Abstract
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.
Original language | English |
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Pages (from-to) | 49-59 |
Number of pages | 11 |
Journal | Business Strategy and the Environment |
Volume | 21 |
Issue number | 1 |
Early online date | 27 Apr 2011 |
DOIs | |
Publication status | Published - 1 Jan 2012 |
Externally published | Yes |
Keywords
- Eco-efficiency
- ISO14001
- Market value
- UK