An analysis of environmental management, organizational context and performance of Spanish hotels
Introduction
The degradation of the environment constitutes a main concern of modern society, and this in turn affects firms’ strategy. Industries affect the environment differently and, arguably, each sector may have deployed different strategies to tackle environmental issues [1]. Investigations addressing the responses of firms to environmental concerns have overwhelmingly focused on the manufacturing industry [2]. Surprisingly, however, service firms, “the silent destroyers of the environment” [3] have attracted much less research attention. As a service industry, the tourist sector is particularly interesting as the focus of an investigation on environmental management practices for two main reasons. First, this sector has an increasing economic importance [4], [5]. Second, the tourist industry shows an increasingly higher environmental concern [4]. Such distinctive characteristics of the tourist industry are especially dominant in Spain, where this industry generates 11.1% of the Gross National Product [5]. The tourist industry involves two main activities, namely: accommodation and transportation. In this study, we focus on the accommodation sub-sector for both its outstanding role in the offer of tourist services and for its impact on the environment.
This paper studies the driving factors for hotels to deploy environmental management practices. Our review of the extant literature on environmental management determinants lead us to identify a number of factors that have exerted a considerable impact on such practices: age of facilities, size, chain affiliation, stakeholder environmental pressure, and the use of operations management techniques [6], [7]. Additionally, we have found a number of factors pertinent to the hotel industry that affects environmental management practices, including hotels’ legal category and type of dominant tourism among hotels’ clientele. In addition to exploring such driving factors of environmental management practices, we study the extent to which the deployment of such practices exerts a positive impact on firms’ financial performance.
Our study is structured as follows. First, we review the extant literature on environmental management, focusing on those investigations addressing the hotel industry. We then outline the factors that may influence corporate environmental management and the eventual relationship between such practices and firms’ financial performance. Such discussion leads us to a number of hypotheses. Our empirical investigation is shown in due course and addresses the extent to which our findings show support for our hypotheses. Lastly, the results are discussed and some suggestions for future research are posed.
Section snippets
Corporate environmental management and strategy
Corporate environmental management embraces both technical and organizational activities aimed at reducing the environmental negative impact caused by firms’ operations [8]. Environmental management activities may be classified as “technical or hardware” and “organizational or software” [6], [8], [9]. The former aim at the straight reduction of firms’ pollution output (e.g., modifications in the physical characteristics of the product, or changes in the machinery used to reduce the firms’
Hotel environmental management
As noted above, the absence of environmental regulation addressing the hotel industry lead us to focus on other external mechanisms, such as pressures from stakeholders, as the driving factors of environmental management practices [22], [28], [29]. Furthermore, these practices may be affected by variables such as operations management techniques and methods [30], [31] and the age of hotels’ facilities [32]. We also study the effect of firms’ size on our dependent variable as long as size may
Corporate environmental strategy and firms’ performance
Implementation of corporate environmental strategies tightens organizational boundaries. Restrictions to firms’ behavior may arise from the enactment of internal procedures as well as from conformity with extant regulation. Further, compliance with internal and external procedures posits considerable restrictions to opportunistic behavior of firms as well as increase operational costs, and this in turn has a negative impact on firms’ financial performance [26], [62].
On the other hand,
Sample
A first survey was conducted in November 1998. It targeted the entire population of Spanish 3-, 4- and 5-star hotels. The closing date for replies was February 15, 1999. At that time, we received 168 questionnaires and proceeded with a second survey to establishments, which either did not complete the questionnaire or did not identify themselves. The closing date for reception of the questionnaires was April 8, 1999 and that made a total number of 304 replies. No significant differences were
Results
Table 3 shows means, standard deviations, and correlations for all variables. As noted above, hierarchical multiple regression analysis models used environmental management as the dependent variable. Such models tested for the effects of facility age (Hypothesis 1), size (Hypothesis 2), chain affiliation (Hypothesis 3), environmental pressures from stakeholders (Hypothesis 4), and operations management (Hypothesis 5) on environmental management practices. Our control variables encompassed hotel
Discussion of the results
The results support our hypotheses on the determinants of hotel environmental management. Further, we have also found significant differences between the financial performance of active environmental management hotels and their counterparts with a low profile in environmental management practices.
Our findings suggest that the age of hotels’ facilities negatively influence the deployment of environmental management practices, that is, hotels with old facilities put in place less extensive
Acknowledgements
We wish to thank Salvador Carmona and the three anonymous reviewers for the substantial improvements in our manuscript resulting from their suggestions. This research was partially funded through DGES aids (references PB97-1358, PB97-0089 and PR95-583).
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