Going beyond environmental regulations—The influence of firm size on the effect of green practices on corporate financial performance

Yusof, Nor'Aini, Tabassi, Amin Akhavan and Esa, Muneera (2019) Going beyond environmental regulations—The influence of firm size on the effect of green practices on corporate financial performance. Corporate Social Responsibility and Environmental Management, 27 (1). pp. 32-42. ISSN 1535-3958

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Abstract

Despite the various environmental regulations to address the negative effect of construction activities on the environment, the construction sector is still slow to implement green practices (GPs). To encourage construction firms to implement GPs, these firms should be convinced that GPs are a financially viable endeavour. This paper aimed to analyse the influence of GPs on corporate financial performance (CFP) and investigate whether firm size influences that effect. A survey was employed to gather information from Malaysian construction firms, and the data were analysed using partial least squares structural equation modelling. The findings indicate that green supplier management, green subcontractor management, and green project management have significant effects on CFP and that large firms with high levels of green business practices and green project management attained higher CFP than small and medium enterprises. Policymakers and managers should take a flexible approach to boost GPs in the construction industry.