When Does it Pay to be Green?

Abstract

Progressive corporations have invested in increasingly ambitious sustainability initiatives. While environmental investments are welcome by society, managers need to identify the circumstances favoring the generation of both public benefits and corporate profits. For some firms, better utilization of resources may pay-off as environment- related investments. For others, obtaining ISO 14001 certification or having some eco-labeled products can eventually be the best way of pursuing competi- tive advantage. This article presents a framework for categorizing generic types of competitive environmental strategies, a classification scheme that can help managers optimize the economic return on environmental investments and transform these investments into sources of competitive advantage.