Multinationals Going Green: A Literature Review and Methodology

MULTINATIONALS GOING GREEN
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Literature review
With the continuous concern with regards to environmental challenges, global
warming and increased levels of pollution, it deemed necessary for multinational
cooperations (MNC) to enhance there business operations and attempt to “green” their
activities. This is due to the fact MNC’s are usually the large in size, and the impact they
have on the society (Mousiolis, Zardis, Karaminis and Rontongianni, 2015). Moreover, it was
evident that the there are a lot of negative impacts of MNC’s on emerging economies due to a
number of reasons. For instance, with loose environmental policies emerging economies,
MNC’s can find it very easy to expand their operations without consideration of the effects
that this might have on the resources that they might exploit or the pollution that might result.
Another reason for MNC’s to adhere to greening activities is to decrease costs and increase
returns on investment. Moreover, with the internet and increased accessibility to the media,
reputations of firms can easily be affected by their actions. With all of this in mind, greening
operations and environmental considerations are now a main piece of the puzzle to strategic
business plans (Kolk, Kourula, and Pisani, n.d)
The attempts to green operations are usually categorized under the Corporate Social
Responsibility of an entity, which is a firm’s strategy to mitigate the impacts of its activities
on the surrounding environment and community (reference). There are various dimensions
through which an MNC can affect the surroundings, consequentially, efforts to mitigate risks
are usually directed towards for main areas: workplace, community, environment, and
marketplace. These efforts can take different forms and can be applied at different degrees
depending on different factors. The participants in all of these dimensions are called
“stakeholders”, as they are either directly on indirectly affected by the activities of the MNC.
On the other hand, stakeholders can also ffect the activities of the MNC through either
limiting the access to resources or its activities (Yang and Rivers, 2009). There are various
antecedents from a stakeholders point of view that drives a firm to adapt green practices.
The first set of antecedents are directly affected by the social context. First,
environmental awareness and its applications are the first main drivers of green practices.
Both internal awareness and external awareness of environmental and social issues can affect
the degree to which am MNC applies green operations (Heru and W.Lo, 2016). Governments
and international institutions usually formulate policies and regulations due to certain public

concerns (Heru and W.Lo, 2016). Consequentially, the degree to which public citizens and
employees of an organization are knowledgeable about emerging issues would drive the
policies, codes and regulations of an MNC. For instance, consumers of a certain product or
service can refuse to invest in a non-green MNC and buy from a competitor instead. This
would affect the revenue of an MNC and would therefore result in a loss if the MNC does not
adhere to wants of customers. Employees of an organization can also exert power on a firm to
change its policies (Yang and Rivers, 2009). A good example is the attraction of new talents
and prospective employees. Employers might find themselves at dire, if their reputation
within the society does not imply that they comprehend with green operations and activities
as this might push prospective employees to apply to other firms and entities. Another set of
influencers are the shareholders of an entity. With the increased environmental awareness and
the concept of “Socially Responsible Investment”, the power of shareholders can affect the
degree to which MNC’s operate (Yang and Rivers, 2009). Investors are now not only
concerned about the return on investments they make, but also on the behavior of firms both
internally and externally.
Another set of antecedents are related to the organizational characteristics of a firm.
First, the relative distance between and MNC and its parent company, plays an important role
in greening operations. When expanding in a foreign context, conflicts can arise between a
firm’s parent company and its subsidiary (Yang and Rivers, 2009). Those conflicts can arise
from the difference of degrees of regulations and policies. For instance, in developed
countries, regulations and policies are stricter than those of emerging economies which might
create a number of conflicts between the two entities. In this example the parent country is
leading on environmental issues and the host country is lagging behind which can considered
as a competitive advantage, where an MNC pioneer the CSR movement and bring added
benefits to the unit (Heru and W.Lo, 2016). However, if the host country is leading in
environmental issues and the parent country is not, this is where conflicts start to arise. In this
case, an MNC will find it very difficult to adapt and might eventually lose the subsidiary.
Therefore, governing bodies, both national and international, can also affect the degree to a
company applies green practices and processes. Formal institutions can regulate the extent to
which businesses can induce impacts on resources, environment and society through policies
and regulations. They can either provide incentives for MNC’s for adhering to environmental
sound policies or they might penalize them for not doing so. The commitment of greening
operations and adapting sound environmental and social strategies have increased over the

years due to the legislative efforts by national and international institutions (Yang and Rivers,
2009).
Lastly, another set of antecedents in MNC’s that can affect the degree of green
operations are industrial and market pressure antecedents. According to Heru and W.Lo
(2016), one of the main drivers to push greening in firms is the industrial antecedents, where
the whole supply chain is affected by the act of greening. For instance, if a manufacturer is
adapting to green policies and regulations this will push its suppliers to adapt to in order to
ensure that their source of income does not move to other competitive suppliers who are
adhering to green operations and activities. Such practices can also lead to innovations within
the industry in order to achieve sustainable practices (Cheng, 2015). For instance, due to the
regulations, policies, public opinions and shifts in activities, there is a rapid increase in
emerging green technologies in many industries. This intense advancement in technologies
required a huge amount of investment in innovation and research and development units in
many MNCs.
Methodology
Research Objectives
The following dissertation has been designed to assess the influence of the green
policies and practices being followed in an organization on green job behaviors. The
following research study has been revolving around three research terms such as organization
green policies, organizational green practices, and green job behavior. The initial objective of
the research study is to evaluate the influence of green practices of companies impacting the
organizational green policies. The second objectives of the research study the influence of the
organization green policies on green job behavior. The last objective of the research study
focuses on studying the impact of company green policies on green job performance.
Research Design
The current research quantitative research methodology follows the survey
methodology. The questionnaire has been designed which is distributed among the