Main Article Content
Abstract
Purpose: This systematic review investigates the complex relationship between environmental policies and corporate strategies, aiming to understand their mechanisms and impacts. The goal is to comprehensively analyze existing literature to determine how environmental policies shape firms' strategic behaviors and organizational outcomes.
Research Design and Methodology: Employing a systematic approach, this study synthesizes diverse sources and disciplines to identify key drivers and barriers influencing firms' responses to environmental policies. Quantitative and qualitative methodologies are integrated to explore the dynamic relationship between regulatory compliance and corporate strategies.
Findings and Discussion: The findings reveal that regulatory compliance drives innovation in firms, advancing sustainability practices and competitive advantage. Additionally, integrating environmental considerations into corporate governance enhances resilience and promotes a culture of sustainability. The discussion highlights the positive impact of regulatory-induced innovation on firms' strategic behaviors while acknowledging the challenges of regulatory complexities and financial constraints.
Implications: The implications underscore the importance of proactive environmental management in navigating regulatory complexities and positioning firms for long-term success. This study contributes to advancing theoretical understanding and guiding managerial practice in fostering sustainable business practices and environmental stewardship within the corporate sector.
Novelty: This article lies in its holistic and multidisciplinary approach, introducing a new conceptual framework that provides practical guidance for policymakers and practitioners in promoting sustainable business practices.
Keywords
Article Details
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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- Barbarossa, C., & Pastore, A. (2015). Why environmentally conscious consumers do not purchase green products. Qualitative Market Research: An International Journal, 18(2), 188–209. https://doi.org/10.1108/QMR-06-2012-0030
- Calof, J., Arcos, R., & Sewdass, N. (2020). Competitive intelligence practices of European firms. In Corporate Foresight and Innovation Management (pp. 34–47). Routledge. https://doi.org/10.1080/09537325.2017.1337890
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- Dasinapa, M. B. (2023). Analyzing the Impact of Long-Term Financing on Cement Companies’ Profitability in Indonesia Stock Exchange. Advances in Management & Financial Reporting, 1(2 SE-Articles), 39–60. https://doi.org/10.60079/amfr.v1i2.117
- Falcone, P. M. (2014). Environmental Standards and Firms’ Competitiveness: A Theoretical Analysis. Theoretical Economics Letters, 4(1), 110–118. https://doi.org/10.4236/TEL.2014.41017
- Fanelli, R. M. (2021). Barriers to adopting new technologies within rural small and medium enterprises (SMEs). Social Sciences, 10(11), 430. https://doi.org/10.3390/SOCSCI10110430
- Ghobakhloo, M., Iranmanesh, M., Grybauskas, A., Vilkas, M., & Petraitė, M. (2021). Industry 4.0, innovation, and sustainable development: A systematic review and a roadmap to sustainable innovation. Business Strategy and the Environment, 30(8), 4237–4257. https://doi.org/10.1002/bse.2867
- Hou, B., Hong, J., Chen, Q., Shi, X., & Zhou, Y. (2019). Do academia-industry R&D collaborations necessarily facilitate industrial innovation in China? The role of technology transfer institutions. European Journal of Innovation Management, 22(5), 717–746. https://doi.org/10.1108/EJIM-09-2018-0195
- Kenç, T., Erdem, F. P., & Ünalmış, İ. (2016). Resilience of emerging market economies to global financial conditions. Central Bank Review, 16(1), 1–6. https://doi.org/https://doi.org/10.1016/j.cbrev.2016.03.002
- Kim, S. S., Pak, J., & Son, S. Y. (2023). Do calling-oriented employees take charge in organizations? The role of supervisor close monitoring, intrinsic motivation, and organizational commitment. Journal of Vocational Behavior, 140, 103812. https://doi.org/10.1016/j.jvb.2022.103812
- Lee, H.-K. (2014). Effects of authentic leadership on organizational commitment for employees. Journal of Digital Convergence, 12(5), 181–190. https://doi.org/10.14400/JDC.2014.12.5.181
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- Ludwig, P., & Sassen, R. (2022). Which internal corporate governance mechanisms drive corporate sustainability? Journal of Environmental Management, 301, 113780. https://doi.org/10.1016/J.JENVMAN.2021.113780
- Manginte, S. Y. (2024). Fortifying Transparency: Enhancing Corporate Governance through Robust Internal Control Mechanisms. Advances in Management & Financial Reporting, 2(2 SE-Articles), 72–84. https://doi.org/10.60079/amfr.v2i2.173
- Mendoza, J. P., Dekker, H. C., & Wielhouwer, J. L. (2016). Firms’ compliance with complex regulations. Law and Human Behavior, 40(6), 721. https://doi.org/10.2139/SSRN.2037769
- Moradi, E., Jafari, S. M., Doorbash, Z. M., & Mirzaei, A. (2021). Impact of organizational inertia on business model innovation, open innovation and corporate performance. Asia Pacific Management Review, 26(4), 171–179. https://doi.org/10.1016/J.APMRV.2021.01.003
- Nguyen, H. L., & Kanbach, D. K. (2024). Toward a view of integrating corporate sustainability into strategy: A systematic literature review. Corporate Social Responsibility and Environmental Management, 31(2), 962–976. https://doi.org/10.1002/csr.2611
- Nižetić, S., Djilali, N., Papadopoulos, A., & Rodrigues, J. J. P. C. (2019). Smart technologies for promotion of energy efficiency, utilization of sustainable resources and waste management. Journal of Cleaner Production, 231, 565–591. https://doi.org/https://doi.org/10.1016/j.jclepro.2019.04.397
- Nkemkiafu, A. G., Asah, N. P., & Felix, N. (2019). Strategic Process Innovation Practices On Customer Satisfaction And Market Share. Journal of Marketing Development & Competitiveness, 13(2). https://doi.org/10.33423/JMDC.V13I2.2008
- Pasla, B. N., Ayu, M. S., Fathiyah, F., Bailah, B., Rasid, F., & Ubaidillah, U. (2022). Leadership style types: The Importance of Organizational Culture and Change Management. Jurnal Prajaiswara, 3(2), 105–115. https://doi.org/10.55351/prajaiswara.v3i2.45
- Permata, I. (2023). Insights into Effective Corporate Financial Management Practices and Their Implications. Advances in Management & Financial Reporting, 1(3 SE-Articles), 129–144. https://doi.org/10.60079/amfr.v1i3.194
- Pham, H. N., Thai, N. T., Heffernan, T. W., & Reynolds, N. (2024). Environmental Policies and the Promotion of Pro-Environmental Consumer Behavior: A Systematic Literature Review. Journal of Macromarketing, 44(1), 30–58. https://doi.org/10.1177/02761467231201507
- Purwanti, D. (2023). The Strategic Imperative of Treasury and Financial Risk Management in a Volatile Economic Landscape. Advances in Management & Financial Reporting, 1(3 SE-Articles), 119–128. https://doi.org/10.60079/amfr.v1i3.224
- Ranjith, V. K. (2016). Business Models and Competitive Advantage. Procedia Economics and Finance, 37, 203–207. https://doi.org/https://doi.org/10.1016/S2212-5671(16)30114-9
- Roy, A., & Pal, A. M. (2017). Corporate governance compliance, governance structures, and firm performance. Governance Structures, and Firm Performance (June 16, 2017). https://doi.org/10.2139/SSRN.2988073
- Roy, R. (2018). Consumer product design: Patterns of innovation, market success and sustainability. Journal of International Business Research and Marketing, 3(5), 25–33. https://doi.org/10.18775/JIBRM.1849-8558.2015.35.3004
- Shoeb, M., Aslam, A., & Aslam, A. (2022). Environmental accounting disclosure practices: A bibliometric and systematic review. International Journal of Energy Economics and Policy, 12(4), 226–239. https://doi.org/10.32479/ijeep.13085
- Stevanović, A. G. (2017). Organizational culture and climate as the requirements of innovation in organizations. Škola Biznisa, 2, 107–120. https://doi.org/10.5937/SKOLBIZ2-14066
- Swink, M., & Schoenherr, T. (2015). The effects of cross‐functional integration on profitability, process efficiency, and asset productivity. Journal of Business Logistics, 36(1), 69–87. https://doi.org/10.1111/jbl.12070
- Syahrani, N. A., Amiruddin, Saleh, M., & Razak, R. (2013). Pengaruh Kompetensi, Independensi, Dan Time Budget Pressure Terhadap Kualitas Audit. Jurnal Ilmu Ekonomi, 6(1), 13–26.
- Walling, E., & Vaneeckhaute, C. (2020). Developing successful environmental decision support systems: Challenges and best practices. Journal of Environmental Management, 264, 110513. https://doi.org/10.1016/J.JENVMAN.2020.110513
- Zhao, H. (2018). Executive labor market segmentation: How local market density affects incentives and performance. Journal of Corporate Finance, 50, 1–21. https://doi.org/10.2139/SSRN.2593234
- Zhao, S., Teng, L., & Ji, J. (2024). Impact of environmental regulations on eco-innovation: the moderating role of top managers’ environmental awareness and commitment. Journal of Environmental Planning and Management, 67(10), 2229–2256.
References
Abd Aziz, N. H., Latif, A. R. A., Osman, M. N. H., & Alshdaifat, S. (2023). ESG And Corporate Governance: Systematic. https://doi.org/10.35631/aijbes.518018
Aldieri, L., Carlucci, F., Vinci, C. P., & Yigitcanlar, T. (2019). Environmental innovation, knowledge spillovers and policy implications: A systematic review of the economic effects literature. Journal of Cleaner Production, 239, 118051. https://doi.org/https://doi.org/10.1016/j.jclepro.2019.118051
Allee, K. D., Baik, B., Han, S.-Y., & Kim, B. H. (2019). Trust and Disclosure Transparency in Financial Reporting of Government Agencies. Available at SSRN 3444477. https://doi.org/10.2139/SSRN.3444477
Almada, L., & Borges, R. (2018). Sustainable competitive advantage needs green human resource practices: A framework for environmental management. Revista de Administração Contemporânea, 22(3), 424–442. https://doi.org/10.1590/1982-7849RAC2018170345
Bansal, S., Garg, I., & Yadav, A. (2022). Do firms with environmental concerns give better performance: A systematic literature review. Journal of Public Affairs, 22(1), e2322. https://doi.org/10.1002/pa.2322
Barbarossa, C., & Pastore, A. (2015). Why environmentally conscious consumers do not purchase green products. Qualitative Market Research: An International Journal, 18(2), 188–209. https://doi.org/10.1108/QMR-06-2012-0030
Calof, J., Arcos, R., & Sewdass, N. (2020). Competitive intelligence practices of European firms. In Corporate Foresight and Innovation Management (pp. 34–47). Routledge. https://doi.org/10.1080/09537325.2017.1337890
Chin, T. L., Yean, T. F., & Leow, H.-W. (2023). Ability, motivation, opportunity-enhancing HRM practices and corporate environmental citizenship: Revisiting the moderating role of organisational learning capability in Malaysian construction companies. International Journal of Business and Society, 24(1), 100–118. https://doi.org/10.33736/ijbs.5607.2023
da Silva, A. W. L., Netto, M., Selig, P. M., & de Ávila Lerípio, A. (2019). A framework for governance of sustainability indicator systems in strategic environmental assessment processes. Journal of Environmental Assessment Policy and Management, 21(01), 1950007. https://doi.org/10.1142/S1464333219500078
Dasinapa, M. B. (2023). Analyzing the Impact of Long-Term Financing on Cement Companies’ Profitability in Indonesia Stock Exchange. Advances in Management & Financial Reporting, 1(2 SE-Articles), 39–60. https://doi.org/10.60079/amfr.v1i2.117
Falcone, P. M. (2014). Environmental Standards and Firms’ Competitiveness: A Theoretical Analysis. Theoretical Economics Letters, 4(1), 110–118. https://doi.org/10.4236/TEL.2014.41017
Fanelli, R. M. (2021). Barriers to adopting new technologies within rural small and medium enterprises (SMEs). Social Sciences, 10(11), 430. https://doi.org/10.3390/SOCSCI10110430
Ghobakhloo, M., Iranmanesh, M., Grybauskas, A., Vilkas, M., & Petraitė, M. (2021). Industry 4.0, innovation, and sustainable development: A systematic review and a roadmap to sustainable innovation. Business Strategy and the Environment, 30(8), 4237–4257. https://doi.org/10.1002/bse.2867
Hou, B., Hong, J., Chen, Q., Shi, X., & Zhou, Y. (2019). Do academia-industry R&D collaborations necessarily facilitate industrial innovation in China? The role of technology transfer institutions. European Journal of Innovation Management, 22(5), 717–746. https://doi.org/10.1108/EJIM-09-2018-0195
Kenç, T., Erdem, F. P., & Ünalmış, İ. (2016). Resilience of emerging market economies to global financial conditions. Central Bank Review, 16(1), 1–6. https://doi.org/https://doi.org/10.1016/j.cbrev.2016.03.002
Kim, S. S., Pak, J., & Son, S. Y. (2023). Do calling-oriented employees take charge in organizations? The role of supervisor close monitoring, intrinsic motivation, and organizational commitment. Journal of Vocational Behavior, 140, 103812. https://doi.org/10.1016/j.jvb.2022.103812
Lee, H.-K. (2014). Effects of authentic leadership on organizational commitment for employees. Journal of Digital Convergence, 12(5), 181–190. https://doi.org/10.14400/JDC.2014.12.5.181
Lemos, F. (2020). Emerging Market Multinational Companies (EMNCs): Challenges and Opportunities. SciELO Brasil. https://doi.org/10.1590/S0034-759020200307
Lu, H., Shin, J.-E., & Zhang, M. (2023). Financial reporting and disclosure practices in China. Journal of Accounting and Economics, 76(1), 101598. https://doi.org/10.1016/j.jacceco.2023.101598
Ludwig, P., & Sassen, R. (2022). Which internal corporate governance mechanisms drive corporate sustainability? Journal of Environmental Management, 301, 113780. https://doi.org/10.1016/J.JENVMAN.2021.113780
Manginte, S. Y. (2024). Fortifying Transparency: Enhancing Corporate Governance through Robust Internal Control Mechanisms. Advances in Management & Financial Reporting, 2(2 SE-Articles), 72–84. https://doi.org/10.60079/amfr.v2i2.173
Mendoza, J. P., Dekker, H. C., & Wielhouwer, J. L. (2016). Firms’ compliance with complex regulations. Law and Human Behavior, 40(6), 721. https://doi.org/10.2139/SSRN.2037769
Moradi, E., Jafari, S. M., Doorbash, Z. M., & Mirzaei, A. (2021). Impact of organizational inertia on business model innovation, open innovation and corporate performance. Asia Pacific Management Review, 26(4), 171–179. https://doi.org/10.1016/J.APMRV.2021.01.003
Nguyen, H. L., & Kanbach, D. K. (2024). Toward a view of integrating corporate sustainability into strategy: A systematic literature review. Corporate Social Responsibility and Environmental Management, 31(2), 962–976. https://doi.org/10.1002/csr.2611
Nižetić, S., Djilali, N., Papadopoulos, A., & Rodrigues, J. J. P. C. (2019). Smart technologies for promotion of energy efficiency, utilization of sustainable resources and waste management. Journal of Cleaner Production, 231, 565–591. https://doi.org/https://doi.org/10.1016/j.jclepro.2019.04.397
Nkemkiafu, A. G., Asah, N. P., & Felix, N. (2019). Strategic Process Innovation Practices On Customer Satisfaction And Market Share. Journal of Marketing Development & Competitiveness, 13(2). https://doi.org/10.33423/JMDC.V13I2.2008
Pasla, B. N., Ayu, M. S., Fathiyah, F., Bailah, B., Rasid, F., & Ubaidillah, U. (2022). Leadership style types: The Importance of Organizational Culture and Change Management. Jurnal Prajaiswara, 3(2), 105–115. https://doi.org/10.55351/prajaiswara.v3i2.45
Permata, I. (2023). Insights into Effective Corporate Financial Management Practices and Their Implications. Advances in Management & Financial Reporting, 1(3 SE-Articles), 129–144. https://doi.org/10.60079/amfr.v1i3.194
Pham, H. N., Thai, N. T., Heffernan, T. W., & Reynolds, N. (2024). Environmental Policies and the Promotion of Pro-Environmental Consumer Behavior: A Systematic Literature Review. Journal of Macromarketing, 44(1), 30–58. https://doi.org/10.1177/02761467231201507
Purwanti, D. (2023). The Strategic Imperative of Treasury and Financial Risk Management in a Volatile Economic Landscape. Advances in Management & Financial Reporting, 1(3 SE-Articles), 119–128. https://doi.org/10.60079/amfr.v1i3.224
Ranjith, V. K. (2016). Business Models and Competitive Advantage. Procedia Economics and Finance, 37, 203–207. https://doi.org/https://doi.org/10.1016/S2212-5671(16)30114-9
Roy, A., & Pal, A. M. (2017). Corporate governance compliance, governance structures, and firm performance. Governance Structures, and Firm Performance (June 16, 2017). https://doi.org/10.2139/SSRN.2988073
Roy, R. (2018). Consumer product design: Patterns of innovation, market success and sustainability. Journal of International Business Research and Marketing, 3(5), 25–33. https://doi.org/10.18775/JIBRM.1849-8558.2015.35.3004
Shoeb, M., Aslam, A., & Aslam, A. (2022). Environmental accounting disclosure practices: A bibliometric and systematic review. International Journal of Energy Economics and Policy, 12(4), 226–239. https://doi.org/10.32479/ijeep.13085
Stevanović, A. G. (2017). Organizational culture and climate as the requirements of innovation in organizations. Škola Biznisa, 2, 107–120. https://doi.org/10.5937/SKOLBIZ2-14066
Swink, M., & Schoenherr, T. (2015). The effects of cross‐functional integration on profitability, process efficiency, and asset productivity. Journal of Business Logistics, 36(1), 69–87. https://doi.org/10.1111/jbl.12070
Syahrani, N. A., Amiruddin, Saleh, M., & Razak, R. (2013). Pengaruh Kompetensi, Independensi, Dan Time Budget Pressure Terhadap Kualitas Audit. Jurnal Ilmu Ekonomi, 6(1), 13–26.
Walling, E., & Vaneeckhaute, C. (2020). Developing successful environmental decision support systems: Challenges and best practices. Journal of Environmental Management, 264, 110513. https://doi.org/10.1016/J.JENVMAN.2020.110513
Zhao, H. (2018). Executive labor market segmentation: How local market density affects incentives and performance. Journal of Corporate Finance, 50, 1–21. https://doi.org/10.2139/SSRN.2593234
Zhao, S., Teng, L., & Ji, J. (2024). Impact of environmental regulations on eco-innovation: the moderating role of top managers’ environmental awareness and commitment. Journal of Environmental Planning and Management, 67(10), 2229–2256.