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RESEARCH IN PROGRESS – PLEASE DO NOT QUOTE OR CITE WITHOUT

PERMISSION OF THE AUTHORS

May 11, 2013

Collaborative Governance and Corporate Environmental

Compliance in China1

Paper Prepared for the Association for Public Policy Analysis and Management (APPAM)

International Conference on “Collaboration among Government, Market, and Society:

Forging Partnerships and Encouraging Competition”

Fudan University, Shanghai, China

May 26-27, 2013

Ning Liu2

Carlos Wing-Hung Lo

Xueyong Zhan

Department of Management and Marketing

The Hong Kong Polytechnic University

Hung Hom, Kowloon, Hong Kong

1 Research for the article was supported in part by the Competitive Research Grants for Newly Recruited

Junior Academic Staff (Project No. G-YJ58) of the Hong Kong Polytechnic University and the project

“Changes in the Enforcement of Environmental Regulations in China: A Longitudinal Study of

Environmental Enforcement Officials in Three Cities” of the Research Grants Council of the Hong Kong

Special Administrative Region (RGC No.: PolyU5469/10H). 2 Corresponding author. Please address comments to nicole.liu@connect.polyu.hk, Tel: (852) 64826319

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Abstract

Existing literature reveals that corporate environmental performance is largely

conditioned by regulatory pressures; yet little has been written on the ways regulated

enterprises respond to external regulatory pressures and to what extent the styles of

corporate compliance are related to corporate environmental performance. Drawing on

the literature of environmental governance and corporate management, we explore how

regulated enterprises allocate resources in different compliance styles- formalism,

accommodation, referencing, and self-determination -to achieve proactive environmental

management (PEM). Using survey data collected from 192 manufacturers in China, this

article examines the mediating effects of corporate compliance styles in bridging

organizational resource and PEM, as well as how corporate green commitment moderates

these influences. We find that two voluntary compliance style dimensions (self-

determination and referencing) have stronger bridging role in transforming organizational

resource into corporate progress in PEM: the bridging role of self-determination is more

significant in firms with higher level of green commit; and the bridging role of

referencing is more significant in firms with lower level of green commit. Moreover, the

two responsive compliance style dimensions (formalism and accommodation) do not

show significant bridging functions.

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Collaborative Governance and Corporate Environmental Compliance

in China

The literature of collaborative governance argues that collaborations between

government agencies and business firms are necessary conditions for effective making

and implementation of public policy (Daley, 2009; Freeman, 1997; Gunningham, 2009).

Existing studies of environmental governance have also examined a wide array of

voluntary and negotiated agreements between business firms and stakeholder groups to

ensure better environmental performance (King, 2007; Rondinelli & London, 2003).

However, little has been written on the organizational mechanisms through which firms

respond to environmental regulation. How do regulated enterprises respond to external

regulatory pressures? In what ways and to what extent the styles of corporate compliance

are related to corporate environmental performance?

In this study, we seek to address this research gap by examining the bridging role

of corporate compliance styles (CCS) in transforming organizational resource into

corporate progress in proactive environmental management (PEM), and we further

investigate whether the mediation effect of CCSs depends on firms’ green commitment.

We test our hypotheses by using survey data collected from 192 manufacturing

companies in China. We found that the mediation effect of CCS only exists in voluntary

compliance style dimensions (self-determination and referencing). Such mediating effect

depends on firms’ corporate green commitment level. The bridging role of self-

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determination in transforming organizational resource into corporate progress in PEM is

more significant in firms with higher level of green commit; and the bridging role of

referencing is more significant in firms with lower level of green commit. Moreover, the

two responsive compliance style dimensions (formalism and accommodation) do not

show significant bridging functions.

This paper is organized as follows. We will first provide an overview of the

current literature on corporate environmental management. Next, we develop hypotheses

on the mediating effects of corporate compliance styles in bridging organizational

resource and PEM and how corporate green commitment moderates these influences.

After the introduction of data collection methods, we present our data analyses and

results. The paper concludes with the discussions on the theoretical contributions of our

research and its practical implications.

Theoretical Background

Proactive Environmental Management (PEM)

PEM refers to business environmental actions that focus on all the negative

impacts associated with the full life cycle of a product (Liu et al., 2010; Lo, Fryxell, &

Tang, 2010). As a result of a wide range of organizational and managerial choices, PEM

aims more than fulfilling environmental regulations (Sharma, 2000). Thus, the

development and adoption of proactive environmental programs is a more comprehensive

process than compliance, and thus it requires greater managerial efforts.

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Usually, the comprehensiveness of a firm’s environmental management is

embodied in a series of environmental strategies, goals, administrative procedures and the

practical efforts to improve environmental performance (Coglianese & Nash, 2001).

However, firms differ in the extent to which these programs are genuinely integrated into

business operation. In China, for instance, although recent years have witnessed

increasing business awareness of environmental programs, internal implementation may

be a barrier in many business cases (Lo, Fryxell, & Tang, 2010). Therefore, in this study

we examine PEM by measuring the extent to which firms integrate proactive

environmental programs into business operations rather than simply counting the number

of programs.

A natural-resource-based-view of firm

The natural-resource-based view (NRBV) of firm (Hart, 1995) is a dominant

strategic management perspective to study corporate greening. Its fundamental principle

is that the basis for competitive advantages lies primarily in the application of valuable

resources and capabilities on environmental issues. It focuses on resources that allow

firms to reduce the negative impact on the natural environment, and thus addresses the fit

between what a firm is capable of and what it has the opportunity to do on environmental

issues (Berchicci & King, 2007; Russo & Fouts, 1997). Therefore, it helps to understand

how firms could achieve competitive advantage by developing unique capabilities and

proactive environmental strategies (Hart, 2011; Sharma & Vredenburg, 1998).

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Corporate compliance style dimensions

How regulated enterprises respond to external demands could also affect

corporate environmental performance. CCSs are defined as the general approaches

adopted by regulated actors to meet regulatory requirements, and the emerging research

suggests four dimensions of CCS —formalism, accommodation, referencing, and self-

determination (Liu et al., working paper). In this study we further categorize these four

dimensions into two groups, namely responsive and voluntary styles. Formalism and

accommodation are more responsive in nature. The “formalism” dimension refers to a

traditional “go-by-the-book” approach that strictly follows formal rules within a

command-and-control regulatory context (Scholz and Pinney 1995; Winter and May

2001); The “accommodation” dimension gives priority to dealing with political or

bureaucratic pressures (Levy and Egan 2003; Cho, Patten, and Roberts 2006).

Referencing and self-determination are more voluntary in nature. The “referencing”

dimension embraces a close imitation of peer enterprises’ compliance practices and

follows professional guidelines recommended by industrial trade associations (Dawson

and Segerson 2008). The “self-determination” dimension refers to a discretionary

approach that emphasizes intellectual flexibility, self-discretion, and autonomy (Oliver

1991; Sharma 2000).

Corporate green commitment

Existing literature has also identified the importance of normative commitment as

a determining factor of corporate environmental performance (Scholz & Lubell, 1998;

Weaver, Treviño, and Cochran, 1999). Among the very limited studies that explore the

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role of green commitment, many adopted a behavioral perspective. For instance,

Coglianese and Nash (2001) labeled managerial attitudes and actions as commitment in

shaping corporate performance of environmental management system (EMS). According

to Henriques and Sadorsky (1999), corporate commitment to the natural environment can

be defined as what a company is doing or has done with reference to environmental

issues. Similar definitions are also adopted by Ramus and Steger’s study (2000) about the

effect of perceived corporate commitment on environment policy and employee

innovation as well as Roy et al.’s study (2001) on the determinants of environmental

commitment.

To capture the role of corporate green commitment (CGC) in determining

proactive corporate environmental management, in this research we adopt Meyer and

Allen’s (1991) organization commitment (OC) model, and define CGC as the strength of

a firm’s identification with and willingness to improve environmental performance.

Similar to the OC, CGC can also be characterized by at least three factors (Meyer &

Allen, 1991): (a) a strong belief in and acceptance of the goals and values in

environmental protection; (b) a willingness to exert a great deal of effort to achieve

environmental goals; and (c) a definite desire to maintain a membership of green

companies.

Research Hypotheses

The positive association between organizational resources (capabilities) and

environmental performance has been confirmed in a large number of NRBV studies (e.g.,

Aragón-Correa & Sharma, 2003; Russo & Fouts, 1997; Sharma & Vredenburg, 1998).

Proactive environmental programs, such as the ISO 14001 certification, require more

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corporate efforts in internal environmental management than remedial actions. A study in

China also found that ISO-certified firms did not fully implement the standards, and one

major reason is the high costs of complying with the continual improvement principle of

management system standards (Yeung & Mok, 2005). Following these existing insights,

we hypothesize the direct influence of a firm’s resource endowment on its proactive

environmental performance as below:

Hypothesis 1. A firm’s resource availability (RA) is positively related to its

proactive environmental management (PEM).

Besides a direct impact, a firm’s resource availability could also affect its

proactive environmental management via adopting a certain compliance style. To

enterprises, resource application is far from simple investment in green technologies

nowadays but involves more complex relationships with external stakeholders. For

instance, accommodative firms usually take proactive stand to deal with bureaucratic

stakeholders, who exert additional demands on enterprises to reduce existing pollution,

and hence firms are more likely to have an integrated PEM. The greater latitude on how

to meet goals also allows firms time to deploy new means to meet goals (Majumdar &

Marcus, 2001). Therefore, we develop a general hypothesis that a firm’s CCS adoption

level plays an important role in bridging firm’s resource endowment and PEM:

Hypothesis 2. Corporate compliance styles (CCSs) mediate the positive association

between firms’ resource availability (RA) and proactive environmental

management (PEM).

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We propose that the positive association between RA and PEM through CCS

depends on firms’ green commitment. Firms with a higher degree of green commitment

are more likely to integrate formal demands into its daily practices to obtain continuous

environmental improvement. Less committed firms may adopt a ceremonial behavior to

reconcile regulatory pressure without genuine progress (Weaver, Treviño, and Cochran,

1999). Highly committed enterprises are likely to overestimate the potential benefit either

to the firm or to the society and nature through accommodating additional political

demands, while less committed may concern the cost more. Hence we suppose that CGC

could strengthen the mediated effect of formalism and accommodation.

Whether referencing firms will take proactive actions depends on how they

perceive peers are doing. Firms with a high level of CGC are more likely to follow

proactive models while those with a low CGC may think it is unnecessary to invest in

greener technologies, or even follow bad apples. The latter is common in a loose

regulated context where the number of firms in non-compliance far outweighs that of

beyond-green firms. Under this circumstance, the more a firm keeps consistent with

peers, the less likely it will integrate environmental programs into business core practices.

In terms of self-determination, managers who view environmental protection as an

essential condition of firm’s survival or further development is more likely to encourage

internal eco-innovation to promote environmental performance than who perceive

environmental protection as a non-necessary issue. Likewise, firms that strongly perceive

reducing environmental harm to be a social duty is more likely to engage in

environmental practices than those consider it to be less social responsible (Gunningham

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& Grabosky, 1998). Nevertheless, less committed firms are more likely to race to the

bottom rather than being environmental proactive. Thus, we predict that:

Hypothesis 3. CGC moderates the indirect effect of RA on PEM through CCSs.

The mediation effect of CCS is stronger when a firm has a higher degree of green

commitment.

Figure 1 about here

Methodology

Sample and Data Collection

We collected data by conducting questionnaire surveys with manufacturing firms

operating in the Pearl River Delta (PRD), Guangdong Province, China. The region leads

the nation as the forerunner of local environmental reform, making it a useful window for

identifying the frontier of ecological modernization in China (Yee, Lo, and Tang 2013).

Indeed, enterprises in this region have been increasingly under more legalistic regulation

and stricter enforcement from local EPBs (Francesch, Lo, and Tang 2012; Zhan, Lo, and

Tang forthcoming). At the same time, these enterprises have been under greater societal

and market demands for industrial pollution reduction from an increasingly affluent

society (Lo, Fryxell, and Tang 2010).

The questionnaire survey was administered in two stages. The pilot survey was

performed in late 2010 in a business environmental seminar with the objectives of pre-

testing the reliability of key variables and helping troubleshoot the questionnaire for the

main survey. Out of 110 questionnaires distributed, 71 were returned, with a response

rate of 61.7%. The Cronbach’s alphas range between 0.76 and 0.92, indicating that the

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measurements were reliable (Nunnally 1967). The main survey was implemented in early

2011, with logistic support from the management offices of four industrial parks in the

PRD region. Among the 300 enterprises selected, 121 of them responded, representing a

response rate of 40.3%.3 As a whole, a total of 192 completed questionnaires were

collected for data analysis.

Measurement

We developed the measurements following well-tested constructs in the current

literature. Items were first reviewed by a group of academics, industry experts, and local

EPB officials to ensure that the measures are relevant and easy to understand. Revisions

to the questionnaire were made based on these inputs. All items were measured in a

seven-point scale (1=extremely disagree, 7=extremely agree).

Dependent Variable

Proactive environmental management (PEM) is the dependent variable in this

study. It is difficult to measure a firm’s environmental proactive level since it does not

necessarily equal the sum of environmental plans and tools. A more feasible way is to

identify the major environmental programs/initiatives adopted to reflect a firm’s

proactive level. Based on the measurements developed in corporate environmental

management studies (particularly those in the Chinese regulatory context, e.g. Liu et al.,

2010; Lo, Fryxell, & Tang, 2010; Yee, Lo, & Tang, 2013), we asked respondents to

3 Response rates in both surveys were higher than those in recent environmental studies in U.S. (20%,

Christmann 2004; 13%, Darnall, Potoski, and Prakash 2010; 11.2%, Delmas and Keller 2005) or China (10.2%, Liu et al. 2010). This is perhaps due to the assistance we obtained from firms’ key stakeholders.

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describe the integration extent of 10 environmental programs into their management. By

providing intermediate values for enterprises that were considering or on the way of

taking up a green practice, we were able to obtain a more nuanced measure than a simple

dichotomous response that whether or not the company had already adopted it. For each

practice, we asked respondents: “What is the status of this practice (e.g. ISO 14001

certification), in your firm?” We presented the following seven-point scale: “not being

considered” (coded 1), “considered with no further implementation” (2), “pilot it without

official implementation” (3), “implemented but not the focus” (4), “currently

implementing as a focus” (5), “implementation and closely connected to other

departments” (6), and “successfully implemented as an integral part of business

operation” (7). We then summed them together to measure PEM (Cronbach’s alpha: .93).

Independent variables

RA: The measurements for resource availability are adapted from Russo and

Fouts (1997), which capture managers’ perceptions of a firm’s resource endowment. A

total of 12 items were used, including those related to technical resources, human and

financial capital, and various intangible resources. The Cronbach’s alpha is .87.

CCS: CCS is measured by 16 items, each with a statement for respondents to

indicate how strongly they agree that their company has adopted a certain compliance

style dimension. The Cronbach’s alphas of the four dimensions are: formalism (3

items)—α=.70, accommodation (4 items)—α=.72, referencing (4 items)—α=.78, self-

determination (3 items)—α=.73. The exploratory factor analysis results suggested that

four components accounting for 63.6% of the variance among the fourteen items. The

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CFA results showed that the hypothesized four-factor model yields a good fit (CFI= .95,

TLI = .93, RMSEA = .05; Chi-square = 102.52, Degrees of freedom = 66, p < .01). A

better fit was noted when compared with the one-factor model (∆χ2 =300.45, ∆ df=11,

p<.001). The χ2 /degrees of freedom (d.f.) ratios 1.55 (<2.0) indicates a very good fit

(Hair et al. 2010), and the RMSEA of 0.05 here is below the standard threshold (.08).

CGC: we developed the CGC measuring items by adapting Meyer and Allen’s

(1997) scale as the most widely used organizational commitment measurement. To be

more suitable for the re-conceptualized construct of corporate green commitment in this

research, we further revised the original items and excluded those not related to corporate

environmental management. A total of 11 items were phrased. Sample items are “we are

very proud to devote efforts into environmental issues” and “A green company is what

we aim at”. The Cronbach’s alpha was .85. Since we did not further differentiate the role

of sub-commitment dimensions, further validating analysis was not conducted.

Control Variables

Several control variables are included in the analysis: (1) years of operation in the

current location, (2) firm size, (3) export proportion, and (4) ownership. Firm size is

measured by the number of employees, and the effect of export proportion is controlled

by measuring export ratio in the firm’s annual sales. We introduced three dummy

variables to differentiate firms among four ownership groups: state-owned enterprises

(SOEs), state-controlled joint ventures (SJVs), foreign-controlled businesses (FCBs), and

privately owned enterprises (POEs).

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Results

Table 1 presents means, standard deviations, and correlations. Table 2 provides a

summary of surveyed companies’ PEM. The top four integrated environmental programs

(rated 5-6) are: recycling of resources and byproducts ( x = 5.39), routine environmental

audits ( x = 5.22), EMS certifications, ( x = 5.18), reduction in resources consumption

( x = 5.08). The least adopted proactive environmental practice is drafting an annual

environmental report ( x = 4.56), which is consistent with previous empirical results in

studying corporate environmental management in China (Liu, et al. 2010).

Table 1 about here

Table 2 about here

Tests of Mediation

We follow Baron and Kenny’s (1986) three criteria to test the mediation effects.

Table 3 shows the results. After entering all the control variables, RA was found

positively related to PEM (b = .712, p < .001). Therefore, hypothesis 1 is supported. At

the same time, RA was positively related to an adoption of accommodation (b = .473, p <

.001), referencing (b = .532, p < .001), self-determination (b = .462, p < .001), and

formalism (b = .543, p < .001). However, none of the CCSs (accommodation: b = .002,

n.s.; self-determination: b = .038, n.s., and formalism: b = -.089, n.s.) was related to PEM

when controlling the effect of RA, except referencing (b = .124, p < .05). In other words,

firm with more environmental resources are more likely to learn from external reference

groups, which in turn will lead to a better environmental performance. Thus Hypothesis 2

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about the mediation effect of CCSs is partially supported. Although the mediation model

was not significant, it suggested the presence of a potential moderator regulating the

mediation effects on PEM.

Table 3 about here

We also used a SPSS macro developed by Preacher and Hayes (2008) to test the

multiple mediator models. The advantage of testing them simultaneously is that one

learns if the mediation is independent of the effect of the other mediators4. The bootstrap

estimates are based on 5,000 bootstrap samples. An examination of the specific indirect

effects indicates that among all the four CCSs, only referencing is a mediator, since its

95% CI does not contain zero. In agreement with results of the product-of-coefficients

strategy, referencing dimension is the only significant mediator of the RA-PEM

relationship.

Tests of Moderated Mediation

Hypothesis 3 predicted that CGC moderates the indirect effect of RA on PEM

through CCSs, such that the mediation effect of CCS on the association between RA and

PEM are stronger when CGC level is high. We conducted hierarchical multiple

regressions to test our hypotheses following the steps suggested by Muller, Judd, and

Yzerbyt (2005). Following their procedure, the moderated mediation effect on PEM will

be confirmed if 1) b11 is significantly different from zero while b13 is not. 2) either (or

4 Following the advice of Baron and Kenny (1986) that different mediators should be conceptually distinct

and not too highly correlated, we found that the correlations of four CCSs ranging from .247 to .400.

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both) of two patterns should exist: both b23 and b34 are significant or both b21 and b35 are

significant. Three models as following were tested:

Y=b10+b11X+b12Mo+b13XMo+e1 (1)

Me=b20+b21X+b22Mo+b23XMo+e2 (2)

Y=b30+b31X+b32Mo+b33XMo+b34Me+b35MeMo+e3 (3)

As shown in column 2-4 in Table 4, the results from equation 1 indicate an overall

effect of RA on PEM (b11 = .892, p < .001). This effect is not moderated by CGC (b13 = -

.085, n.s.). In equation 2, there is a significant effect of RA (b21 = .437, p < .001) and a

significant RA × CGC interaction (b23 = -.112, p < .05) on the referencing dimension.

From the equation 3 results, we see that there is a significant effect of referencing on

PEM (b34 = .155, p < .05). Moreover, this is not moderated by CGC (b35 = .093, n.s.).

Thus a significant moderated mediation is noted: the effect of RA on referencing depends

on CGC, and the average partial effect of CGC on PEM is nonzero.

Column 2, 5, and 6 in Table 4 show the results of moderating role of CGC with

self-determination being the mediator. In equation 2, there is a significant effect of RA

(b21 = .291, p < .05) on self-determination. Moreover, this is not moderated by CGC (b23

= -.064, n.s.). In the equation 3 results, there is an insignificant effect of self-

determination on PEM (b34 = .06, n.s.) and a significant CCS × CGC interaction (b35 =

.243, p < .01). This significant interaction is indicative of moderated mediation. It means

that the magnitude of the indirect effect of RA, via self-determination, varies in

magnitude as a function of CGC. In other words, the partial effect of the mediator on the

outcome depends on the moderator (b35 ≠ 0), and there is an overall treatment effect on

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the mediator (b21 ≠ 0). As shown in column 2, 7, 8, 9, 10 in Table 4, the moderated

mediation of accommodation (b35 = -.056, n.s.) and formalism (b35 = -.050, n.s.) are not

significant.

Table 4 about here

Overall, H3 is partially supported. The effect of RA on referencing depends on

corporate green commitment, and the indirect effect of RA on PEM through self-

determination is depending on CGC. Figure 2 plots the interactive effect of self-

determination and CGC on PEM following the procedures outlined by Aiken and West

(1991) for testing simple slopes. As posited, the self-determination dimension is not

related to PEM (b = -.183, n.s.) when CGC is low but positively related to PEM (b =

.303, p < 0.01) when a firm’s CGC level is high. Similarly, Figure 3 shows the plot of the

interactive effect of RA on referencing at +/－ SD around the mean of CGC. The

positive effect of resource availability on the referencing dimension is weaker under

conditions of a high green commitment (simple slope test: b = .328, p < .05) than it is low

(simple slope test: b = .542, p < .001). Therefore, the mediating effect of referencing is

stronger in firms with a lower level of green commitment.

Figure 2 about here

Figure 3 about here

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Discussions

Although resource availability is still a fundamental determinant of PEM, there

are indirect mechanisms through which such positive association sustains. In this study,

we explore how regulated enterprises allocate resources in different compliance styles-

formalism, accommodation, referencing, and self-determination -to achieve proactive

environmental management (PEM). Our empirical results have identified the mediating

effects of corporate compliance styles in bridging organizational resource and PEM, and

we also found that corporate green commitment can moderate these influences in subtle

ways.

A very interesting finding is that responsive and voluntary dimensions differ in

their role in connecting organizational resources with PEM. The finding that only

voluntary compliance style dimensions successfully translate firm capability into

proactive environmental management may suggest that firms’ intrinsic motivation is

indispensable in achieving environmental progress. The insignificant role of formalism

and accommodation might be partly explained by the unique regulatory context in China.

With regard to formalism, existing command-and-control dominated regulation may have

not provided enough incentives and guidance for firms to pursue progressive

improvement. In terms of accommodation, on one hand, it may means selectively joining

less investment-intensive programs that help secure minimum or symbolic compliance

instead of genuine improvement in proactive performance. On the other hand,

compromising with political demand may distract firms from focusing on their own

priority since many of those demands are temporary instead of a long-term cooperative

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form. Another possible sequel of “effective political intervention” might be the

undermined regulatees’ perceived legitimacy of environmental laws and regulations

(MacLean & Behnam, 2010). Overstated political interference may lead to a fallacious

perception of regulatees that consistent abidance with laws and regulation is unnecessary.

To achieve real environmental progress, therefore, a significant role of business internal

commitment should not be ignored in regulatory policy design and collaborative

environmental governance.

What approach that firms adopted to respond external regulatory pressure is

neither a sufficient nor necessary condition of better performance. The road towards

proactive corporate environmental management is quite different among firms with

different degree of green commitment. Corporate green commitment affects the

translation of compliance styles into actual proactive performance in an enterprise. In

firms with a higher level of green commitment, improved PEM is less likely to be

realized through referencing but more likely to be realized via emphasizing self-

discrepancy.

Overall, our research suggests that the existing theories on corporate compliance

and environmental management can be applied to the Chinese context to a large extent.

For example, the temporal natural-resource-based view of the firm can be applied to

study corporate greening process. Nevertheless, the specific compliance style dimensions

that firms adopted to respond to environmental regulation, and the mechanisms through

which these dimension transform organizational capability into genuine progress in PEM

may differ among regulatory regimes. Although corporate compliance in China is usually

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largely related to accommodation when political and societal pressures are in place, what

cannot be ignored is that regulated enterprises are becoming increasingly independent in

pursuing proactive corporate environmental management.

Conclusions

This study contributes to the existing literature of environmental governance and

corporate environmental management on at least two fronts. First, the co-existence of

four CCSs shows that business firms do take requests from a variety of external

stakeholders into consideration and respond in different ways. The failure of formalism

and one-way accommodation by regulatees indicates that a collaborative scheme or

mutually beneficial government-business relationship is more promising in bringing

firms into proactive environmental management. Given the importance of intrinsic

motivation in promoting proactive corporate environmental management, environmental

policy making and implementation should pay more attention to the ways to enhance

firms’ intrinsic motivation for environmental protection. Furthermore, our findings

identify the importance of a multiple-stakeholder perspective in collaborative

environmental governance.

Second, by linking organizational commitment with corporate compliance, this

study suggests that a significant role of business internal commitment should not be

ignored when promoting proactive corporate environmental management. Our research

has identifed that in the developmental context of China, an increasing number of firms

have taken up environmental management practices due to internal commitment and

entrepreneurial spirit, instead of passive response to external pressure (as suggested in the

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conventional visdom), resembling a possible trend towards ecological modernization in

China (Mol, 2006; Yee, Lo, & Tang, 2013).

This research does have a few limitations. First, the survey was limited to one

specific region in China. Thus we cannot generalize our results to all firm types. A

second limitation is that because the research design was cross-sectional, the current

study is not able to inform CCSs changes over time. Therefore, many research questions

remain on both the theoretical and empirical research agenda to further study CCS. That

being said, this research has at least two major practical implications. To policy makers,

it is necessary to understand that firm-level diversity in environmental approaches and the

level of green commitment matters. Nevertheless, not all roads lead to Rome if policy

makers cannot adopt a combination of policy instruments to induce and encourage firms

with different environmental preferences to go proactive. Meanwhile, for regulated

enterprises, green commitment deserve further attention in order to improve a firm’s

environmental performance. Managers should realize that whether a selected

environmental approach or strategy can achieve an expected goal depends a lot on the

extent to which the company is genuinely committed to environmental protection.

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Attached figures

Figure 1 The Moderated Mediation Model

Attached tables

Figure 2 Interaction between Self-determination and CGC on PEM

Resource

Availability

Corporate Green

Commitment

Corporate

Compliance

Styles

Proactive Corporate

Environmental Management

27

Figure 3 Interaction between RA and CGC on Referencing

28

Attached tables

Table 1 Descriptive Statistics and Correlations

Mean

Std.

Deviation

1 2 3 4 5 6 7 8 9 10 11 12 13

1. RA 5.4157 .86168 1

2. Accommodation 5.4115 .94860 .462** 1

3. Referencing 5.2305 1.14405 .570** .351** 1

4. Self-determination 5.2521 1.08553 .452** .292** .400** 1

5. Formalism 5.7378 .99160 .524** .388** .285** .247** 1

6. CGC 5.6243 .79150 .786** .416** .495** .426** .543** 1

7. PEM 5.0193 1.36929 .734** .338** .526** .389** .276** .590** 1

8. Operation years 2.30 1.361 -.112 -.034 -.147* .046 .014 -.102 -.231** 1

9. Firm size 2.04 1.106 -.057 -.058 -.093 .153* -.076 -.025 -.057 .638** 1

10. Export 4.19 2.038 -.030 -.043 -.102 -.127 -.030 .039 -.088 -.058 -.139 1

11. Ownership_d1 .68 .469 .189** .100 .252** .006 .050 .177* .256** -.369** -.328** -.069 1

12. Ownership_d2 .17 .374 -.115 -.065 -.213** .021 -.027 -.022 -.153* .262** .265** .093 -.648** 1

13. Ownership_d3 .13 .332 -.058 -.040 -.042 -.020 .015 -.101 -.146* .076 .109 .023 -.547** -.169* 1

29

Table 2 Descriptive Statistics of PEM (N=192)

Mean Std. Deviation

Clean Production Assessment 4.98 1.780

EMS certifications, such as ISO 14001 5.18 2.011

Reduction in resources consumption, such as clean water and electricity, et al. 5.08 1.621

Substitution by renewable materials or energy sources 5.39 1.594

Routine environmental audits 5.22 1.645

Environmental training for managers 5.00 1.750

Environmental training for operatives 4.90 1.741

Setting environmental performance objectives as part of the annual business plans 4.93 1.705

Including environmental performance measures in management evaluations 4.95 1.801

Preparation and release of environmental reports 4.56 1.865

Table 3 Regression Results of the Mediating Role of CCSs (N=192)

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Steps and variables Estimate Estimate Estimate

(a) Control variables

Years of operation -.245*** .079 -.023 -.017 .159 -.227**

Firm size .156* -.088 -.004 .145 -.165 .136*

Export -.047 -.037 -.079 -.099 -.034 -.036

Ownershipd1 -.159 .080 .249 -.032 .008 -.188

Ownershipd2 -.184 .048 .042 .031 .051 -.186

Ownershipd3 -.268 .044 .089 -.049 .111 -.268*

RA .712*** .473*** .532*** .462*** .543*** .676***

Accommodation .002

Referencing .124*

Self-determination .038

Formalism -.089

Model F statistics 30.033*** 7.6*** 14.15*** 7.76*** 10.78*** 24.16***

Adjusted R2 .21*** .34*** .21*** .28*** .59***

30

Table 4 OLS regression results of moderated mediation

Referencing Self-determination Formalism Accommodation

Model 1 Model 2a Model 3a Model 2b Model 3b Model 2c Model 3c Model 2d Model 3d

Predictors

Years of

operation

-.301** .095 .012 .098 -

.303**

.093 .010 .103 -.322 .093 -.009 .073 -.210** .070 .055 .101 -.214** .070

Size .189* .092 .006 .097 .192* .091 .129 .100 .193 .091 .142* .088 .122 .068 -.039 .098 .136* .068

Export -.069 .069 -.079 .071 -.061 .067 -.122 .074 -.044 .068 -.173 .086 -.058 .050 -.039 .073 -.053 .051

owner_dummy1 -.580 .454 .340 .466 -.253 .451 -.305 .490 -.546 .444 -.058 .064 -.232 .158 .061 .226 -.201 .156

owner_dummy2 -.807 .464 -.024 .473 -.263 .457 -.172 .501 -.812 .453 -.115 .197 -.235 .127 .119 .184 -.232 .128

owner_dummy3 -1.216* .486 .143 .500 -.382 .478 -.354 .525 -1.188 .475 -.059 .161 -.302* .119 .100 .171 -.292* .118

X: RA .892*** .110 .484*** .086 .796** .087 .291* .118 .908*** .109 .249* .102 .677*** .081 .303*** .116 .655*** .082

MO: CGC .030 .116 .057 .085 .073 .082 .215 .125 .017 .114 .440*** .107 .077 .089 .161 .123 .041 .087

XMO: RACGC -.085 .053 -.115* .053 -.106 .062 -.064 .057 -.197** .064 .059 .049 -.032 .050 .047 .056 -.036 .047

ME: .190* .087 .060 .076 -.111 .062 -.033 .053

MEMO: .091 .075 .243** .078 -.050 .067 -.056 .062

* p < 0.05, **p < 0.01, ***p < 0.001

31