Corporate Environmental Management: Individual‐Level Drivers and the Moderating Role of Charismatic Leadership

• DOI: http://doi.org/10.1111/emre.12134
• Published date: 01 December 2018
• Date: 01 December 2018

Corporate Environmental Management:

Individual-Level Drivers and the Moderating

Role of Charismatic Leadership

GIORGOS PAPAGIANNAKIS and SPYROS LIOUKAS

Department of Management Science and Technology, Athens University of Economics and Business, Athens, Greece

Drawing upon norm-activation and social cognitive theories, we examine whether the personal norms and self-

efficacy of top managers affect their decisions to engage in environmental management initiatives (EMI). We also

investigate whether this relationship is moderated by CEO charisma. Empirical evidence from a sample of 125

companies indicates that significantvariation in EMI is explained by the two activatorsof personal norms –namely,

awareness of consequences and ascription of responsibility –as well as self-efficacy with respect to environmental

decisions. Furthermore, the effects of managers’personal norms on EMI engagement are more intense when

charismatic leadership is present. The results offer insights into the microfoundations of proactive environmental

management and their interplay with charismatic leadership. Managerial implications for firms seeking to advance

their environmental conduct are discussed.

Keywords: environmental management; decision making; personal norms; awareness; responsibility; self-efficacy;

charismatic leadership; Corporate Social Responsibility; environmental sustainability

Introduction

There is currentlya growing consensus among academics

and practitioners that corporate environmental

management yields a double dividend, with positive

effects on both the natural environment and business

performance (e.g. Chang, 2011; Ferrón and Darnall,

2014). An increasing number of companies are engaging

in a variety of environmental management initiatives

(EMI). Indicatively, the number of ISO 14001-certified

facilities has increased from 188,574 in 2008 to 319,324

in 2015 (ISO, 2016). Along with this trend, an expanding

research stream has paid significant attention to the

antecedentsof EMI engagement. This streamhas centered

largely on macro and industry-level drivers of corporate

environmental activities. For example, early work argues

that the general competitive environment influences the

environmental orientation of businesses (Aragón-Correa

and Sharma, 2003). Subsequent research has focused on

specificforces that may influence the way businessesform

their environmental posture. Environmental regulation,

for example, has been showed to drive the adoption of

various environmental initiatives (Banerjee et al., 2003;

Ervin et al., 2013). Other studies demonstrate that

coercive and normative pressures stemming from

stakeholders such as customers, investors, local

communities, and environmental activists may affect the

adoption of EMI (Delmas and Toffel, 2008; Ervin et al.,

2013). Also, the industry-specific characteristics have

been found to have both direct and indirect effects on

the way firms perceive environmental issues and adopt

green managementpractices (Banerjee et al., 2003; Lucas

and Noordewier, 2016).

However, as Delmas and Toffel (2004) argue,

institutional and macro-level perspectives cannot explain

why firms that aresubject to the same level of institutional

pressures follow different environmental management

strategies.Scholars have recentlyargued that investigation

at the individual levelwould allow us to better understand

behavioral drivers that inform the environmental decision

making of key players and explain subsequent

organizational outcomes (Lo et al., 2012; Papagiannakis

et al., 2014). Despite their importance, little is known

about the micro-level factors, such as those referring to

managers’behavioral traits and perceptions, that may

influence the extent to which firms engage in

environmental initiatives (Aguinis and Glavas, 2012).

Correspondence: Giorgos Papagiannakis, Athens University of

Economics and Business, Department of Management Science and

Technology,Patission 76, Athens 10434,Greece, Tel: +30 210 8203563;

Fax: +30 210 8203579. E-mail gpapagian@aueb.gr

European Management Review, Vol. 15, 475–489, (2018)

DOI: 10.1111/emre.12134

©2017 European Academy of Management