Issue #2 (Volume 15 2024)

Considering continuing environmental degradation linked to economic activity, it seems essential to examine the role companies can play in implementing sustainable development. This study aims to analyze lessons learned from standard theories on the effectiveness of corporate social and environmental responsibility. Indeed, corporate social responsibility and state intervention are frequently compared under the dual lens of collective well-being and environmental quality. For some economists, corporate social responsibility is preferable to state intervention from the point of view of maximizing collective well-being. By contrast, according to some other authors, state intervention is more effective for both maximizing well-being and protecting the environment. This literature review shows that corporate social responsibility is theoretically no more effective than public intervention in environmental protection: companies can be encouraged to commit themselves to protecting the environment under restrictive conditions, but this does not eliminate the essential importance of public intervention. Analysis of the assumptions of neoclassical models shows that, in reality, they do not take into account all the properties of a public good, i.e., all the properties of the climate and the environment. Finally, the conditions for implementing CSR are incompatible with maximizing collective well-being, which explains why public intervention is theoretically preferable to CSR.

Implementing eco-control is a strategic way for companies to prevent environmental damage. This paper aims to analyze the effect of perceived environmental uncertainty and stakeholder pressure on system implementation through environmentally oriented organizational culture as a mediating variable. This study utilizes the PLS-SEM model using a sample of 104 manufacturing companies in Indonesia; 197 respondents from those companies completed the survey. All variables used in the research model are significant for a formative measurement model, and an internal model applied met all criteria. This study confirms a negative relationship between perceptions of environmental uncertainty and environmentally oriented organizational culture (β = 0.174, p < 0.01). The opposite effect is shown by the relationship between stakeholder pressure and organizational culture (β = 0.379, p < 0.01), and the positive effect of organizational culture on the implementation of eco-control in companies is significant (β = 0.650, p < 0.01). In addition, organizational culture partially mediates the relationship between perceptions of environmental uncertainty and the implementation of the eco-control system (β = 0.317, p < 0.05) and between stakeholder pressure and the implementation of this system (β = 0.401, p < 0.05). When companies through managers face uncertainty from the ecological environment and stakeholder pressure, they should utilize an eco-control system, which can succeed in profit goals and environmental responsibility.