to LUP
2017-07-03 15:41:55
date last changed
2017-07-03 15:41:55
@misc{8920758,
  abstract     = {In times of climate change, companies face extreme pressure from external stakeholders to engage in environmental sustainability activities. Especially companies of industries that significantly contribute to the global carbon emissions are expected to change their behaviour. There, the road freight transportation business is known for its particularly heavy impact. Being forced to adapt to change, logistics providers are searching for ways to combine environmental sustainability with positive corporate financial performance. This relationship is subject to a great confusion within literature, since theorists differ in opinion. Therefore, this study aims at identifying how this controversial relationship is actually perceived by the affected logistics providers in order to extend the existing knowledge around this topic. By means of semi-structured interviews with various environmental experts of different logistics providers, perceptions based on experiences and presumptions are collected in order to recognise patterns in the decision making processes and to conduct a comparative analysis that differs from the predominantly quantitative studies that have investigated the relationship so far. Affected by a period of transition, it has been observed that companies face great uncertainties with regards to future developments. Not knowing how major environmental challenges will be solved, logistics providers identify various factors that potentially impact the relationship positively or negatively. Costs for environmental friendly technologies can outbalance or remain below the cost savings achieved through, for instance, better fuel consumption due to the unknown future value. Unforeseeable governmental regulations and customer demands heavily contribute to this uncertainty. Transportation optimisation techniques such loading efficiency are also considered to possibly lead to both financial outcomes due to their firm specific applicability. In addition, the decision making processes for investments are influenced by corporate governance instruments as well as by culturaland educational backgrounds. Although the relationship is perceived as difficult to measure, companies show decisiveness for implementation and ultimately see a positive financial outcome, especially when a long-term perspective is applied.},
  author       = {Wylenzek, Benjamin and Claussen, Sven},
  keyword      = {Environmental sustainability,Logistics,Green road transportation,Corporate environmental performance,Corporate financial performance},
  language     = {eng},
  note         = {Student Paper},
  title        = {The Relationship between Corporate Environmental Performance and Corporate Financial Performance in Green Road Transportation},
  year         = {2017},
}