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Linking Market Orientation and Environmental Performance: The Influence of Environmental Strategy, Employee’s Environmental Involvement, and Environmental Product Quality

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Abstract

As it has become more and more urgent to solve the problems of environmental protection, we consider it necessary to conduct multilevel studies to examine the impact of business strategy on both employees’ and firms’ performances in environmental protection. Synthesizing the perspectives of strategic orientation, corporate strategy, and firm performance, we propose a comprehensive theoretical model linking market orientation and environmental performance. Based on a survey of 134 matched chief executive officers, senior marketing managers and frontline workers from Chinese firms, we found that market orientation positively affects environmental strategy which, in turn, influences both environmental product quality and employees’ environmental involvement. These latter two variables consequently have a positive influence on environmental performance. At the same time, environmental commitment moderates the link between market orientation and environmental strategy.

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Notes

  1. As an environment that encompasses the interaction of all living species, the natural environment encompasses all living and non-living things occurring naturally on earth or some region thereof (Johnson et al. 1997).

  2. Before testing our hypotheses using structural equation modeling, we applied regression analyses and assessed the multicollinearity using the variance inflation factor (VIF). Research (e.g., Joreskog and Sorbom 1989) suggests that a VIF score greater than 4.0 may indicate an unacceptable multicollinearity. The VIFs for our regression analyses are well below 4.0 so that we conclude there is no evidence of significant multicollinearity in our regressions.

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Acknowledgement

This paper was supported by Humanities and Social Sciences Foundation of the Ministry of Education of China (No. 10YJC630258), National Social Science Fund (No. 13CGL072), and Shanda Independent Innovation Fund (No. IFW12063; No. IFYT12063).

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Authors and Affiliations

  1. School of Business Administration, Southwestern University of Finance and Economics, No. 555, Liutai Road, Wenjiang District, Chengdu, Sichuan, 611130, People’s Republic of China

    Yang Chen & Jiafei Jin

  2. School of Business, Shandong University, Jinan, Shandong, People’s Republic of China

    Guiyao Tang

  3. Department of Management, School of Business, Hong Kong Baptist University, Waterloo Road, Kowloon Tong, Hong Kong, People’s Republic of China

    Ji Li

  4. Department of Management, Faculty of Business Administration, Laval University, Pavillon Palasis-Prince, Local 1638, 2325, rue de la Terrasse, Quebec, QC, G1V 0A6, Canada

    Pascal Paillé

Authors
  1. Yang Chen
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  2. Guiyao Tang
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  3. Jiafei Jin
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  4. Ji Li
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  5. Pascal Paillé
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Corresponding author

Correspondence to Jiafei Jin.

Appendix: Items for Primary Measures

Appendix: Items for Primary Measures

Market orientation [from Zhou et al. (2008)]

Customer orientation

  1. 1.

    Our business objectives are driven primarily by customer satisfaction.

  2. 2.

    Our strategies are driven by beliefs about how we can create greater value for customers.

  3. 3.

    We emphasize constant commitment to serving customer needs.

Competitor orientation

  1. 1.

    We regularly share information concerning competitors’ strategies.

  2. 2.

    We emphasize the fast response to competitive actions that threaten us.

Inter-functional coordination

  1. 1.

    We regularly communicate information on customer needs across all business functions.

  2. 2.

    We frequently discuss market trends across all business functions.

  3. 3.

    All of our business functions are integrated in serving the needs of our target markets.

Environmental strategy [from Banerjee et al. (2003)]

  1. 1.

    Our firm has integrated environmental issues into our strategic planning process.

  2. 2.

    In our firm, quality includes reducing the environmental impact of products and processes.

  3. 3.

    At our firm we make every effort to link environmental objectives with our other corporate goals.

  4. 4.

    Environmental issues are always considered when we develop new products.

Environmental product quality [from Kuei et al. (2012) and Dunk 2002]

  1. 1.

    Our firm improves the overall product quality due to green product innovation

  2. 2.

    Our firm improves the overall product quality due to green process innovation

  3. 3.

    Our firm improves the overall product quality due to green project innovation

  4. 4.

    Our firm improves the overall product quality due to green managerial innovation

Employees’ environmental involvement [from del Brío et al. (2007)]

  1. 1.

    In our firm, environmental issue is included in our tasks

  2. 2.

    In our firm, we involve in and are responsible for emergent environmental answers

  3. 3.

    Our firm treats our suggestions as idea sources in order to improve the environmental performance

  4. 4.

    Our firm has formal teams in order to identify the environmental problems and opportunities, and to suggest solutions

Environmental commitment [from Banerjee et al. (2003)]

  1. 1.

    The top management team in our firm is committed to environmental preservation.

  2. 2.

    Our firm’s environmental efforts receive full support from our top management.

  3. 3.

    Our firm’s environmental strategies are driven by the top management team.

Environmental performance [from Judge and Douglas (1998)]

  1. 1.

    Complying with environmental regulations

  2. 2.

    Preventing and mitigating environmental crises

  3. 3.

    Limiting environmental impact beyond regulatory compliance

  4. 4.

    Educating employees and the public about the environment

Financial performance [from Judge and Douglas (1998)]

  1. 1.

    Our profitability has been substantially better.

  2. 2.

    Our return on investment has been substantially better.

  3. 3.

    Our sales growth has been substantially better.

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Chen, Y., Tang, G., Jin, J. et al. Linking Market Orientation and Environmental Performance: The Influence of Environmental Strategy, Employee’s Environmental Involvement, and Environmental Product Quality. J Bus Ethics 127, 479–500 (2015). https://doi.org/10.1007/s10551-014-2059-1

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  • DOI: https://doi.org/10.1007/s10551-014-2059-1

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