Abstract

http://ssrn.com/abstract=1513862
 
 

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On the Implementation of a 'Global' Environmental Strategy: The Role of Absorptive Capacity


Jonatan Pinkse


Grenoble Ecole de Management

Matthias Kuss


affiliation not provided to SSRN

Volker H. Hoffmann


ETH Zürich

November 26, 2009

International Business Review, Spring 2010

Abstract:     
This paper sheds light on factors influencing to what extent MNCs are able to implement a global environmental strategy. We apply the concept of absorptive capacity to analyze what role the uptake and integration of external knowledge playsin implementing an environmental strategy and propose to make a distinction between shared and unit-specific levels of absorptive capacity. Based on an in-depth investigation of the multinational chemical company BASF, we derive three propositions about the influence of absorptive capacity on the implementation of global environmental practices on the regional headquarters and subsidiary level. The main finding is that a shared level of absorptive capacity across subsidiaries facilitates a common understanding and use of environment-related knowledge, but, asenvironment-related knowledge often applies to a specific context only, there is also a need to build unit-specific absorptive capacity on a subsidiary level. By allowing subsidiaries to build their absorptive capacity, MNCs can more efficiently adapt global environmental practices and lower the cost of implementing a globalenvironmental standard.

Number of Pages in PDF File: 52

Keywords: Sustainable development, environmental management, absorptive capacity, knowledge sharing, headquarters-subsidiary relationship

JEL Classification: F23, L65, M14, O31, O32

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Date posted: November 27, 2009  

Suggested Citation

Pinkse, Jonatan and Kuss, Matthias and Hoffmann, Volker H., On the Implementation of a 'Global' Environmental Strategy: The Role of Absorptive Capacity (November 26, 2009). International Business Review, Spring 2010. Available at SSRN: http://ssrn.com/abstract=1513862

Contact Information

Jonatan Pinkse (Contact Author)
Grenoble Ecole de Management ( email )
Grenoble Cedex, 38003
France
Matthias Kuss
affiliation not provided to SSRN ( email )
Volker H. Hoffmann
Swiss Federal Institute of Technology Zurich ( email )
Zürichbergstrasse 18
8092 Zurich, CH-1015
Switzerland
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