Outline
- Abstract
- Keywords
- 1. Introduction
- 2. the Sustainable Value Approach: A Value-Based Perspective on the Use of Environmental Resources
- 3. Identification of Value Drivers of Corporate Eco-Efficiency
- 4. Practical Application to the Car Manufacturing Sector
- 5. Discussion and Implications
- 6. Managerial Relevance
- 7. Conclusion
- Role of the Funding Source
- Acknowledgements
- References
رئوس مطالب
- چکیده
- کلید واژه ها
- 1. مقدمه
- 2. رویکرد ارزش حفاظت: چشم اندازی مبتنی بر ارزش روی منابع زیست محیطی
- 3. شناسایی گردانندگان ارزش در اکو بهره وری شرکتی
- 4. اعمال تجربی در بخش تولید ماشین
- 5.. بحث و مفاهیم
- 6. ارتباط مدیریتی
- 7. نتیجه گیری
Abstract
Eco-efficiency is oftentimes considered the gold standard for managerial decision making in an environmental context because it seemingly reconciles the efficient use of capital and the efficient use of environmental resources. We challenge this view by disaggregating eco-efficiency to provide an in-depth analysis of corporate eco-efficiency and to identify the drivers of an efficient use of environmental resources. By building on the value-based approach in financial management, we extend the rationale of economic value drivers to develop drivers for the efficient use of environmental resources. We apply this logic to analyze the carbon-efficiency of major car manufacturers worldwide. The analysis clarifies the conceptual relationship between the use of economic and environmental resources by firms. The analysis shows that the drivers of capital efficiency and eco-efficiency are not fully congruent. These findings underpin critical voices that question the supposedly unproblematic link between corporate eco-efficiency and economic value creation. We illustrate that the efficient use of environmental resources is complementary rather than instrumental to capital efficiency. Consequently, the challenge of managing eco-efficiency is to unshackle it from the current capital-oriented domination. The findings provide managerial guidance on the value-creating use of environmental and economic resources. Conceptually, our argument contributes to the debate between critical and managerial perspectives on environmental accounting and helps to address the current standoff between these two camps.
Conclusions
Efficiency considerations are at the heart of managerial decision making. While the efficient use of economic capital represents a core task for managers, more and more companies need to increase the efficiency of the use of environmental resources as well. From the valuebased perspective of this paper, this means that companies should use economic capital and environmental resources more efficiently than their peers. Such a value-creating use of economic and environmental resources is, however, not unambiguous and confronts managers with a novel strategic challenge.
Managers that strive for a more efficient use of environmental resources need to know how they can increase their eco-efficiency. By building on and extending the drivers of shareholder value this paper proposes value drivers that give managers guidance on the efficient use of environmental resources. Because the analysis disaggregates eco-efficiency ratios into their economic and environmental components, value drivers of eco-efficiency cover not only the efficient use of environmental resources but also of economic capital. This approach helps to identify cases in which the creation of Sustainable Value goes alongside with the generation of economic value and managers can identify the reasons for the out- or underperformance in both the economic and the environmental domain.
The approach presented in this paper does not aim to provide an all-encompassing and comprehensive response to steer managerial decision making towards sustainability. The inherent methodological limitations of the underlying Sustainable Value approach do not allow the approach to do that. Additional and probably more radical approaches will be necessary to push the business sector further down the road towards contributing to sustainable development—approaches that include qualitative and social aspects and make reference to the absolute state of sustainability. However, the argument presented here may offer an important step towards more sustainable decision making as compared to the status quo. It contrasts fundamentally with the currently dominant instrumental logic that sees the use of environmental resources as a means to the end of economic returns (Figge and Hahn, 2008; Hahn and Figge, 2011). These existing concepts that relate environmental performance to the value drivers of shareholder value (e.g., Hart and Milstein, 2003; Reed, 1998) fall short of a complementary analysis of capital efficiency and eco-efficiency as they ultimately only target the creation of shareholder value. In other words, they conceive eco-efficiency as a means to an end rather than an end in itself. The analysis of this paper disaggregates environmental and economic performance and analyses the performance in each domain. By doing so, it unshackles managerial decision making on environmental aspects from its current economic domination (Gray and Bebbington, 2000) and provides the necessary information to manage the use of environmental resources as an end in its own right beside economic considerations.