The influence of cooperative relations of small businesses on environmental protection intensity

• Author: Manuel Platero‐Jaime,Pablo Esteban-Sánchez,Sonia Benito‐Hernández
• Published date: 01 October 2016
• DOI: http://doi.org/10.1111/beer.12126
• Date: 01 October 2016

The influence of cooperative

relations of small businesses

on environmental protection

intensity

Sonia Benito-Hern

andez

1

,

Manuel Platero-Jaime

2

and

Pablo Esteban-S

anchez

2

1. Economics Department, Universidad Polit

ecnica de Madrid, Madrid, Spain

2. Business Economics Department, Universidad Europea de Madrid, Madrid, Spain

This study examines the relationship between cooperative business relations in small businesses (fewer than

50 employees) and environmental protection, one of the most important policies of social responsibility in

manufacturing. We reviewed the literature and carried out an empirical study of 930 small manufacturing

firms in Spain. Results indicate that small businesses that maintain and improve their cooperative relations

through business networking with universities, competitors, suppliers and customers spend more on

environmental protection. The managerial, practical, research and policy implications of the obtained

research findings are discussed.

Introduction

The current socio-economic context, characterized

by the disappearance of trade barriers between coun-

tries and increasingly large and homogeneous eco-

nomic systems (Benito-Hern

andez et al. 2012) favors

business innovation and competitiveness (Platero-

Jaime 2014). However, it has also resulted in the

exponential growth of problems related to the bio-

natural environment, such as global warming, air/

water pollution and land degradation (Bagur-Feme-

nias et al. 2013). In this context, global concern

about the scarcity or depletion of natural resources,

climate change, energy security and biodiversity loss

are becoming more and more important in the busi-

ness world (Hawken et al. 1999; Wilson 2002; Keijz-

ers 2005; Rat¸iu & Mortan 2014). Increasing

environmental awareness and the growing demand

for environmental products and services has

increased interest in environmental sustainability

(ES) (popularly known as “going green”) among cor-

porate managers and entrepreneurs (Schmitter 2012;

Rat¸iu & Mortan 2014).

A popular view is that business firms should use a

triple bottom line approach (Elkington 1994) in the

conduct of business (Luken & Stares 2005; Kleine &

Hauff 2009) to become sustainable in the long term.

According to this approach, firms need to incorpo-

rate not only economic gains but also environmental

dimensions in their overall strategic agenda (Zwet-

sloot & van Marrewijk 2004; Masurel 2007; Roxas &

Chadee 2012).

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C2016 John Wiley & Sons Ltd, 9600 Garsington Road,

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doi: 10.1111/beer.12126

416

Business Ethics: A European Review

Volume 25 Number 4 October 2016

Although many studies have focused on how large

and multinational firms demonstrate their commit-

ment to the triple bottom line approach to sustain-

ability in business (Roxas & Chadee 2012), little is

known about how small firms develop strategies for

environmental sustainability (Perrini et al. 2007; Lee

& Klassen 2008; Dangelico & Pujari 2010; Kuckertz

& Wagner 2010; Martin-Tapia et al. 2010).

As SMEs are not simply smaller versions of their

larger counterparts (Shuman & Seeger 1986; Tilley

2000; Battisti & Perry 2011), different approaches

may be needed to deal with social and environmental

issues. To date, no attempts have been made to

empirically measure the ES of small firms in a devel-

oping country setting (Roxas & Chadee 2012).

Although the social and environmental impact of an

individual SME may be relatively limited, the overall

aggregate impact of such firms is sizable (Nybakk &

Panwar 2015). Tilley (2000) identified a significant

gap in the literature regarding the response of small

firms to the environmental challenge, especially liter-

ature based on analytical enquiry. Since then, the

growing recognition that SMEs have a significant

aggregate influence on the environment (Gadenne

et al. 2009) has led to studies on the environmental

management practices of smaller firms (e.g. Fuller &

Tian 2006; Perrini 2006; Perrini et al. 2007; Gadenne

et al. 2009; Lynch-Wood et al. 2009; Jamali et al.

2015; Nybakk & Panwar 2015). However, relatively

few papers have explored this issue (Oxborrow &

Brindley 2013).

Previous research has studied the different motiva-

tions of SMEs for increasing their environmental

responsibility engagement. Most of these studies

highlighted that this engagement can be encouraged

by instrumental and normative motivations. The for-

mer are usually related to business benefits such as

cost savings, risk reduction, competitive advantage

or reputation improvement, while the latter are

mainly linked to regulatory enforcement, stake-

holder pressure or owners’ values and ethical con-

cerns. Although SMEs are clearly closer to local

communities than big firms, they generally have

fewer resources to develop pro-environmental

initiatives.

In this study, we focused on the role of institu-

tional associations of Spanish SMEs themselves,

showing how small businesses that maintain and

improve their cooperative relationships and net-

working with universities, competitors, suppliers

and customers spend more on environmental

protection than those that do not. This offsets the

inconveniences related to having fewer resources and

improves the sharing of knowledge and organiza-

tional learning from environmental responsibility

practices. According to Uhlaner et al. (2012), only a

few studies have relied on inferential statistics and

large random samples of firms (including SMEs) to

test hypotheses (e.g. Russo & Fouts 1997; Perrini

et al. 2007; Brand & Dam 2009; Gadenne et al.

2009). This paper uses a large-scale sample and

statistical tools to enhance our knowledge of the

different business factors that influence the environ-

mental management practices of Spanish SMEs.

The research question we specifically addressed is:

Are certain aspects of the organizational context of

small Spanish enterprises associated with greater

environmental expenditure? The obtained results

suggest that managers and policymakers should con-

sider boosting institutional constellations that pro-

mote the above-mentioned cooperative relations and

networks and develop environmental programs with

them.

In the next section, we provide a detailed discus-

sion of the different variables analyzed and environ-

mental management practices, as well as a brief

overview of SMEs in Spain. We then briefly summa-

rize the theoretical framework, and present our

hypotheses and their rationale. The method section

explains our approaches to data collection, measure-

ment and analysis. The remaining sections cover the

results, interpretation of results, limitations of our

study, directions for future research, and finally, con-

clusions and practical implications.

Literature review

The importance of sustainable development

In recent decades, various economic agents have

become increasingly concerned about environmental

problems such as global warming partly due to CO

2

emissions, air pollution, water pollution, and land

degradation. As a result, a growing number of com-

panies have begun to adopt more environmentally

friendly business practices (Leonidou et al. 2013).

Business Ethics: A European Review

Volume 25 Number 4 October 2016

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