An Empirical Study of ISO 14001 Certification and Firm Environmental Performance

Introduction

Currently, enterprises are in the transition period of China's new economy. Under the dual influence of international policies and public opinion, the requirements for the sustainable development and green performance of enterprises are increasing. Using a green development approach in accordance with such international policies will not only help enterprises avoid penalties from the environmental supervision department but also gain these enterprises a series of benefits. Therefore, Chinese enterprises have incorporated the certification of environmental standards such as ISO14001 into their strategies.

In 2017, the total number of global ISO14001 certifications was 319,496, and Asia accounted for 55.7% of these. China ranks first in the world in terms of the total number of ISO14001 certifications, accounting for 36% of the world’s total certification. From an industry analysis, it can be seen that ISO-certified companies are basically concentrated in industrial enterprises, and the number of construction industry certifications is at the top.

While the number of ISO14001 certifications by Chinese enterprises is very large, it is still necessary to carefully think about whether environmental performance is actually improved. Although countries in places such as Europe and the Americas have a smaller number of ISO14001 certifications, they have implemented a more stringent environmental standard, namely, EMAS. Compared with ISO14001, EMAS is more concerned with environmental performance, and there are more environmental factors involved. In addition, EMAS sets up specific environmental parameters, while ISO14001 only theoretically gives requirements for environmental standards management systems. To address such defects in ISO14001 (2004), the 2014 ISO/TC officially formulated the “Environmental Management System Requirements and Instructions For Use” as a revision of ISO14001. The new standard puts forward new ideas for strategic environmental management and formalizes the requirements for environmental performance into various provisions, such as 4.4 (Environmental Management System) and 9.1.1 (Monitor, Measurement, Analysis and Evaluation).

In recent years, many scholars have studied the influence of ISO14001 certification on a number of aspects of a company. For instance, Lu Jun and Jiao Shuyan (2011) studied the connection between the paper-making industry and the environmental information disclosure of the construction industry and the connection between environmental performance and financial performance. Yang Dongning and Zhou Changhui (2005) studied enterprises' driving force model for ISO14001 voluntary certification and discussed and analyzed interior driving forces such as the environment orientation of management and external driving forces such as coercive force. Miao Shuyi and other scholars (2014) mainly focused on the important role that ISO14001 certification plays for environmental supervision departments.