Commentary on ‘corporate strategies and environmental regulations: an organizing framework’ by A. M. Rugman and A. Verbeke

A significant issue that is increasingly affecting the operations of companies is the policies of governments with regard to the natural environment and the activities of nongovernmental organizations in promoting codes of practice and other forms of nonlegal regulation.1 The onset of new regulations and codes of conduct is placing significant operational burdens on firms to merely comply with new requirements and changed circumstances. Furthermore, there is a need in strategic terms to anticipate and to plan for environmental concerns and to incorporate this thinking into corporate strategy. Thus a new subfield of strategic management is beginning to emerge: that dealing with the natural environment as it affects corporate strategy. Alan Rugman and Alain Verbeke in their paper ‘Corporate strategies and environmental regulations’ organize the literature on environmental regulations and corporate strategy into a new managerial framework. They go on to develop a resource-based view of the interaction between the firm's key resources (core competences) and environmental regulations including the implications for the development of ‘green’ capabilities. Finally, they analyze the deployment of ‘green’ capabilities within a standard international business model and explore hypotheses on the relationships between environmental regulations, competitiveness, and corporate strategy. The question about how firms should respond to environmental regulations can be seen in broad terms as part of the debate on corporate social responsibility. A fundamental problem in this area has been that there are no definitions of corporate social responsibility or corporate social responsiveness that provide a framework or a model for consistent systematic collection, organization, and analysis of corporate data relating to these important concepts (Clarkson, 1995). © 1998 John Wiley & Sons, Ltd.

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