Skip to main content
Log in

The impact of environmental practices on firms’ efficiency: the case of ICT-producing sectors

  • Original Paper
  • Published:
Operational Research Aims and scope Submit manuscript

Abstract

The aim of this paper is to shed light on the debate concerning the impact of environmental practices on firms’ efficiency. It focuses on two of the most representative sectors of information and communication technologies’ industry, i.e. computer hardware and telecommunications equipment. The Data Envelopment Analysis (DEA) method was chosen to measure firm-level efficiency, since we are interested in the relative evaluation of a firm with respect to all other firms in a given set. The methodology is based on a three-stage approach: (1) construct an appropriate efficiency ratio, (2) divide the sampled companies into two discrete categories, i.e. the companies with more restrictive environmental practices (adherence to specific standards) and those with less restrictive practices (adoption of a general framework), and (3) calculate DEA efficiency scores. According to our findings, ICT companies which implement strict environmental practices are not necessarily more efficient than their rivals. Consequently, except for the case of compulsory regulations, ICT companies should consider all the possibilities and implement the practices best suited to their needs.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others

References

  • Ahn T, Charnes A, Cooper WW (1988) Efficiency characterizations in different DEA models. Socioecon Plann Sci 22(6):253–257

    Article  Google Scholar 

  • Banker RD, Charnes A, Cooper WW (1984) Some models for estimating technical and scale inefficiencies in Data Envelopment Analysis. Manage Sci 30:1078–1092

    Article  Google Scholar 

  • Charnes A, Cooper WW, Rhodes E (1978) Measuring the efficiency of decision making units. Eur J Oper Res 2:429–444

    Article  Google Scholar 

  • Charnes A, Cooper WW, Lewin AY, Seiford LM (1996) Data Envelopment Analysis, theory, methodology and applications. Kluwer, Dordrecht

    Google Scholar 

  • Coelli TJ, Prasada Rao DS, O’Donnell CJ, Battese GE (2005) An introduction to efficiency and productivity analysis, 2nd edn. Springer Science Business Media, New York

    Google Scholar 

  • Cooper WW, Seiford LM, Tone K (2007) Data Envelopment Analysis, a comprehensive text with models, applications, references and DEA-solver software, 2nd edn. Springer Science Business Media, New York

    Google Scholar 

  • Erdmann L, Würtenberger F (2003) The future impact of ICT on environmental sustainability: identification and global description of economic sectors. Institute for Prospective Technological Studies. Seville. Available at: http://fiste.jrc.ec.europa.eu/download/interim_report_1_final.pdf

  • Eurostat (2007) R&D industrial investment scoreboard. Available at: http://epp.eurostat.ec.europa.eu/portal/page?_pageid=2993,65015306&_dad=portal&_schema=PORTAL

  • Fuchs M (2004) Strategy development in tourism destinations: a DEA approach. Poznan Univ Econ Rev 4(1):52–73

    Google Scholar 

  • Gabel HL, Sinclair-Desgagné R (2001) The firm, its procedures and win-win environmental regulations. In: Folmer H, Gabel HL, Gerking S, Rose A (eds) Frontiers of environmental economics. Edward Elgar, Northampton, pp 148–175

    Google Scholar 

  • ISO (2004) ISO 14001. Available at: http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=31807

  • EU Parliament and EU Council (2002) Directive 2002/96/EC on the waste electrical and electronic equipment directive. Available at: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:037:0024:0038:EN:PDF

  • EU Parliament and EU Council (2003) Directive 2002/95/EC on the restriction of the use of certain hazardous substances in electrical and electronic equipment. Available at: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:037:0019:0023:EN:PDF

  • Plepys A (2002) The grey side of ICT. Environ impact assess rev 22:509–523

    Article  Google Scholar 

  • Popp D (2006) International innovation and diffusion of air pollution control technologies: the effects of NOX and SO2 regulation in the US, Japan, and Germany. J Environ Econ Manage 51(1):46–71

    Article  Google Scholar 

  • Porter M, Van der Linde C (1995) Green and competitive: ending the stalemate. Harv Bus Rev 73:120–137

    Google Scholar 

  • Raab RA, Kotamraju P (2006) The efficiency of the high-tech economy: conventional development indexes versus a performance index. J Reg Sci 46(3):545–562

    Article  Google Scholar 

  • Reisch LA (2001) The Internet and sustainable consumption: perspectives on a Janus face. J Consum Policy 24(3/4):251–286

    Article  Google Scholar 

  • Sarkis J, Cordeiro JJ (2001) An empirical evaluation of environmental efficiencies and firm performance: pollution prevention versus end-of-pipe practice. Eur J Oper Res 135:102–113

    Article  Google Scholar 

  • Seiford LM, Zhu J (2002) Modelling undesirable factors in efficiency evaluation. Eur J Oper Res 142:16–20

    Article  Google Scholar 

  • Tone K (2001) A slacks-based measure of efficiency in Data Envelopment Analysis. Eur J Oper Res 130:498–509

    Article  Google Scholar 

  • Van der Vlist AJ, Withagen C, Folmer H (2007) Technical efficiency under alternative environmental regulatory regimes: the case of Dutch horticulture. Ecol Econ 63(1):165–173

    Article  Google Scholar 

  • Whitelaw K (2004) ISO 14001 environmental systems handbook, 2nd edn. Elsevier, Amsterdam

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Emmanouil Stiakakis.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Stiakakis, E., Fouliras, P. The impact of environmental practices on firms’ efficiency: the case of ICT-producing sectors. Oper Res Int J 9, 311–328 (2009). https://doi.org/10.1007/s12351-009-0035-9

Download citation

  • Received:

  • Revised:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s12351-009-0035-9

Keywords

Navigation