Abstract
Increasingly, companies are considering environmental differentiation as a basis for their competitive strategy. As they formulate and implement their strategy, these companies must decide upon an appropriate device to signal a superior environmental performance to consumers and other stakeholders. This article examines three of these devices: Corporate environmental reports (CER), eco-labeling programs, and the ISO 14001 environmental management systems (EMS) standard. Specific challenges and limits associated with their use are discussed and insight into ways to overcome potential barriers are offered. One of these challenges relates to skepticisms, whereas another resides with the risk of imitation from competitors. Hence, companies must both build trusting relationships, and continuously maintain and develop resources and competencies that will enable them to sustain their competitive advantage over competitors.
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