The Dynamic of Corporate Self-Regulation: ISO 14001, Environmental Commitment, and Organizational Citizenship Behavior

The Dynamic of Corporate Self-Regulation: ISO14001, Environmental Commitment, andOrganizational Citizenship Behavior

Oren PerezYair Amichai-HamburgerTammy Shterental

This article examines the institutional impact of environmental managementsystems (EMSs), focusing on ISO 14001. It develops a pluralistic frameworkfor thinking about the dynamic of corporate self-regulation that we term thepolyphonic model. It argues that the adoption of ISO 14001 can move thefirm into a new equilibrium trajectory, which enmeshes together environ-mental and economic goals and reflects greater sensitivity to ecological con-cerns. There is a positive reciprocal cycle between the pro-environmentalstructural changes induced by ISO 14001 and the employees’ attitudes towardthe firm and the environment. In order to examine ISO 14001 institutionalimpact, we conducted a series of interviews with managers and administeredquestionnaires to employees in 24 Israeli firms with and without certification.The findings indicate that the perceived environmental commitment of cer-tified firms was higher than that of noncertified firms and was higher amongemployees that perceived the EMS as more highly integrated in the firm.Perceptions of the standard’s integration were also found to be positivelycorrelated with personal environmental commitment. The results also indi-cate that the increase in the firm’s environmental commitment was positivelyassociated with employees’ organizational citizenship behavior within certifiedfirms. Further indications of the pro-environmental dynamic induced by ISO14001 were found in the in-depth interviews.

Over the last years, the environmental regulation system hasundergone radical changes. Various private normative schemesplay an increasingly important role in this new regulatory sphere.One of the main questions raised by this process is whether, and towhat extent, private regulatory arrangements can replace publicregulation. The question of the efficacy of private regulatory

Law & Society Review, Volume 43, Number 3 (2009)r 2009 Law and Society Association. All rights reserved.

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This research was supported by the Chief Scientist of the Israeli Ministry of Environ-ment. We would like to thank Gideon Parchomovsky, Ben Richardson, and Stepan Woodfor their helpful comments on an earlier draft of this article and three anonymous re-viewers. We are thankful to Haya Greenwald and Shiri Ramon for research assistance. JoelWeill, former VP Quality and Special Projects at Ormat, and Dr. Nitzan Eyal of the Stan-dards Institution of Israel provided us with valuable information regarding auditing prac-tices in Israel. Please address correspondence to Oren Perez, Faculty of Law, Bar IlanUniversity, Ramat Gan 52900, Israel; e-mail: [email protected].

i:/BWUS/LSR/383/[email protected]

schemes reflects a broader dilemma concerning the circumstancesunder which firms will take environmental actions that go beyondwhat is prescribed by law. This article explores this question, fo-cusing on the ISO 14001 environmental management system(EMS), which is the most common voluntary environmental stan-dard in the world (ISO 2008:10), serving also as the EMS of the EUeco-management and audit scheme (EMAS).1

In exploring the puzzle of the efficacy of EMSs, we draw on anew model of the firm that we term the polyphonic model. Ac-cording to this model, which is inspired by the writings of Luhm-ann and Nelson, firms and other organizations are depicted asdynamic, self-organized decision-processing systems, which can ac-commodate multiple logics and cultural themes. We argue that thismodel provides a coherent framework for thinking about the wayin which different logics intertwine in the context of the moderncorporation.

Drawing on this theoretical construction, the article seeks to ad-vance the empirical understanding of the dynamic of corporate self-regulation. Generally, we argue that the adoption of ISO 14001 canmove the firm into a new equilibrium trajectory, which enmeshestogether environmental and economic goals, reflecting greater eco-logical sensitivity. The certification process is likely to trigger a vir-tuous cycle between the firm’s new structure and the employees’attitudesFtoward the environment and the organization.

The article reports the result of our study of the impact ofISO 14001 on the internal dynamic and environmental commit-ment of Israeli firms. As part of our study we conducted a series ofinterviews with executives and administered questionnaires toemployees in 24 Israeli firms with and without ISO 14001 certi-fication. Drawing on qualitative and quantitative analysis, weexamined to what extent the adoption of ISO 14001 has affectedthe attitudes and beliefs of the workers of certified firms byconsidering the standard’s impact on their perceptions of the or-ganization’s environmental commitment, their personal environ-mental commitment, and their organizational citizenship behavior.The results of our study lend support to our thesis regarding thepro-environmental dynamic associated with the adoption of ISO14001.

ISO 14001 was released in 1996, and a revised version waspublished in 2004.2 The ISO 14001 EMS is based on the concept ofcontinual improvement expressed in the ‘‘Plan-Do-Check-Act’’methodology. According to this methodology, the organization

1 See http://ec.europa.eu/environment/emas/index_en.htm. ISO 14001 also domi-nates the Israeli market.

2 See ISO 14001 (2004) and ISO 14004 (2004).

594 The Dynamic of Corporate Self-Regulation

should formulate an environmental policy with general environ-mental goals, design the mechanisms and procedures by which itwill achieve these goals (including, for example, designation of re-sponsibilities and training), use monitoring and documenting sys-tems to assess performance against its designated goals, and takeaction to improve the environmental system’s performance. Thestandard gives the organization the freedom to choose between self-certification and third-party certification and evaluation. Externalcertification is provided by accredited EMS registration bodies (whichalso provide follow-up auditing services). In Israel, most certifiedorganizations choose third-party certification and evaluation, com-monly performed by the Standards Institution of Israel (SII).

Conceptualizing the Firm: The Polyphonic Organization

Examination of the environmental and organizational effect ofEMSs such as ISO 14001 requires consideration of three key ques-tions. First, what are the factors that cause firms to adopt an EMS?Second, how does the adoption of an EMS affect the internalstructure and dynamic of certified organizations and the attitudesand beliefs of the individuals working in them? Finally, what effectdo these systems have on the environmental performance of theorganizations that adopt them, and what are the organizationalmechanisms that generate these effects?

In addressing these questions we draw on an institutional con-ception of the firm that we term the polyphonic model.3 Thepolyphonic model conceptualizes the firm as a complex social sys-tem that cannot be described by means of a single and temporallystable narrative (e.g., profit maximization).4 According to the poly-phonic model, firms and other organizations are depicted as dy-namic, self-organized decision-processing systems, which canaccommodate multiple logics. The calculative logic of profit max-imization, while important, constitutes only one of these co-occur-ring logics. By postulating the firm as a pluralistic entity, thepolyphonic model seeks to respond to the puzzle posed by Marchand Olsen regarding the way in which the logics of ‘‘consequences’’and ‘‘appropriateness’’ interact in different institutional contexts(Goldmann 2005:43; March & Olsen 2004:19).

The polyphonic model draws on two main theoretical pillars:Luhmann’s communication-based theory of social systems (Luhmann

3 This term was used by other authors, see, e.g., Hazen (1993) and Andersen (2003).While we share with these writers the conception of the firm as a complex web of dis-courses, our model takes this argument further by developing a detailed description of thefirm’s internal dynamic.

4 See, e.g., Friedman (1970); Nelson (1991:64).

Perez, Amichai-Hamburger, & Shterental 595

1995, 2000) and Nelson’s concept of ‘‘social technologies’’ (Nelson &Sampat 2001; Nelson 1991). In Luhmann’s framework, organiza-tions are conceptualized as self-organized systems of communica-tions5 of a special form: decisions; organizations are constituted by arecursive network of decisional communications (Bakken & Hernes2008).

The organization’s structure consists of various decisionpremises or programs (Luhmann) or social technologies (Nelson),which constitute necessary preconditions for making a decision.Luhmann distinguishes between several types of programs (Mar-tens 2006:89–94; Seidl & Becker 2006:24–9). First, there are de-cision programs, which in turn include goal-selection programs,execution/conditional programs (that determine what to do undervaried conditions), and cognitive programs (which are responsiblefor the generation and ordering of information). Second, thereare personnel programs, which determine how new employeesare selected and assigned to different posts. Finally, there arestructural programs that determine the organization’s hierarchyand meta-structural programs that deal with the meta-questions ofa possible redesign of any of the foregoing decision premises.These various programs may invoke diverse logics and criteria asantecedents for reaching a decision.

Nelson adopts a similar conceptual vocabulary in his analysis oforganizations, highlighting the role of routines in the firm’s struc-ture. Nelson characterizes firms in terms of a synthesis betweenstrategy, structure, and core-capabilities. Strategy ‘‘connotes a set ofbroad commitments made by a firm that define and rationalize itsobjectives and how it intends to pursue them’’ (Nelson 1991:67).The structure and core-capabilities of a firm are defined in terms oforganizational routines and decision procedures. Routines guidethe behavior of the agents using them, forming what Nelson de-fines as ‘‘social technology’’ (Nelson & Sampat 2001:42–7).6 Thecollection of decision premises or social technologiesFboth formaland informalFassociated with a certain organization constitutes itsunique structure or culture.

Like Luhmann, Nelson adopts a pluralistic vision of the firm,recognizing that the firm’s goals and routines may be associatedwith a multiplicity of logics. Nelson argues in that spirit that thefirm’s strategy may be a product of faith and company traditionand not just calculation. Further, there is no reason to argue a

5 Communication is conceptualized as the synthesis of three elements: information,utterance, and understanding, each forming an independent selection or distinction(Luhmann 1992).

6 Routine involves ‘‘a collection of procedures which, taken together, result in a pre-dictable and specifiable outcome’’ (Nelson & Sampat 2001:42). See further Pelikan(2003:243).


priori that the firm’s strategy will be in fact ‘‘optimal or even notself destructive’’ (Nelson 1991:67).7

The concept of polyphonic organization also sheds light onthe dynamic of organizational life and the causes of institutionalinnovation. The polyphonic model is based on the idea of a viabledynamic equilibrium. It is viable in the sense that while it is hypoth-esized that firms can host a variety of rationalities, only a limitedcombination of goals and routines offers a viable trajectory for thefirm given the external constraints it is facing. Firms can be viable,however, without being economic optimizers. The notion of equi-librium reflects the claim that organizations have a more-or-lessstable structure. Finally, the term dynamic reflects several featuresof the polyphonic organization; first, the idea that firms are net-work of decisionsFthey are not static solutions to discrete optimi-zation dilemmas. Second, it emphasizes the idea that the firm’sstructure is potentially alterable and is subject to continuous inter-nal contestation.

A further critical element of the dynamic of organizational lifelies in the reciprocal interaction between the firm’s structure andthe attitudes and beliefs of the employees. This relationship can bemutually supportive but also destructive. Luhmann makes a cleardistinction in this context between the organization and the humanagents associated with it. The organization is depicted as an au-tonomous social entity that interacts with the employees’ commu-nity in a reciprocal process of structural coupling. In analyzing thisreciprocal process, the polyphonic model adopts a pluralistic con-ception of the self: Human beings are assumed to act on the basis ofa wide range of motivations that cannot be explained in narrowmaterialistic terms or through the notion of self-interest (Frey &Stutzer 2006; Rocha & Ghoshal 2006).

Institutional Change and Organizational CitizenshipBehavior: ISO 14001 as a Transformative Agent andEquilibrium Anchor

The polyphonic model provides a complex framework forthinking about the causes for certification, the structural impact ofISO 14001, and ISO 14001 environmental efficacy. The poly-phonic model argues that the organizational processes underlyingthese decisions are not governed by a single logic (economic, en-vironmental, or other) but by a multiplicity of logics, whose exactconstellation is context-dependent. Drawing on this general frame-work, we argue that the adoption of ISO 14001 can move the firm

7 See further on that possibility Jensen (2002:252).


into a new equilibrium trajectory, which enmeshes together envi-ronmental and economic goals and reflects greater organizationalsensitivity to ecological concerns.

Regarding the certification process, the polyphonic modelmaintains that this process can reflect a wide spectrum of motiva-tions, both instrumental and ideological. Thus, while the poly-phonic model recognizes that firms are likely to engage in somesort of cost-benefit calculus regarding the decision whether to im-plement ISO 14001, balancing, for example, the cost of certifica-tion against potential reputational gains, this economic calculus willnot determine (necessarily) the firm’s ultimate decision.8 With re-spect to ISO 14001 institutional impact, we argue that ISO 14001can trigger a change in the firm’s internal dynamic through thevarious new routines it introduces. These routines ensure that en-vironmental concerns will receive a stronger presence in the firm’sdecisionmaking process, allowing for the discursive expression ofmotivations and ideas that may have been suppressed under theprevious regime. By creating new routines for selecting, ordering,and processing information, the system also extends the organiza-tion’s cognitive horizon, enabling the generation of new environ-mentally related data that would not have been available to theorganization beforehand.

By making environmental issues more salient and by imposinga process of continual improvement and reflection, the ISO 14001system drives the organization to deal with competing (internal)economic and environmental demands and to develop new mech-anisms for resolving potential tensions between them. This contin-uous internal contestation is an important source of technologicaland social innovation. While this internal tension may exist in un-certified firms, ISO 14001 bolsters this process by giving it per-manent structural form. The adoption of ISO 14001 facilitates,then, a shift into a new dynamic equilibrium, in which environ-mental concerns are given more weight. The third-party certifica-tion and auditing system associated with ISO 14001 providesfurther support to the internalization of ISO 14001 structural re-quirements (Potoski & Prakash 2006:19; Andrews 2001:78–88).The new dynamic induced by ISO 14001 is not determined by themotivations that moved the organization to adopt the standard inthe first place (and thus can take place in organizations that are notideologically ‘‘green’’).

The viability and resilience of this new equilibrium stems fromseveral sociological and psychological processes, which cannot be

8 For the cost of certification, see Jiang and Bansal (2003:1049) and Prakash andPotoski (2006:27). For the varied considerations affecting the certification decision, seeBorck (2008:118–9).


understood by viewing the firm, and the interaction between thefirm and its employees, solely through the lens of a calculative,economic logic. First, this new equilibrium draws on the reputa-tional benefits of ISO 14001 (Prakash & Potoski 2006; Reinhardtet al. 2008:225–8). Second, it reflects further benefits that are madepossible by the new information generated by the system and theinnovative drive it unleashes. A good example is efficiency gainsgenerated by new technological or institutional techniques (e.g.,new recycling techniques and enhanced energy efficiency). A thirdsource of viability is the virtuous reciprocal interaction that the im-plementation of ISO 14001 generates between the firm’s new struc-ture and its workforce. Finally, the resilience of the new equilibriumreflects the fact that once the organization settles into this new equi-librium state, ‘‘going back’’ through, for example, abrupt decertifi-cation, may be costly. These costs reflect both the costs of dismantlingthe new routinesFwhich become entrenched in the organization’sstructureFand the adverse effects of breaking the aforementionedvirtuous cycle (e.g., damaging the employees’ trust in the firm).

One of the key features of the ISO 14001 system is the virtuouscycle it generates between the new organizational reality and themotivations and beliefs of the employees.9 There is, in this context,an amplifying feedback between the organizational and individuallevels. This reciprocal cycle is driven by four key processes.

First, the EMS creates a system of internal organizationalnorms that operate alongside the external system of statutorynorms.

Second, the adoption of a comprehensive EMS can leadFthrough the emphasis it places on the environmental issueFto theinternalization of environmental values in employees who did notpreviously have a clear position on this issue. It is also likely tostrengthen pro-environmental attitudes in workers who are al-ready committed to the environmental cause. We conceptualize thecommitment to the environment as an internal, obligation-based,motivation (Frey & Jegen 1999:4; Osterloh et al. 2001:233). In-trinsic motivation should be distinguished from extrinsic motiva-tion, which acts through external incentives (e.g., monetary) and isnormally instrumentalFthat is, aimed toward achieving a specifiedobjective (Ryan & Deci 2000:71).10

The causal mechanism underlying the internalization processis complex. It reflects the symbolic (legitimizing) value of the

9 This idea is mentioned by other CSR scholars (Reinhardt et al. 2008:226; Portney2008:264, 266). However, these authors do not offer a detailed socio-psychological modelthat can explain the mechanics of this virtuous cycle.

10 This conceptual scheme closely resembles March and Olsen’s distinction betweenthe logic of expected consequences and the logic of appropriateness (1998:949–52).


organizational decision to adopt the standard (Vigoda & Go-lembiewski 2001:545), the informative aspect of the certificationprocess (e.g., providing information about the consequences ofimproper environmental behavior through training, monitoring,etc.), the creation of an explicit framework for placing responsi-bility for negative environmental behavior, and the creation of anorganizational sphere conducive to public expression of the inter-nal stance (Nyborg 1999:420). The structure of ISO 14001, whichis based on continuous improvement and not on a rigid system ofsanctions, and provides a framework for involving employees inthe management of the environmental aspects of the organization’sactivities, can enhance employees’ intrinsic motivation. This effectis facilitated by the EMS’s positive influence on employees’ per-ceived competence and on their experienced autonomy (Th�ger-sen 2003:201).

Third, strengthening the environmental commitment of theorganization through ISO 14001 certification is also likely to in-crease the commitment of employees to the organization.11 Thishypothesis is based on the findings of several studies, which find apositive correlation between corporate citizenship and commit-ment to the organization (Turban & Greening 1997:666; Maignanet al. 1999:458, 464). Environmentally conscious firms are alsolikely to be associated with higher levels of organizational citizen-ship behavior, defined as ‘‘individual behavior that is discretionary,not directly or explicitly recognized by the formal reward system,and that in the aggregate promotes the effective functioning of theorganization’’ (Podsakoff et al. 2000:513). Organizational citizen-ship behavior has been found to be positively correlated with jobperformance and organizational performance (Podsakoff et al.2000:537, 541, 543–8; Podsakoff & MacKenzie 1997:142) and withemployees’ commitment (Meyer et al. 2002:22, 39).

Fourth, the foregoing processes will support and further en-trench the institutional changes instigated by the standard, by in-creasing the employees’ willingness to invoke the new conceptualapparatus introduced by the EMS and to implement its routines.

Cumulatively, the institutional and personal processes de-scribed above should positively affect both the environmental andnonenvironmental output of employees in certified firms. Theeffect of the EMS on the employees’ internal norms system and ontheir commitment to the organization therefore has importanteconomic implications. It unleashes economic resources thatwere not available in the previous organizational setting. First, byaffecting the internally driven (noninstrumental) willingness of

11 It should be noted though that organizational commitment depends also on otherfactors, such as the work environment and the costs of leaving the organization.


employees to engage in pro-environmental behaviors (e.g., recy-cling, conservation of water and electricity, and greater attention toenvironmental risks such as leakage of hazardous materials), firmscan improve their environmental performance without bearing thefull cost of this improvement. Second, the increase in employees’commitment to the organizationFreflected in increased levels ofcitizenship behaviorFcan contribute to the firm’s financial per-formance. These two processes provide a further explanation forthe ability of firms to bear the costs of certification, and achievebeyond compliance targets, without sacrificing profits.

The Polyphonic Model and Other Models of the Firm

How does the polyphonic model differ from the agency cost (ortransaction cost) model and stakeholder theory? These rival the-ories dominate the contemporary corporate governance literatureand as such deserve special consideration (Agle et al. 2008).

Consider, first, the models of agency cost or transaction cost.The first difference between these models and the polyphonicmodel lies in their concept of human agency. The agency andtransaction cost models base their policy prescriptions on the ideathat self-interested, material opportunism is a primary trait of hu-man agency (Williamson 1998:31; Allen 1993:1401). This under-standing of human motivation disregards the possibilityFbackedby numerous studiesFthat managers, employees, and sharehold-ers may be driven by a complex set of motives, which may reflectother-regarding and duty-oriented concerns (e.g., environmentalcommitment) (Perez 2008:157–62; Richardson 2008:180–5).Adopting a more pluralistic concept of the self challenges theprincipal/agent problematic that drives these models. Further, thisshallow understanding of the self makes the agency and transactioncost models inattentive to the limitations of monetary incentivesand hierarchical control as modes of governance. There is ampleevidence that hierarchical control and outcome-based incentivesmay have counterproductive results, such as increasing the distrustbetween managers and employees and decreasing people’s intrin-sic motivation (Ghoshal 2005:85).

A second difference concerns the way in which the agency andtransaction cost models conceptualize the firm as a social entity.Both models take a highly reductionist approach to this question,attributing everything that goes within the corporation to individ-ual decisionmaking (Reinhardt et al. 2008:227) and disregardingthe independent causal influence of the organization’s structure.This approach is reflected in the claim that the firm’s social struc-ture can be gleaned by enumerating the formal contracts associated


with it (Williamson 1998:35; Eisenberg 1999). The polyphonicmodel rejects this reductionist claim, highlighting instead the in-tricate linkage between the organization’s structure and individualaction.

The polyphonic model is closer in its approach to stakeholdertheory in that both models reject the attempt to ascribe a singlegoal to the corporation. Nonetheless there are deep differencesbetween the two approaches. First, stakeholder theory is promi-nently normative. It seeks to provide normative guidance to thefirm’s managers, arguing that managers ‘‘ought to view the inter-ests of stakeholders as having intrinsic worth and should pursuethe interests of multiple stakeholders’’ (Donaldson 1999:238). Thestakeholder model thus prohibits the mobilization of the firm’s re-sources to the benefit of any single constituency (such as share-holders) (Donaldson & Preston 1995:87). The Clarkson Principlesof stakeholder management provide a leading example of this facetof stakeholder theory.12 The polyphonic model, by contrast, is nota normative theory. Rather, it takes interest in the way in whichdifferent normative ordersFboth external and internalFinflu-ence the firm’s dynamic.

But the stakeholder model also makes certain empirical claimsabout the structure of firms. Thus, for example, Donaldson andPreston describe the corporation as a ‘‘constellation of cooperativeand competitive interests possessing intrinsic value’’ (1995:66).And in describing the way in which firms respond to these multipleclaims, Freeman and colleagues argue that firms may develop di-verse normative cores (2004:368). The strong pluralistic spirit un-derlying these claims marks an important common groundbetween the polyphonic model and stakeholder theory.

However, stakeholder theory does not provide a coherent so-ciological account of the way in which these competitive interestsare manifested in the firm’s structure. Stakeholder theorists tendto focus on the way in which stakeholder claims influencemanagerial decisionmaking (Gunningham et al. 2004:326–8;Donaldson & Preston 1995:75). This approach seems lacking inthat it fails to give proper weight to the autonomous impact ofthe firm’s institutional structure. The polyphonic model seeks tounfold the way in which corporationsFas self-referential com-municative systemsFreconstruct the claims of different stakehold-ers (e.g., nature, employees)Faccording to their self-createdprograms and routines. It also seeks to shed light on the in-tricate relationship between the corporate culture and its emp-loyees and managers, highlighting the independent causal roleof each.

12 See http://www.rotman.utoronto.ca/�stake/principles.htm (accessed 28 May 2009).


The Empirical Study

The empirical part of the study focuses on one key element ofour theoretical framework: the claim that ISO 14001 may transformthe firm’s internal dynamic in a pro-environmental fashion, gener-ating a virtuous cycle between the firm’s new environmentally sen-sitive structure and the perceptions, attitudes, and beliefs of theemployeesFtoward the environment and the organization. In thiscontext we focused on two key questions: the impact of ISO 14001on the firm’s internal structure and on its ecological commitment andthe impact of ISO 14001 on the employees’ attitudes toward theorganization and the environment. In studying these questions weemployed a multimethod research design, using in-depth interviewswith executives in combination with structured questionnaires thatwere administered to employees in certified and noncertified firms.

In analyzing the structured questionnaires and in-depth inter-views we have drawn on the following set of hypotheses.

1. The environmental commitment of certified firms, as perceivedby their managers, will be higher than that of noncertified firms.

2. The environmental commitment of certified firms, as perceivedby their employees, will be higher than that of noncertified firms.

3. Among certified firms, the environmental commitment of thefirm, as perceived by the firm’s employees, will be higher amongemployees with a high integration score than among employeeswith a low integration score.

4. The adoption and implementation of the ISO 14001 EMS islikely to enhance the environmental commitment of employees.

5. An increase in the firm’s environmental commitment score, as itis perceived by the firm’s employees, will be positively associatedwith all three organizational citizenship behavior (OCB) in-dexes. This association will be stronger within ISO 14001 firmsthan within noncertified firms.

Data and Methods

ParticipantsThe Firms’ Sample. Twenty-four firms of varied sizes (medium

and large) participated in the study, half with ISO 14001 certifi-cation (henceforth, ‘‘certified firms’’), and half without. The firmsare located in different geographic areas and belong to variouseconomic sectors. Eight of the organizations (33.3%) belong to thechemical sector and the rest to the following sectors: electrical andelectronics (N 5 5, 20.8%), food (N 5 3, 12.5%), metal (N 5 3,12.5%), paper and byproducts (N 5 2, 8.3%), trade and services(N 5 2, 8.3%), and construction (N 5 1, 4.2%).


The Executives’ Sample. Of the 47 participating executives, 36(76.6%) were employed by 19 firms where employees were alsosampled and 11 (23.4%) were employed by five other firms.Twenty-four executives (51.1%) were employed by 12 certified or-ganizations and 23 (48.9%) were employed by 12 noncertified or-ganizations. Forty-two executives were men (89.4%) and 5 werewomen (10.6%).

The Employees’ Sample. Of the 576 participating employees,400 (69.4%) were employed by 10 certified firms and 176 (30.6%)by 9 noncertified firms. Employees included manufacturing work-ers (46.1%), middle- to low-level managers (22.7%), service pro-viders from administration and marketing (15.8%), and expertemployees (e.g., chemists, engineers; 15.4%). Eighty-four percentof the employees were male and 16% were female. Finally, 41.9% ofthe participants had an academic education, 52.8% a high-schooleducation, and 5.3% an elementary education.

ToolsAll questionnaires (apart from the OCB) were designed espe-

cially for this study.

Questionnaires for Senior Managers in Certified and Non-certified Firms. The interviews of senior managers were based onthe following questionnaires:

Demographic Data and Firm’s Profile. This questionnaire included11 questions dealing with the personal and professional back-ground of the manager, such as academic degree, gender, positionin the organization, and length of employment. It also includedquestions about the firm’s main area of activity, number of em-ployees, competing firms, export rates (of the total output), andwhether the firm was part of a conglomerate.

Environmental Commitment. This questionnaire examined theenvironmental commitment of the firm according to the managers’perception, irrespective of the question of ISO 14001 certification.The questionnaire included 15 questions (mostly formulated asopen-ended ones) dealing with the firm’s approach to environ-mental matters. It referred, for example, to the existence of a unitin the firm responsible for environmental issues, to the existence offormal policy on environmental matters, to the actions taken by thefirm to comply with regulatory requirements or go beyond them,to the existence of an internal (emissions) monitoring system, to theinvolvement of senior management in environmental issues, and tothe level of training on environmental issues. In noncertified firmsan additional question was included related to the existence of analternative (non-ISO) EMS.


ISO 14001. This questionnaire, which was administered onlyamong managers of certified firms, examined the implementationand integration of the standard. The questionnaire included 32questions mostly formulated as open-ended ones. It included, forexample, questions concerning technological and organizationalchanges in the firm following certification, changes in the firm’sculture and objectives, the environmental impact of the EMS, pos-sible consequences of violating the ISO 14001 guidelines, and sev-eral questions concerning the EMS as a possible substitute forpublic regulation. In addition, managers responded to a sectionabout the central motivation for certification and the degree ofenvironmental improvement following certification. This sectionincluded verbal descriptions, such as ‘‘How is the improvement inenvironmental behavior expressed?’’ It also included a ranking ofthe motivational factors for certification on a 5-point scale, rangingfrom ‘‘not at all’’ (1) to ‘‘very significantly’’ (5).

Motivations and Environmental Behavior. This questionnaire,which was administered only among managers of noncertifiedfirms, examined various aspects of the firm’s attitude toward en-vironmental issues. The questionnaire included eight questions,the majority of them formulated as open-ended questions, con-cerning for example, preventive actions taken by the firm, themotivations for the firm’s decisions regarding environmental is-sues, the reasons for not adopting the ISO 14001 EMS, and factorsaffecting the firm’s environmental behavior.

Questionnaires for Employees in Certified and NoncertifiedFirms. The interviews of employees were based on the followingquestionnaires:

Demographic Data. This questionnaire included six questions,mostly open-ended, dealing with education level, gender, positionin the organization, length of employment, and whether the em-ployee had an environmental responsibility.

Environmental Commitment. This questionnaire was similar to themanagers’ questionnaire but included only 10 questions, whichwere formulated as closed questions. In noncertified firms, an ad-ditional question was included about the existence of an alternative(non-ISO) EMS.

OCB Questionnaire. The OCB questionnaire included 27 state-ments that referred to the level of involvement and commitment ofthe employees to their role, the organization, and their colleaguesand superiors.13 The questionnaire was divided into three domains:

13 This questionnaire drew on the work of Vigoda (1999), Cohen and Vigoda (2000),and Ilani (1998).


1. OCB–job performance: referred to commitment to the role andcompliance with internal guidelines and norms. It distinguishedbetween a worker’s behavior according to the organization’s in-ternal rules (as represented by this domain) and forms of be-havior that went beyond formal expectations (as represented bythe other two domains). Sample statement: ‘‘I am committed tothe guidelines and norms that protect the organization.’’

2. OCB–interpersonal behavior: referred to helping behavior to-ward coworkers in a task or problem relevant to the organiza-tion. Sample statement: ‘‘I assist my colleagues after they returnto work following a long period of absence.’’

3. OCB–civic virtue: included the involvement of the worker indecisionmaking processes in the organization. Sample state-ment: ‘‘I participate in decisions related to the creation of in-ternal guidelines and norms within the organization.’’

ISO 14001. This questionnaire, which was administered onlyamong employees of ISO 14001 firms, examined the implemen-tation and integration of the standard. The questionnaire included14 questions formulated generally as closed questions. They cov-ered issues such as the organization’s environmental behavior priorto certification, internal and external inspections with respect tothe implementation of ISO 14001, technological and organizationalchanges following certification, and the impact of the standard onthe employee, the employee’s role, and the environment. Exceptfor several questions with a choice of two answers (yes/no), theemployee was asked to choose from five options on a scale rangingfrom ‘‘not at all’’ (1) to ‘‘very much’’ (5).

Index Design and Score ComputationIn order to analyze the interviews and questionnaires we de-

veloped several indexes, which are described below.

Environmental Commitment Index. The Environmental com-mitment index examined how the employees and managers of allparticipating firms (with and without certification) perceived thefirm’s commitment to the environment, as reflected in the firm’sstructure. The score given to each interviewee was computed bysumming up the interviewee’s answers to questions dealing withthe organization’s approach to environmental matters, and by con-verting the resulting score to percentages. The index comprisedeight questions taken from the environmental commitment ques-tionnaire. There were slight differences between the indexes ofmanagers and employees. The higher the score on this index, thegreater the environmental commitment of the organization as per-ceived by the interviewee. The internal consistency coefficient


(Cronbach’s a) for these questions was a5 0.79 among managersand a5 0.80 among employees.

ISO 14001 Integration Index. The ISO 14001 integration in-dex reflected the degree to which the firm had implemented andassimilated the different elements of the EMS into its internalstructure as perceived by the employees. The index examined howthe firm supervised the application of the EMS rules, the impact ofthe EMS on the organization (from a technological and organiza-tional perspective), and the changes the system instigated at theemployee level (in the employee’s job description and in the em-ployee’s environmental worldview). The index’s score was calcu-lated only among employees of certified firms by summing up theparticipants’ responses to questions dealing with the implementa-tion and impact of the ISO 14001 EMS and by convertingthe resulting score to percentages. The index comprised sevenquestions taken from the ISO 14001 questionnaire. The internalconsistency coefficient (Cronbach’s a) for these questions wasa5 0.70.

Organizational Environmental Motivation Indexes. The en-vironmental motivation indexes reflected the various motivationsthat led firms to certify for ISO 14001, or to adopt a pro-environ-ment policy (in the case of noncertified firms), as these motivationswere perceived by managers in both firm types. We computed fourmotivational scores covering four different areas: (1) public regu-lation and enforcement; (2) economic considerations (Israeli clientsand suppliers; foreign clients and suppliers; stockholders; com-petitors; business relations; operational considerations, a5 0.75);(3) environmental considerations (environmental organizations; asense of commitment to the environment, r 5 0.52, po0.001); and(4) responsibility for the community (employees; neighbors/neigh-boring community, r 5 0.25, po0.5). The scores were computed byaveraging the answers to the constituent motivation factors. Scoresranged from 1 to 5; the higher the score, the higher the level ofmotivation in the relevant area.

OCB Indexes. The OCB indexes examined the level of OCBwithin participating employees of both firms’ categories, focusingon three dimensions: organizational compliance (OCB–job-perfor-mance), helping behavior or interpersonal relationships (OCB–interpersonal behavior), and civic virtue (OCB–civic virtue).OCB–job performance refers to forms of behavior directed at theorganization, demonstrating compliance with formal or informalorganizational rules and procedures (such as high standardsfor attendance, punctuality, conservation of the organization’s re-sources, and use of time while at work) (Podsakoff et al. 2000:520;


Organ 1997:94–5). OCB–interpersonal behavior captures activitiessuch as assisting or emphatically interacting with specific individ-uals (coworkers, associates, clients, superiors) (Podsakoff et al.2000:518–9; Organ 1997:94). OCB–civic virtue refers to construc-tive involvement in the decisionmaking processes within the orga-nization (Podsakoff et al. 2000:522).

In order to design the OCB indexes, we performed a factoranalysis with Varimax rotation to the 27 questions of the OCBquestionnaire. The factors analysis fully validated the distinctionbetween the three behavioral domains. The three factors togetherexplained 39.58 percent of the total variance. The factor ‘‘com-mitment in the interpersonal domain’’ (OCB–interpersonal behav-ior) explained 14.81 percent of the variance (a5 0.79); the factor‘‘commitment to the job and obedience to rules and norms’’ (OCB–job performance) explained 13.13 percent of the variance(a5 0.75); and the factor ‘‘participation in the process of organi-zational decisionmaking’’ (OCB–civic virtue) explained 11.63 per-cent of the variance (a5 0.82). The internal consistency of allquestionnaire items was found to be high (a5 0.75). Drawing onthe findings of the factors analysis and the examination of the in-ternal consistency, we computed a score for each employee in eachof three factors. We did so by averaging the score in each of thequestions respectively for each index. The score ranged between 1and 5 such that a higher mark indicated a higher citizenship be-havior in the dimension measured by that index.

ProcedureMethod of Sampling ISO 14001 Organizations and Organi-

zations Without ISO 14001 EMS Certification. A list of 138 ISO14001 organizations provided to us by the Standards Institution ofIsrael (current as of January 2004) served as the basis for thephone solicitation of ISO 14001 firms. The various factories wereclassified according to district, sector, and size using the database ofDun & Bradstreet Israel. Selection was based on these three cri-teria. Factories of medium size and larger were preferred, with anattempt to represent every sector and district. The list of certifiedfirms was matched with a list of noncertified firms; for each ISO14001 firm we attempted to choose a similar firm based on thecriteria mentioned above. Of 66 organizations solicited by phone toparticipate in the research (32 ISO 14001 firms and 34 noncertifiedfirms), 24 firms agreed to participate in the final sample, half ofthem with ISO 14001 certification.

Interviews With Senior Managers. The managers who tookpart in the study were either members of the firm’s top manage-ment (for example, the vice president of human resources or


the chief operations officer) or executives involved in the manage-ment of the firm’s environmental matters (for example, the headof the environment and safety department or the head of qualityassurance). The managers were interviewed at their firms in astructured (oral) interview based on the corresponding question-naires.

Distribution of Questionnaires to Employees. Employees ofboth ISO 14001 and noncertified firms were selected for the ques-tionnaires based on several criteria. The initial preference was forproduction workers, but various lower-level position holders also par-ticipated in the research. The questionnaires were distributed over aperiod of 15 months. In ISO 14001 organizations the rate of responsewas 41.3%; in noncertified firms the rate of response was 33%.

Findings: Quantitative Analysis

To examine our hypotheses about the differences between theconception of the organization’s environmental commitmentamong managers and employees of ISO 14001 and noncertifiedfirms, we calculated a series of multiple linear regression equations,separately for managers (Table 1) and employees (Table 3). Wecalculated a separate equation for employees of ISO 14001 firms(Table 4). We also conducted a t-test to examine the differences inthe indexes of organizational environmental motivation betweencertified and noncertified firms, as perceived by the managers(Table 2).

In the regression equations used for managers, the dependentvariable was defined as the firm’s environmental commitment asreflected in the environmental commitment index; the indepen-dent variable was defined as ISO 14001 certification.14 The spec-ification of the regression model was:

Environmental commitment ðmanagersÞ ¼ b0xþd ISO 14001 certificationþ e

where the x vector included the additional attributes of the firm, thefirm’s environmental motivation indexes, and a constant (intercept).

We also conducted a t-test for independent samples to comparethe managers of the two firms’ categories with respect to the en-vironmental motivation indexes (Table 2).

14 Additional independent variables included in the regression equation for controlpurposes were organizational attributes and the environmental motivation indexes. Theorganizational attributes included the following variables: firm’s size (a variable approx-imated by computing the natural log of the number of employees in the firm); belonging tothe chemical sector (selected based on the assumption that the environmental issue is moresalient in petrochemical firms); belonging to a corporate conglomerate; and the natural logof the ratio of the production intended for export. In addition, the interaction between theISO 14001 certification variable and the conglomerate variable was examined.


The structure of the variables in the regression equations cal-culated for the employees was similar to that used for managers:the dependent variable was defined as the firm’s environmentalcommitment as reflected in the environmental commitment index,and the independent variable was defined as ISO 14001 certifica-tion (Table 3).15 The specification of the regression model was:

Environmental commitment ðemployeesÞ ¼b0xþd ISO 14001 certificationþe

where the x vector included the additional attributes of the firm,the attributes of the employees, the organization’s environmentalcommitment as perceived by the managers, and a constant(intercept).

To examine our third hypothesis, the employees of ISO 14001firms were divided into two groups according to their integrationscore. The first group included participants whose integrationscore was lower than or equal to the median of the entire group(med. 5 58.04). The average integration score in this group was41.25 and the standard deviation was 17.67 (N 5 215, 53.8%). Thesecond group included participants whose implementation scorewas higher than the median of the whole group. The average in-tegration score in this group was 77.56 and the standard deviationwas 11.76 (N 5 185, 46.3%).16 Next, a multiple linear regressionequation was performed. The dependent variable was defined asthe organizational commitment to the environment among em-ployees, and the independent variable was defined as the integra-tion of ISO 14001 (as reflected in the integration index).17 Thespecification of the regression model was:

Environmental commitment ðemployeesÞ¼ b0xþ d implementation of ISO 14001 EMSþ e

where the x vector included the additional organizational attri-butes, employee attributes, executive perception, and a constant(intercept).

To examine our fifth hypothesis regarding the OCB indexes, aseries of multiple linear regression equations was calculated. Theequations were calculated separately for employees of ISO 14001

15 Additional independent variables included in the regression equation for controlpurposes were organizational attributes (identical to the ones used above), employee at-tributes (gender, academic education, length of employment, and environmental role) andthe environmental commitment according to the executives’ perception. We also examinedthe interaction between the certification and conglomerate variables.

16 The percentages were calculated from the total of all employees of certified firms(N 5 400).

17 The regression equation included additional independent variables for controlpurposes: organizational attributes, employee attributes, and the environmental commit-ment according to the managers’ perception.


firms and those of noncertified firms (Table 5). In the regressionequations the dependent variable was defined as the OCB mea-sured by the three indexes: OCB–interpersonal behavior, OCB–jobperformance, and OCB–civic virtue. The independent variablewas defined as the firm’s environmental commitment as per-ceived by employees and executives (measured in their respectiveenvironmental commitment indexes).18 The specification of theregression model was:

Organizational Citizenship Behavior ¼ b0xþd environmental commitmentþe

where the x vector included the additional organizational attri-butes, employee attributes, executive perception, and a constant(intercept).

Table 1 shows estimates of the linear regression predictingorganizational commitment to the environment as perceivedby managers, using the ISO 14001 certification variable. Table 1shows that the equation for predicting organizational commitmentto the environment is significant, the explained variance is 49percent, and among the predicting variables, the ISO 14001 cer-tification variable alone had a significant positive unique contri-bution to the explanation (b5 0.54). Based upon the beta co-efficient and consistent with our first hypothesis, the perceptionof the firm’s environmental commitment among managers of

Table 1. Linear Regression Estimates Predicting Organizational Commitmentto the Environment as Perceived by Managers, Using the ISO 14001Certification Variable (N 5 47)

VariableOrganizational attributesISO 14001 0.54n (7.59)Employed 0.17 (2.24)Chemical industry 0.11 (4.87)Organization is part of a network of organizations 0.14 (7.82)Export rate � 0.23 (0.82)Organization � ISO 14001 as part of a network of organizations 0.07 (10.75)Motivation indexesPublic regulation 0.20 (2.06)Economic considerations 0.15 (3.59)Environmental considerations 0.18 (3.39)Responsibility toward the community � 0.33 (3.40)R2 0.49F 3.47nn

Regression df 10Residual df 36

Note: Coefficients are standardized (b). Standard errors in parentheses.npo0.05; nnpo0.01

18 Additional independent variables included in the regression equation for controlpurposes were organizational attributes and employee attributes (identical to the ones usedabove).


ISO 14001 firms was higher than among managers of noncertifiedfirms.

Table 2 shows averages, standard deviations, and values oft-tests for independent samples of organizational environmentalmotivation. The analysis was conducted at the executive level(N 5 47). Table 2 shows that the strength of considerations havingto do with public regulation and enforcement involved in certifi-cation (or in the adoption of environmental policy in noncertifiedfirms) was lower among managers of certified firms (M 5 2.29,SD 5 1.46) than among managers of noncertified firms (M 5 3.43,SD 5 0.94). No significant differences were found among the othermotivation indexes (p40.05). The findings also indicate that forboth groups public regulation and enforcement and environ-mental considerations were higher motivations than economicconsiderations.

Table 3 shows estimates of the linear regression for predictingthe organizational environmental commitment according to theemployees’ perception, using the ISO 14001 certification variableand environmental commitment according to the executives’ per-ception. Table 3 shows that the equation for predicting organiza-tional environmental commitment according to the employees’perception was significant, and the explained variance was 42 per-cent. Among the predicting variables, the ISO 14001 certificationvariable was the one with the highest significant unique contribu-tion to the explained variance (b5 0.72). Based upon the betacoefficient and consistent with the second hypothesis, employees ofISO 14001 certified firms were found to have a higher perceptionof organizational environmental commitment than those of non-certified firms. The index of organizational environmental com-mitment based on the managers’ perception contributedsignificantly and positively to the explained variance. The higherthe organizational environmental commitment was according tothe executives’ perception, the higher the organizational environ-mental commitment was according to the employees’ perception.

Table 2. Differences in the Indexes of Organizational Environmental Motiva-tion Between Executives of Certified and Noncertified Firms (N 5 47)

Motivation index

Managers inISO 14001

firms(N 5 24)

Managers innoncertified

firms(N 5 23)

tM SD M SD

Public regulation and enforcement 2.29 1.46 3.43 0.94 t(40) 5 3.20nn

Economic considerations 1.46 .87 1.52 0.93 t(45) 5 0.22Environmental considerations 2.58 1.11 2.22 1.18 t(45) 5 �1.09Responsibility toward the community 1.96 1.29 2.28 1.23 t(45) 5 0.88

nnpo0.01


This pattern was not found to be significant among employees ofISO 14001 firms.19

Table 4 shows the linear regression estimates for predicting or-ganizational environmental commitment according to employees’perception in ISO 14001 firms, using the ISO 14001 integrationvariable and the environmental commitment according to the exec-utives’ perception. Table 4 shows that the equation for predicting

Table 3. Estimates of the Linear Regression for Predicting the OrganizationalEnvironmental Commitment According to the Employees’ Percep-tion, Using the ISO 14001 Certification Variable and EnvironmentalCommitment According to the Executives’ Perception

The VariableAll employees

(N 5 576)

Employees inISO 14001

organizations(N 5 400)

Employees innoncertifiedorganizations

(N 5 176)

Organizational attributesISO 14001 0.72nnn (4.86) – –Employees 0.25nnn (1.84) 0.42nn (2.99) 0.11 (5.70)Chemical industry 0.20nnn (2.15) 0.31nnn (3.08) 0.21nn (3.97)Organization is part of anetwork of organizations

0.07 (4.08) � 0.62nnn (5.59) 0.02 (6.02)

Export rate �0.16nn (0.55) � 0.24 (1.09) �0.13 (0.76)ISO 14001 � Organizationis part of a network oforganizations

�0.62nnn (5.93) – –

Employee attributesGender (male) 0.03 (2.29) 0.02 (2.76) 0.07 (4.20)Academic education 0.01 (1.74) 0.07 (1.90) �0.06 (3.88)Duration of employment inthe organization

0.04 (0.16) 0.10 (0.10) 0.02 (0.20)

Environmental role 0.15nnn (2.26) 0.18nnn (2.37) 0.19nn (5.37)ISO 14001 � Duration ofemployment in theorganization

0.04 (0.19) – –

Environmental commitmentExecutives’ perception (ofthe firm’s environmentalcommitment)

0.18n (0.12) � 0.03 (.23) 0.22n (0.18)

R2 0.42 0.18 0.16F 34.06nnn 9.32nnn 3.59nnn

Regression df 12 9 9Residual df 563 390 166

Note: Coefficients are standardized (b). Standard errors in parentheses.npo0.05; nnpo0.01; nnnpo0.001

19 Among the other organizational and employee variables that were included in theregression equation, the variables representing the employees’ number, chemical industry, andenvironmental role contributed significantly and positively to the explained variance. Thus, thelarger the firm was, the greater the organizational environmental commitment according to theemployees’ conception. In chemical-sector firms, organizational environmental commitmentaccording to the employees’ perception was higher than in firms in other sectors. Amongemployees with an environmental role, the organizational environmental commitment washigher than that of other employees. In addition, we found that the higher the ratio of exports,the lower the organizational environmental commitment. The interaction between ISO 14001certification and being part of a conglomerate indicated that in ISO 14001 firms that were partof a conglomerate, the organizational environmental commitment was lower than among in-dependent ISO 14001 firms. We did not find such difference among noncertified firms.


organizational environmental commitment based on the perceptionof all employees of ISO 14001 firms was found to be significant, andthe explained variance was 32 percent. The ISO 14001 integrationvariable contributed uniquely to the explained variance (b5 0.27).Based upon the beta coefficient and consistent with the directionsuggested by the third hypothesis, we found that among employeeswith a high integration score the level of organizational environ-mental commitment according to the employees’ perception washigher than that of employees with a lower integration score.20

We also examined the influence of the degree of ISO 14001integration on workers’ environmental commitment.21 We foundthat employees with a high integration score had a significantly

Table 4. Estimates for Predicting Organizational Environmental CommitmentAccording to Employees’ Perception in ISO 14001 Firms, Using theISO 14001 Integration Variable and the Environmental CommitmentAccording to the Executives’ Perception (N 5 400)

The Variable

Employees inISO 14001

organizations(N 5 400)

Employees withhigh scores of

ISO 14001implementation

(N 5 185)

Employeeswith low scoresof ISO 14001

implementation(N 5 215)

Organizational attributesISO 14001 implementation 0.27nn (3.25) – –Employees 0.28n (2.77) 0.68nn (3.29) 0.14 (4.21)Chemical industry 0.20nn (2.86) 0.27n (3.33) 0.23n (4.42)Organization is part of a network oforganizations

� 0.42nn (5.81) �0.70nn (5.62) � 0.34 (8.61)

Export rate � 0.10 (1.01) �0.43n (1.15) 0.03 (1.57)ISO 14001 � Organization as partof a network of organizations

0.05 (4.14) – –

Employee attributesGender (male) � 0.02 (2.54) �0.01 (3.03) � 0.02 (3.80)Academic education 0.08 (1.74) �0.07 (1.89) 0.18n (2.83)Duration of employment in theorganization

� 0.01 (0.12) 0.13 (0.10) 0.01 (0.15)

Environmental role 0.11n (2.21) 0.12 (2.13) 0.10 (4.23)Implementation � Duration ofemployment in the organization

0.11 (0.17) – –

Environmental commitmentExecutives’ perception (of firm’senvironmental commitment)

� 0.01 (0.21) �0.20 (0.27) 0.04 (0.30)

R2 0.32 0.10 0.21F 15.01nnn 2.18n 5.95nnn



20 The environmental commitment according to the managers’ perception did notcontribute significantly to the explained variance. The results concerning the variables oforganizational and employee attributes included in the regression equation for controlpurposes were similar to those reported in Table 3.

21 The questionnaires included the following question: ‘‘To what degree have you be-come more committed to the environment as a result of the implementation of ISO 14001?’’


higher level of increase in their environmental commitment fol-lowing certification (N 5 183, M 5 3.29, SD 5 0.76) than employeeswith a low integration score (N 5 152, M 5 2.08, SD 5 1.13).22 Thisfinding was consistent with Hypothesis 4.

Table 5 shows estimates of the linear regression for predictingOCB as measured by the OCB indexes, using the organizationalenvironmental commitment according to employees’ and execu-tives’ perceptions. Table 5 shows that in ISO 14001 firms theequation for predicting OCB based on the organizational environ-mental commitment was found to be significant in all three mea-sures of OCB, and the range of explained variance was 7–9%. Theorganizational environmental commitment according to the em-ployees’ perception contributed uniquely and significantly to theexplained variance (b’s range: 0.13–0.20). Based upon the betacoefficients and consistent with the direction suggested by the fifthhypothesis, we found that as the perception of the firm’s environ-mental commitment increased among its employees, so did theemployees’ OCB score in the three indexes (OCB–interpersonalbehavior, OCB–job performance, OCB–civic virtue). The connec-tion between these measures was significant only among employeesof certified firms.23

Findings: Qualitative Analysis of Interviews

Interviews With Senior Executives in ISO 14001 FirmsIn general, the analysis of the interviews supports the findings

of the quantitative analysis; however, it also gives a clearer expres-sion of the limits of ISO 14001. In response to the question of thereasons motivating the organization to adopt the standard, themanagers emphasized instrumental considerations, such as pres-sure by clients (particularly large and overseas clients), regulatorybodies, and insurance companies. The managers also emphasizedthe value of certification as a vehicle for improving the firm’s rep-utation through the creation of a green image. A significant num-ber of executives noted, though, that a central consideration forcertification was ideologicalFa sense of commitment toward theenvironment and the neighboring community.

Most managers expressed the view that the system had a sig-nificant structural impact, giving the environmental issue a moresignificant presence in the organizational sphere. It appears thatthe EMS had a significant effect on organizational routines, infor-mation management, and decisionmaking processes. One manager

22 The analysis was based on a t-test: t(333) 5 � 11.65; po0.001.23 The organizational environmental commitment according to the executives’ per-

ception did not contribute significantly to the explained variance.


noted that the ‘‘ISO focused the problems.’’ Another managerremarked that that since certification ‘‘there are regular meetings,formal and systematic managerial influence, monitoring, and clearplans.’’ Other executives noted that that environmental and safetyofficers were appointed and that improvement and environmentalquality teams were established. Another manager mentioned

Table 5. Estimates of the Linear Regression for Predicting OCB Using theOrganizational Environmental Commitment According to Employees’and Executives’ Perception (N 5 576)

Employees in ISO 14001 organizations (N 5 400)

OCB–InterpersonalBehavior

OCB–JobPerformance

OCB–CivicVirtue

The VariableEnvironmental commitmentEmployees’ perception 0.13n (0.00) 0.14n (0.00) 0.20nnn (0.00)Executives’ perception � 0.04 (0.01) 0.04 (0.01) � 0.08 (0.01)Organizational attributesEmployees � 0.16 (0.12) � 0.26 (0.18) � 0.14 (0.08)Chemical industry � 0.12 (0.12) � 0.21nn (0.18) 0.07 (0.09)Organization is part of anetwork of organizations

0.18 (0.23) 0.30n (0.34) 0.03 (0.16)

Export rate 0.00 (0.04) 0.30n (0.06) 0.02 (0.03)Employee attributesGender (male) 0.18nnn (0.11) 0.02 (0.16) 0.08 (0.08)Academic education 0.01 (0.07) 0.07 (0.11) 0.06 (0.05)Duration of employment inthe organization

0.08 (0.00) 0.11 (0.01) 0.08 (0.00)

Environmental role 0.11 (0.10) 0.13nn (0.14) � 0.07 (0.07)R2 0.09 0.09 0.07F 3.93nnn 4.01nnn 2.86nn


Employees in noncertified organizations (N 5 176)

OCB–InterpersonalBehavior

OCB–JobPerformance

OCB–OrganizationalBehavior

The VariableEnvironmental commitmentEmployees’ perception 0.09 (0.00) 0.09 (0.00) 0.05 (0.00)Executives’ perception � 0.01 (0.00) � 0.02 (0.01) 0.10 (0.00)Organizational attributesEmployees 0.13 (0.14) � 0.08 (0.27) 0.24n (0.09)Chemical industry � 0.04 (0.10) � 0.14 (0.19) � 0.16 (0.06)Organization is part of anetwork of organizations

0.23n (0.14) � 0.17 (0.28) 0.08 (0.09)

Export rate � 0.06 (0.02) 0.18 (0.04) � 0.24n (0.01)Employee attributesGender (male) 0.11 (0.10) 0.10 (0.20) 0.04 (0.07)Academic education � 0.15 (0.09) 0.18n (0.18) � 0.12 (0.06)Duration of employment inthe organization

0.11 (0.00) 0.07 (0.01) 0.02 (0.00)

Environmental role � 0.08 (0.13) 0.11 (0.26) 0.02 (0.09)R2 0.11 0.10 0.12F 2.12n 1.90n 2.21n




that ‘‘everything is much more precise and measurable. Every ac-tion is preceded by contemplation. There is a decisive attitude toimprove and act on behalf of the environment.’’ He added that as aresult of implementing the standard, ‘‘environmental protectionand safety are taken into consideration as part of the daily routine.’’Another manager from the electronics sector noted that ‘‘the ob-jective has changed, from complying with legal requirements tobeyond compliance.’’ Several managers noted that the standardserved as a catalyst for installation and procurement of new tech-nologies and for reforming the firms’ production and operationmethods.

The managers also noted that the standard increased theawareness and commitment of the employees to environmentalissues and extended their involvement in the management of thefirm’s environmental impact. One manager remarked that ‘‘em-ployees are involved by sharing responsibility; they go throughevery stage of the process and maintain discussions.’’ Another in-terviewee stated that the standard created team spirit and that theissue became part of the factory’s culture. Another manager em-phasized that the ISO 14001 EMS was ‘‘the only way to transmitthe message on to the worker in the field.’’ Many executives notedthat integrating the system increased the employees’ environmen-tal commitment, enhancing their willingness to contribute to thefirm’s environmental performance (e.g., through greater invest-ment in recycling, conserving environmental inputs such as water,and paying greater attention to environmental risks such as leak-age of hazardous substances). Nevertheless, it appears that thesystem was applied in hierarchical rather than cooperative fashionacross the board.

Nonetheless, in response to the question of whether ISO 14001can be a substitute for public regulation, a large number of man-agers noted that a voluntary EMS cannot replace legislation. First,some of the managers criticized the wide discretion the standardgrants organizations in designing their environmental policy. Thefact that ISO 14001 is a process-based standard was also high-lighted in this context: ‘‘The standard cannot replace public reg-ulation because it requires, in essence, processes and not results.Therefore, a positive process with negative results is possible.’’Second, some managers criticized the voluntary nature of thestandard. A third strand of criticism dealt with the quality andintegrity of the external audit.

The analysis of the interviews supports our initial hypothesisconcerning the ability of the ISO 14001 EMS to induce significantand changes in the internal dynamic of certified firms. The keyelements of the ISO 14001 EMS were those that created new rou-tines: instructions dealing with top-management responsibility,


documentation, monitoring, training, regular inspections, and re-view. Managerial attitudes concerning the impact of certification onthe organizational culture and the employees’ state of mind alsosupported the hypothesis that ISO 14001 can bolster a process ofinternalization of pro-environmental norms among the firm’s em-ployees. Nevertheless, most managers noted that the ISO 14001system cannot replace public regulation, and some expresseddoubts about its effectiveness.

Interviews With Senior Executives of Noncertified FirmsA key issue that was raised in the interviews had to do with the

reasons underlying the firms’ decision not to adopt the ISO 14001standard. There were significant differences among the firms inthis respect. Some managers noted that the firm had a differentagenda and opted to focus on standards such as ISO 9000 and theHACCP food safety standard. Other managers mentioned the costof certification as a central barrier, and others mentioned lack ofawareness. Some indicated that they were in the process of adopt-ing the standard. Several executives strongly criticized the stan-dard. Thus, for example, one manager noted that ‘‘in general,there is a sense that those implementing the standard are eithergiant organizations that implement it throughout the organization,or problematic organizations that do it to gain acceptance and forthe sake of the certificate.’’ Another manager remarked that ‘‘inprinciple, standards are a purely bureaucratic issue. You can sellgarbage with a standard, because you set the standard.’’ Anotherexecutive indicated that the firm did not identify any special in-centive on the part of the government for implementing the stan-dard (any form of immunity or bureaucratic incentives), and nocommercial potential. Yet another executive said that the firm wasreluctant to implement the standard because of ‘‘the excess bu-reaucracy and regulation’’ associated with ISO 14001.

But this was not the position of all the managers. Some notedthat their firm was about to begin the ISO 14001 certification pro-cess, and that they had not done so to date because they were not‘‘prepared for the examination.’’ Others mentioned the fact thatISO 14001 is more stringent as a consideration for not adopting it.

Another interesting issue concerned the firms’ commitment tothe value of environmental protection. Sixteen out of 23 managersstated that the firm they worked for was very committed tothe environment (10 out of 12 firms surveyed). The managersemphasized several factors that motivated their companies to takeenvironmental action. Most prominent among them were legal re-quirements and governmental supervision (17 out of 23 mentionedthis issue as a main consideration). A variety of additional, lessdominant motivations was also mentioned, including environmen-


tal ideology, considerations of the organization’s image and repu-tation, and economic considerations such as pressure by clients andoperational considerations, employee safety, and pressure by theneighboring community.

Discussion

Our empirical findings lend support to the thesis that ISO14001 can induce pro-environmental dynamic within certifiedfirms. First, we found (consistent with Hypotheses 1 and 2) that theperception of the firm’s environmental commitment among man-agers and employees of ISO 14001 firms was higher than the per-ception among their peers in noncertified firms. We also found(consistent with Hypothesis 3) that among employees of ISO 14001firms, those with a higher integration score had a higher percep-tion of organizational environmental commitment.24

Second, our results also indicate that the certification processmay influence the attitudes of employees toward the environmentand the firm. We found, first, that employees with a high integra-tion score had a significantly higher level of increase in their en-vironmental commitment following certification than employeeswith a low integration score. This finding lends support to thefourth hypothesis, which claims that the implementation of ISO14001 is likely to enhance the employees’ (internal) environmentalcommitment. By focusing only on the ISO 14001 group, this anal-ysis has allowed us, in effect, to control for the impact of any pre-existing green ideology common to this group.

Further, we found a positive linkageFonly among certifiedfirmsFbetween the perception of organizational environmentalcommitment among employees and their OCB (consistent withHypothesis 5). This finding suggests that there was indeed some-thing institutionally unique in certified firms. A possible explana-tion for this result is that certification makes the environmentalissue more salient within ISO 14001 firms. Certification has a kindof internal reputation effect, which mirrors the external effect em-phasized by Potoski and Prakash.

The analysis of the in-depth interviews with the firms’ managerssheds further light on the structural impact of certification, demon-strating how the standard has increased the firms’ sensitivity to en-

24 In building our sample we tried to carefully match non-ISO with ISO firms, takinginto account various organizational attributes. We also controlled for some of these orga-nizational variables (e.g., chemical sector) in our regression analysis. It is interesting to notein this context that the employees’ perceived organizational environmental commitmentwithin chemical-sector firms, was higher than in firms in other sectors. This positive as-sociation was significant in both certified and noncertified firms. This result suggests that inchemical-sector firms the environmental issue receives some institutional salience.


vironmental issues. The discursive analysis of the interviews demon-strates not only the breadth of the pro-environmental changes in-duced by the standard, but also the standard’s innovative force as acatalyst for the installation of new technologies, and for the intro-duction of new production and operation techniques. The managerswe interviewed also made consistent remarks about the positive in-fluence of the system on the employees’ environmental commitment.The analysis of the interviews with the managers also demonstratedthat the organizational motivation for adopting pro-environmentalpolicies was in part ideological and not merely economic.25

The empirical results support our thesis that the adoption ofISO 14001 can move the firm into a new equilibrium trajectory,which enmeshes together environmental and economic goals andreflects greater ecological sensitivity. ISO 14001 operates in thiscontext as a social technology, which mediates between the envi-ronmental and economic dimensions. However, ISO 14001 doesnot offer a complete algorithm for resolving possible tensions be-tween these competing dimensions. This issue was reflected in theinterviews we conducted with the executives. Rather, ISO 14001drives the organization to develop, through a process of continuouslearning, ecologically ‘‘sensitive’’ mechanisms that could deal withsuch tensions. ISO 14001 can be viewed in that sense as inspiring ashift from myopic thinkingFfocusing on short-term profit maxi-mizationFinto long-run thinking (Jensen 2002:245).

The foregoing argument raises the question of the viability ofthe new (environmentally sensitive) organizational equilibrium(Reinhardt et al. 2008:219; Lyon & Maxwell 2008:241). The poly-phonic model suggests that the stability of this new equilibriumstems from the capacity of ISO 14001 to unleash hidden social andeconomic resources. In particular, our findings highlight the ca-pacity of certification to generate a self-supporting cycle betweenthe firm’s new environmentally sensitive structure and the em-ployees’ environmental and organizational attitudes. The contri-bution of ISO 14001 to the corporation’s survival is not limitedtherefore to the standard’s positive reputational effect (as empha-sized by Potoski and Prakash).

More generally, our findings challenge some of the presuppo-sitions that characterize the agency and transaction cost models andstakeholder theory. First, our findings challenge the idea that theinternal dynamic of firms is determined entirely by the idiosyncraticlogic of profit maximization. Our findings lend support to the idea

25 We examined the managers’ view of the reasons underlying the firm’s decision toeither go for certification or adopt pro-environmental policy (in noncertified firms). Wefound that the main reasons were public regulation and environmental considerations.Economic considerations (together with responsibility toward the community) were seen asless important.


that firms are polyphonic creatures, which may be driven by a plu-rality of logics and discursive streams. In contrast to the stakeholdermodel, which considers stakeholder claims as ‘‘external inputs’’ tointernal managerial decisions (Gunningham et al. 2004:326–8; Don-aldson & Preston 1995:75), the polyphonic model highlights howdifferent discursive themesFecological or economicFare woveninto the organization’s programs and routines, thereby influencingthe organization’s intrinsic communicative dynamic.

The polyphonic model also criticizes the attempt of the agencyand transaction cost models to study the internal dynamic of or-ganizations solely through an individualistic lens. It emphasizes, incontrast, ‘‘the role of institutions and institutionalization in the un-derstanding of human actions within an organization, social order,or society’’ (March & Olsen 1998:948). Indeed, this study hashighlighted the fact that as contexts of identification, trust, andcommitment, organizations can deeply influence the state of mindand behavioral choices of the individuals associated with them(Ghoshal & Moran 1995:15; Allen 1993:1401–3).

It is appropriate, in conclusion, to consider several method-ological limitations of the study and to highlight potential avenuesfor future research. As noted above, our findings demonstrate asignificant association between certification and various pro-envi-ronmental attitudinal factors within the managers and employeesin our sample. These findings, we argue, can be interpreted asindicators of ISO 14001 independent causal power in instigatingpro-environmental processes within certified firms. Arguably, theremight be a possible problem of endogeneity involved in the re-search design. That is, some of the observed and unobserved fac-tors that influence firms’ decision to join ISO 14001, such as thetype of business in which they engage or pre-existing institutionalor managerial support for the environmental cause, may also affecttheir institutional and pollution variables post-certification (Pra-kash & Potoski 2006:157; Borck et al. 2008).

We employed several methodological techniques in order todeal with the question of endogeneity, combining both discursiveand statistical analysis.26 These techniques provided a reasonablebasis for determining that ISO 14001 had an independent causalimpact. Nonetheless, our empirical work constitutes only a firststep in analyzing the sociological and psychological processes thattake place in firms implementing EMSs. We believe that moreeffort needs to be made in order to further study the intricatesociological and psychological processes that take place within

26 See the discussion on pp. 603–609 for details and the text above. For the value ofmultimethod analysis, see Ahrens and Chapman (2006:822) and Fine and Elsbach(2000:53).


organizations that adopt environmental self-management schemes.Below we sketch several directions for future research (respondingto some of the limitations of our study).

First, studying the structural impacts of certification and thelinkage between these structural changes and the attitudes of em-ployees requires longitudinal studies that will examine the dynamicof certified firms over time (against appropriate samples of non-participants). It would also be important in this context to gatherrelevant precertification data, referring, for example, to the firm’s(and its employees’) environmental commitment. Second, it will beinteresting to explore the relation between the environmentalcommitment variable and other variables that may influence em-ployees’ commitment to the organization, such as the firm’s policyon gender equality and other factors influencing the work expe-rience. A further valuable extension will be to assess the employees’environmental commitment through richer measures of pro-envi-ronmental orientation, such as the New Ecological Paradigm Scale(Dunlap et al. 2000; Schultz 2001). Fourth, another fruitful direc-tion will be to compare between ISO 14001 and other voluntaryinitiatives such as Responsible Care and the Forest StewardshipCouncil scheme. Finally, it will also be interesting to link betweenthe attitudinal measures used in our study and eco-physical orcompliance indicators.27

Policy Implications

Our study highlights the capacity of ISO 14001 to instigate apro-environmental dynamic within certified firms. Our results areconsistent with the findings of a large number of studies, whichhave found that ISO 14001 positively influences the environmentalperformance of subscribing organizations.28

The findings of this and other studies that have examined theenvironmental efficacy of ISO 14001 justify the development of aregulatory program that will encourage firms to adopt the ISO14001 EMS. Underlying this policy recommendation is the poten-tial gap between the initial stage in which a firm considers whetherto go for certification, and the second stage, that of implementationof the ISO 14001 EMS. Our study lends support to the idea that

27 Another interesting question concerns the relationship between the environmentalattitudes of the executives and the effectiveness of the EMS (Coglianese & Nash 2001:12–14). We believe that ISO 14001 can influence the organization regardless of the initialattitudes of the executives, although these attitudes can have an enhancing/diminishingimpact.

28 See, e.g., Dasgupta et al. (1997); Potoski and Prakash (2005a, 2005b); Anton et al.(2004); Newbold (2006); Goh-Eng, Suhaiza, and Nabsiah Abd (2006), and Gouldson(2005). For a more cautious view of ISO 14001, see Darnall and Sides (2008).


certification can move the organization into a new and moreenvironmentally friendly equilibrium, irrespective of its priorideological commitments. Since the certification decision is gov-erned by a combination of economic, ideological, and legalconsiderations, firms that believe that the cost of certification ishigher than the associated benefits or are not ideologically ‘‘green’’may avoid certification, depriving society of the ecological benefitsassociated with certification. This phenomenon can also reflect acertain cognitive bias on the part of top executives, who may failto recognize the potential virtuous cycle between certificationand the employees’ attitudes. The gap between the private con-siderations affecting the initial certification decision and the publicbenefits associated with certification constitutes the basic justifica-tion for providing regulatory incentives for certification; it couldalso justify requiring firms with a high-risk profile to obtain cer-tification.

A regulatory scheme seeking to encourage the adoption ofEMSs should provide substantial benefits to certified firms. Webelieve that the EU EMAS scheme constitutes a useful model in thiscontext.29 Programs of environmental excellence, which include anin-built requirement for EMS, exist also in the United States andCanada (Borck et al. 2009), although they seem to reflect a morecautious approach in terms of the incentives they provide to par-ticipating firms.30

Our policy proposal is somewhat incompatible with the currentcallsFpost the 2008 financial crisisFfor ‘‘re-regulation’’ (Crook2008; Mandel 2008). These calls reflect skepticism with respect tothe capacity of self-regulatory programs to achieve regulatorygoals. We do not think that the events of 2008 justify a completerejection of the self-regulation model. Such rejection would bothdisregard the creative and pro-social capacities of individuals andorganizations and overstate the social-engineering capabilities ofregulators. However, we do recognize that self-regulation schemes

29 See Regulation (EC) No. 761/2001 of the European Parliament and of the Councilof 19 March 2001, allowing voluntary participation by organizations in a community eco-management and audit scheme (EMAS regulation). For a detailed survey of regulatoryincentives given by EU member states, see http://ec.europa.eu/environment/emas/activities/index_en.htm (accessed 28 May 2009). The EU has recently proposed to revise the EMASscheme, seeking to enhance the incentives given by member states and EU institutions toEMAS companies. See Proposal for a Regulation of the European Parliament and of theCouncil on the Voluntary Participation by Organisations in a Community Eco-Manage-ment and Audit Scheme (EMAS), Brussels, COM(2008) 402, http://ec.europa.eu/environ-ment/emas/pdf/com_2008_402_final.pdf (accessed 28 May 2009).

30 See, e.g., EPA Performance Track program (http://www.epa.gov/perftrac), AlbertaEnviroVista program (http://environment.alberta.ca/867.html), and Ontario Environmen-tal Leaders Program (http://www.ene.gov.on.ca/envision/general/leadership/index.htm) (allaccessed 28 May 2009). EPA decided to halt the Performance Track program on 16 March2009 in order to review its success.


cannot replace the public regulation system.31 They should also behighly selective in their design and the domain to which they areapplied.32 Further, self-regulatory schemes should also containmechanisms that will discourage strategic manipulation of thescheme by participating firms (e.g., joining the proposed ISO14001 scheme in order to gain regulatory rewards, but without agenuine commitment to implement the ISO 14001 EMS).

A program encouraging firms to adopt ISO 14001 shouldtherefore include elements responding to these concerns. A properregulatory response should be based, we suggest, on the followingthree pillars: a requirement to publish an annual environmentalstatement (preferably according to the Global Reporting InitiativeSustainability Reporting Guidelines), a requirement to engage inmeaningful internal and external dialogue, and the developmentof closer cooperation between national regulators and national ac-creditation bodies in supervising the work of EMS auditors.33 Thisthreefold strategy should both provide an incentive for organiza-tions to incorporate more demanding environmental goals andstrengthen the monitoring and reflexive components of the ISO14001 system (reducing the capacity of firms to use ISO 14001 as amere ‘‘green wash’’ instrument). The advantage of this strategy isthat it does not interfere directly with the decisional autonomy ofcertified firms, remaining faithful to the ISO 14001 self-regulatoryspirit. The EMAS scheme includes several components that re-spond to these concerns and could therefore serve as a template forother environmental regulators.34

31 We do not suggest in that context that ISO 14001 can replace the public regulatoryframework. This view was shared by many of the managers we interviewed, reflecting, so itseems, a concern that without regulation, their competitors may lower their environmentalstandards so much that their environmentally friendly companies will not survive in themarketplace. Public regulation thus provides the important function of setting a ‘‘regu-latory floor’’ for the entire industry.

32 In this context the literature has been doubtful, for example, with respect to theefficacy of other EMSs, and our recommendations are limited therefore to ISO 14001. See,e.g., the King and Lenox study of Responsible Care (2000), the Welch, Mazur, andBretschneider study of the U.S. Department of Energy CO2 program (2000), the Riveraet al. study of the Sustainable Slopes Program (2006), and Darnall and Sides (2008).

33 For a review of the U.S. National Accreditation Program and constructive sugges-tions on how to improve it, see Andrews (2001).

34 Thus, for example, EMAS requires participating organizations to engage in anopen dialogue with the public (Art. 1(2)(c), Annex B, Section 3, EMAS Regulation 2001), topublish an annual Environmental Statement (Art. 3.2(c)(e), Annex III, EMAS Regulation2001), and to develop a framework for employee participation (Section 4, appendix B,EMAS Regulation 2001). The European Commission’s recent revision proposal attempts tofurther improve the EMAS scheme in these contexts by proposing to harmonize the rulesfor accreditation and verification and to reinforce environmental reporting requirements,drawing on newly developed core performance indicators and sectoral reference docu-ments. The EPA Performance Track program includes similar requirements; see http://www.epa.gov/perftrac/program/index.htm (accessed 28 May 2009).


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Statute Cited

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Oren Perez is an Assistant Professor at Bar Ilan University Faculty of Law,Israel. He received his Ph.D. from the London School of Economics andPolitical Science. His research focuses on environmental law and policy,globalization, legal pluralism and legal theory. He has published two books:Ecological Sensitivity and Global Legal Pluralism: Rethinking theTrade and Environment Conflict (Hart Publishing, 2004) andParadoxes and Inconsistencies in Law (co-edited with GuntherTeubner, Hart Publishing, 2006). He has published widely on topicsrelated to environmental law and policy, the risks of novel technologies, e-democracy, and legal theory.

Yair Amichai-Hamburger is the director of the Research Center forInternet Psychology (CIP), Sammy Ofer School of Communications,Interdisciplinary Center, Herzliya. He received his Ph.D. from OxfordUniversity. His research interests include Internet use and well-being,virtual teams, intergroup contact on the Internet, and leadership andmotivation. His first book, The Social Net, Human Behavior inCyberspace, was published by Oxford University Press in 2005, and hissecond book, Technology and Wellbeing, is to be published by Cambridge


University Press in 2009. He is presently working on several internationalprojects with a special focus on the impact of technology on our well-being.

Tammy Shterental has an M.A. in experimental psychology from Bar IlanUniversity. Her research focuses on institutional and psychological aspectsof organizational behavior.



Documents

The Dynamic of Corporate Self-Regulation: ISO 14001, Environmental Commitment, and Organizational Citizenship Behavior