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The Role of Board Environmental Committees in Corporate Environmental Performance

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Abstract

This study explores the relationship between board environmental committees and corporate environmental performance (CEP). We propose that board environmental committees will be positively associated with CEP. Moreover, we argue that the composition of the committee (i.e., stakeholder representation) as well as the presence of a sustainability manager will influence this relationship. Our results find support for a positive association between board environmental committees and CEP. Further, the presence of a senior-level environmental manager positively moderates this relationship, but is not effective in isolation. Unexpectedly, no support was found for the influences of stakeholder representation.

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Notes

  1. Outside directors considered affiliates of the firm include significant shareholders (>10 % of voting shares), members of professional firms providing service to the company (e.g., law firm, commercial bank, consulting firms, etc.), officers of firms with significant supplier/customer relationship to the company, directors affiliated with non-profit institutions receiving more than $100,000 from the company that year, members with interlocking directorships, former employees, and directors receiving personal benefit from the company (individual consultant to the company, vice-chair of board) of greater than $100,000 per year.

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Authors and Affiliations

  1. Department of Management, Walker College of Business, Appalachian State University, 4087 Peacock Hall, Boone, NC, 28608, USA

    Heather R. Dixon-Fowler

  2. Department of Management, Sam M. Walton College of Business, University of Arkansas, WCOB 402A, Fayetteville, AR, 72701, USA

    Alan E. Ellstrand

  3. Department of Management, Sam M. Walton College of Business, University of Arkansas, WJWH 522, Fayetteville, AR, 72701, USA

    Jonathan L. Johnson

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  1. Heather R. Dixon-Fowler
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Correspondence to Heather R. Dixon-Fowler.

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Dixon-Fowler, H.R., Ellstrand, A.E. & Johnson, J.L. The Role of Board Environmental Committees in Corporate Environmental Performance. J Bus Ethics 140, 423–438 (2017). https://doi.org/10.1007/s10551-015-2664-7

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