Do firms adopt lower standards in poorer areas? Corporate social responsibility and environmental justice in the EU and the US

Abstract

Within the context of broader debates on corporate social responsibility (CSR) and environmental justice (EJ), this paper examines three key questions: first, how the standards that corporations adopt at the global scale trickle down into local site‐level practices; second, whether levels of corporate environmental performance vary from place to place; and third whether any variations in corporate environmental performance relate to the principles of EJ. To do this, the analysis draws upon recently disclosed data to evaluate variations in the environmental performance of oil refineries across the US and the EU. It finds significant variations in emissions of some key pollutants. These exist both across the range of refineries, with dirtier refineries emitting at least five times as much as cleaner refineries, and between the EU and the US, with refineries in the EU emitting more than twice as much as refineries in the US. At the local level, it finds that there are correlations between higher levels of emissions from refineries and lower levels of income, employment and population density. Although these findings provide support for some of the contentions of the EJ movement, they do not say anything about causality, and as a result we cannot say definitively that companies adopt lower standards in poorer areas.