Abstract
This study aims at understanding the role of prior environmental performance (EP) on a firm's resilience against an environmental controversy. In line with the natural resource-based view, high EP firms should develop environmental skills and reputation that foster resilience when facing such adverse events. Using an international dataset of 233 environmental controversies over the 2010-2016 period, we find clear evidence that prior high EP significantly helps firms recover more quickly from the shock. In a context of increasing pressure on environmental issues, this result uncovers new benefits of EP for firms confronted with an environmental controversy.
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