Institutional Pressures and Organizational Characteristics: The Case of Polluting Emissions and the Toxics Release Inventory

Abstract

This article develops a model that demonstrates how organizational characteristics moderate institutional pressures on firms that report annually to the Toxics Release Inventory. In terms of institutional pressures, market forces, non-market forces and regulatory demands influence environmental practices at the plant level. Organizational characteristics of the firm, including firm size, competitive position and degree of internationalization moderate these influences, leading to a firm’s corporate environmental performance. The article finds that firms may voluntarily over-comply with the existing regulation when such action aligns with existing corporate strategies and culture, reducing the possibility of stricter regulation and enhancing a socially responsible reputation. JEL: Q52, Q58, H32, M14, M21