Do Green Businesses Benefit Communities?

Date of Original Version



Working Paper

Abstract or Description

This paper examines whether green businesses extend the basic lessons and benefits of advanced environmental management systems to communities. We advance the basic hypothesis that there is considerable spillover benefit between environmental practices that lead to performance gains inside the organization and those that confer benefits to the external community. Our underlying theory is that organizations that have realized improvements in their own, internal industrial and environmental performance are likely to seek to extend these advanced practices across the factory gates to include their relationships with and impacts upon local communities. To test this hypothesis, a survey of manufacturing establishments was conducted.

The findings of the research confirm the hypothesis. There appears to be considerable overlap in the practices that are the source of both environmental performance improvement inside the plant and of reduced environmental risks to communities. The findings indicate that companies with advanced environmental practices are significantly more likely to share information with community groups and obtain input from community and environmental groups in their environmental decision-making and priority setting. Advanced plants also pose less environmental risk and generate more significant community environmental benefits than plants without such programs.