Analyzing the effect of corporate environmental performance on corporate financial performance in developed and developing countries

Sergio Manrique, Carmen Pilar Martí-Ballester*

*Corresponding author for this work

Research output: Contribution to journalArticleResearchpeer-review

41 Citations (Scopus)

Abstract

© 2017 by the authors. Licensee MDPI, Basel, Switzerland. The relationship between corporate environmental performance and corporate financial performance has been extensively studied in developed countries, and has received less attention in developing countries. For this reason, the main objective of this paper is to examine the effect of corporate environmental performance on corporate financial performance during a global financial crisis, depending on the economic development level of the country where a firm is located. To this end, we obtain data for a sample of 2982 large firms from 2008 to 2015. We apply Petersen's approach to these data, adjusting the standard errors for clustering by both firm and year. The results obtained show that the adoption of environmental practices significantly and positively affects the corporate financial performance in developed and developing countries. However, this effect is stronger for firms located in developing countries than those located in developed countries.
Original languageEnglish
Article number1957
JournalSustainability
Volume9
Issue number11
DOIs
Publication statusPublished - 27 Oct 2017

Keywords

  • Corporate environmental performance
  • Corporate financial performance
  • Developed countries
  • Developing countries
  • Panel data

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