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Constructing the License to Operate: Internal Factors and their Influence on Corporate Environmental Decisions Jennifer A. Howard-Grenville, Boston University Department of Organizational Behavior Jennifer Nash, Harvard University John F. Kennedy School of Government Cary Coglianese, Univ of Penn Law School Download the Paper (PDF format) - September 12, 2007 Tell a colleague about it. Printing Tips: Select 'print as image' in the Acrobat print dialog if you have trouble printing. ABSTRACT: Voluntary programs intended to improve corporate environmental practices have proliferated in recent years. Why some businesses choose to participate in such voluntary programs, while others do not, remains an open question. Recent work suggests that companies’ environmental practices, including their decisions to participate in voluntary programs, are shaped by a license to operate comprised of social, regulatory, and economic pressures. Although these external factors do matter, by themselves they only partially explain business decision making, since facilities subject to similar external factors often behave differently. In this article, we draw from organizational theory to explain why we would expect a company’s license to operate to be ultimately constructed by internal factors, such as managerial incentives, organizational culture, and organizational identity, as these shape both interpretations of the external pressures and organizational responses to them. Using qualitative data from an exploratory study of matched facilities that reached different decisions about participating in a prominent voluntary environmental program, we then report evidence indicative of the role of these internal factors in shaping facilities’ environmental decisions. Finally, we offer suggestions for future research that could further develop understanding of how internal organizational characteristics influence environmental management decisions, including those concerning participation in voluntary programs. SUGGESTED CITATION: Jennifer A. Howard-Grenville, Jennifer Nash, and Cary Coglianese, "Constructing the License to Operate: Internal Factors and their Influence on Corporate Environmental Decisions" (September 12, 2007). University of Pennsylvania Law School. Scholarship at Penn Law. Paper 105. http://lsr.nellco.org/upenn/wps/papers/105 | REPOSITORY HOME  | SEARCH  | MY ACCOUNT  | NELLCO HOME | Powered by bepress.