Management's values, company size, competition and outside pressure all impact how much a company complies with environmental regulations in different ways, according to a new study.
Research by Oregon State University economist and professor JunJie Wu found that one of the leading factors that drives companies to exceed environmental regulations are the values of senior management. Those that believe in protecting the environment are more likely to go beyond what measures regulations call for.
Wu compiled survey answers from 689 Oregon businesses to find which factors led companies to over-comply or violate regulations, and which ones had no effect. The survey, "Environmental Compliance: The Good, the Bad, and the Super Green," was published by the Journal of Environmental Management.
Another major factor that prevents violations is competitive market forces such as improving environmental performance in order to keep up with competitors, investing in cleaner products to differentiate from competitors and taking environmental steps to reduce employee turnover and increase productivity.
But the survey also found that if a company sees costs and risks like high upfront investments, high day-to-day costs and uncertain future benefits associated with environmental practices, it's more likely to violate regulations and avoid over-compliance.
Companies with annual revenue less than $5 million and publicly-traded companies are more likely to violate regulations than larger and privately owned companies, and facilities that offer services direct to consumers or make products sold direct to consumers are also less likely to violate regulations.
Pressure from consumers, investors and interest groups, though, has no statistically significant impact on company actions.
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