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The name Volvo is considered by many to be synonymous with safety. In recent years, the company has undertaken a coordinated effort to expand that image to improve environmental performance as a strong point for their products. This case details the motivation behind that effort, outlines the steps taken to improve Volvo's environmental management, and evaluates its success to date. / The International Motor Vehicle Program at MIT

This research investigated the general association between corporate environmental performance and the firms’ annual returns independent of any particular environmental event. The association analysis was based on the most recent environmental data for the years 2006, 2007, and 2008. The results indicated that while some environmental variables were significantly associated with firms’ returns, the majority were not. The results also indicated that environmental concerns were more likely to be associated with increase in the firm value than were environmental strengths; however, there were no mean differences between firms whose environmental performance increased as compared with those whose performance deteriorated. Overall, the results provided support for the perspective that environmental strengths require firm expenditures that place additional financial burdens on firms, resulting in lower stock returns.

Traditional manufacturing industry have developed a linear production path that involves resource extraction, energy usage, emissions released to air and water, and waste produced at volumes and rates that places increasing burden on the natural environment. These traditional manufacturing organizations have mostly viewed environmental activities separately from their core business operations. Today, organizations are shifting their manufacturing approach. There is a significant potential to reduce the energy use, emissions released, resource consumption and wastes produced through sustainable initiatives. Using environmental key performance indicators (KPIs) is one emerging sustainability initiative. Environmental KPIs depict the vast quantity of environmental data of a firm in a comprehensive and concise manner, applying mostly to set absolute material and energy data in relation to other variables in order to increase the informational value of quantitative data. In this thesis work, literature review and empirical study was carried out to find out the significant factors and the major challenges during the development and implementation of environmental key performance indicators (KPIs). A case study in four Swedish manufacturing companies was carried out to collect primary data which was later compared with literature review. The thesis work also highlights the management system used to implement environmental KPIs.

Background: Trends for more sustainable and environmental friendly business practices have transformed many industries, especially Volvo CE as an OEM within heavy vehicle industry, where company needs to continuously innovate and develop environmental sustainability technologies. Volvo CE is trying to balance the cost and profit with environmental impact through engaging in sustainable operations and do it through the optimization of Environmental Performance Management (EPM). There is a need for Volvo CE to improve their whole supply chain throughout the entire tier of suppliers since the suppliers create a major value within company business and Volvo CE need to find the way on how to diffuse the EPM to supplier networks. Also, to control and evaluate the process, Volvo CE is looking for systematic control mechanism to measure and control the practice of EPM. Research questions: 1. How does the environmental regulation in heavy vehicle industry impact the EPM of Volvo CE? 2. How should the EPM be efficiently diffused to the supplier network of Volvo CE? 3. Which are the effective control mechanisms of the EPM on the supplier network of Volvo CE? Purpose: The purpose of this paper is two-fold. Firstly, it aims to identify the impact of environmental regulations has in Volvo CE. Secondly, it is set to analyse the possible ways to efficiently diffused the EPM on the supplier network of Volvo CE and identify control mechanisms for the EPM implementation on the supplier network, from the perspective of Volvo CE. Method: By using Volvo CE as the research object, this study adopts case study method with qualitative approach. The study is conducted in ii Volvo CE perspective where it has an abductive approach with the intention to examine the impact of environmental regulation in EPM of Volvo CE, understand how Volvo CE implement the diffusion back to the supplier network and control the process through EPM. Conclusion: The findings emphasize that the environmental sustainability regulations impact the EPM in Volvo CE are distributed in manufacturing/production, managerial, strategic, technical and compliance area. Volvo CE needs to work a lot with energy efficiencies, material efficiencies and waste reduction management and find the products, which need less energy to produce and environmental friendly. To achieve the efficient of EPM adoption, EPM should perceive to have relative advantage, compatibility, complexity, trialability and observability characteristic. The control mechanism can be built through formal and informal control techniques. Specifically, Volvo CE needs to identify more joint KPI:s with suppliers and include important suppliers in the process. A long-term relationship with an important supplier will alleviate the control of 2:nd and 3:rd tier supplier since the important supplier will have the trust and authority to control, monitor and oversee how they are implementing the environmental aspect in their daily work.

In the context of distinctive international business phenomena of global environmental concern i.e., climate change, this dissertation addresses two research questions. Does multinational enterprise (MNE) orientation (global- or regional-orientation) have an influence on the carbon performance of the multinational? Is there any significant home country effect that drives carbon performance? Stakeholders are increasingly watching the green performance of the firms and investors are looking for information of how firms deal with externalities such as carbon emission. Environmental capabilities are increasingly becoming the core competence of a multinational enterprise. This also enables the MNE to be an active entity and play a key role in global environmental governance. Defining carbon performance as the capability of firms to integrate climate change strategy into the overall strategy, this dissertation used resource-based view and institutional theory as the theoretical framework along with the concept of regionalization of firms. We argue that differences in integrating strategy to reduce carbon emission (carbon performance) are related to MNE orientation and home country effect. Using a sample of 324 firm-years drawn from the carbon disclosure project reports 2011, 2012, and 2013, we analyzed the data running a logistic regression. We found that global-oriented MNEs had better carbon performance compared with regional-oriented MNEs (p This result was against the hypothesized relationship. One of the reasons for this result could be projected good image by the firms in environmentally non-sensitive industries because of cost advantage. Lower environmental institutional distance between home and host country of a firm increased the likelihood of its carbon performance regardless of its orientation as global or regional (p

The trend of green consumerism and increased standardization of environmental regulations has driven multinational corporations (MNCs) to seek standardization of environmental practices or at least seek to be associated with such behavior. In fact, many firms are seeking to free ride on this global green movement, without having the actual ecological footprint to substantiate their environmental claims. While scholars have articulated the benefits from such optimization of uniform global green operations, the challenges for MNCs to control and implement such operations are understudied. For firms to translate environmental commitment to actual performance, the obstacles are substantial, particularly for the MNC. This is attributed to headquarters’ (HQ) control challenges (1) in managing core elements of the corporate environmental management (CEM) process and specifically matching verbal commitment and policy with ecological performance and by (2) the fact that the MNC operates in multiple markets and the HQ is required to implement policy across complex subsidiary networks consisting of diverse and distant units. Drawing from the literature on HQ challenges of MNC management and control, this study examines (1) how core components of the CEM process impact optimization of global environmental performance (GEP) and then uses network theory to examine how (2) a subsidiary network’s dimensions can present challenges to the implementation of green management policies. It presents a framework for CEM which includes (1) MNCs’ Verbal environmental commitment, (2) green policy Management which guides standards for operations, (3) actual environmental Performance reflected in a firm’s ecological footprint and (4) corporate environmental Reputation (VMPR). Then it explains how an MNC’s key subsidiary network dimensions (density, diversity, and dispersion) create challenges that hinder the relationship between green policy management and actual environmental performance. It combines content analysis, multiple regression, and post-hoc hierarchal cluster analysis to study US manufacturing MNCs. The findings support a positive significant effect of verbal environmental commitment and green policy management on actual global environmental performance and environmental reputation, as well as a direct impact of verbal environmental commitment on green policy management. Unexpectedly, network dimensions were not found to moderate the relationship between green management policy and GEP.

Industrin gör att samhället utifrån det ekonomiska system som det verkar i, fungerar. På samma gång står industrin för stora delar av de växthusgasutsläpp som värmer upp jorden och den globala kris som det innebär. Att företag mäter sina utsläpp, jobbar för att sänka de, genomför klimatpositiva åtgärder, klimatanpassar och jobbar förebyggande blir av vikt för att kunna minska på utsläppen såväl globalt som lokalt. Ett företag drivs utifrån olika faktorer så som att vara lönsamma på olika vis. I den här studien, som är ett samarbete med Hagainitiativet, undersöks vad 102 svenska börsnoterade företag anser om sitt klimatarbete och hur det påverkar företagets lönsamhet. Företagen svarar även på hur de menar att politiska beslut och Covid-19-pandemin påverkar deras klimatarbete. Material inhämtades med hjälp av kvantitativ metod, webbenkät.  Studien visar på att företagen över lag ställer sig positiva till att engagera sig i klimatfrågan och menar att klimatarbetet får positiva effekter för företagets lönsamhet. Allra starkast tycks synergin vara mellan klimatarbetet och en positiv effekt för varumärket samt för attraktiviteten som arbetsgivare. När Hagainitiativets enkätsvar från 2019 jämfördes med svaren från denna undersökning i 2021, svarar fler att klimatarbetet får en positiv effekt för företagets lönsamhet och färre att det får en negativ effekt. Det klimatpolitiska läget samt Covid-19 skulle kunna presentera en del av förklaringen till varför.  Resultaten indikerar på att det finns ett flertal frågor som hade varit intressant att ställa framöver för att få mer information om vad företagen gör, vad de inte gör och varför. Att ytterligare fördjupa förståelsen kring de uppfattningar som finns kan vara en del av det som krävs för att bana vägen framåt för företag att kunna jobba för hållbar utveckling och på samma gång uppnå en god lönsamhet. / The industry keeps society spinning in its current system. At the same time, it accounts for large parts of the greenhouse gas emissions which are heating up the earth and is responsible for the global crisis that it entails. Companies measuring their emissions, working to reduce them, implementing climate-positive measures, adapting to climate- change and working preventively is important to reduce emissions both globally and locally. For a company to survive, it runs based on various factors, such as being profitable in different ways. This study, which is a collaboration with the Hagainitiativet, examines what 102 Swedish listed companies think about their climate work and how it affects various profitability aspects of the business. The companies also respond to how they believe that political decisions and the Covid-19 pandemic affect their climate work. Materials were obtained using a quantitative method, web survey.  The study shows that companies in general are positive about getting involved in the climate issue and believe that their responses to climate change result in positive effects on the company's profitability. The synergy seems to be strongest between climate responses and a positive effect on the brand and the attractiveness as an employer. When the questionnaire from Hagainitiativet in 2019 were compared to the responses from this survey in 2021, more companies answered that climate work has a positive effect on the profitability and fewer that it has a negative effect. The climate policy situation and Covid-19 could present part of the explanation for why this is.  The results indicate that there are several questions that would be interesting to ask in the future to get more information about what companies do, what they do not do and why. Further deepening the understanding of existing perceptions, can be part of what is required to pave the way for companies to work for sustainable development and at the same time achieve profitability.

Ce travail de thèse cherche à démontrer qu’une meilleure Performance Environnementale (PE), à travers la mise en place des initiatives éco-innovantes, influence positivement la Performance Financière (PF) d’une entreprise. Comme hypothèse de base, nous avons choisi celui de Porter (1991) qui insiste sur les avantages de la mise en œuvre de stratégies environnementales respectant le principe du développement durable. Cette hypothèse s’oppose totalement à la vision néoclassique qui considère les coûts de protection de l’environnement comme des coûts supplémentaires et excessifs susceptibles de freiner le développement économique de l’entreprise. Pour valider notre hypothèse de recherche, nous avons choisi de tester économétriquement, moyennant la méthode de la régression linéaire, la relation entre la PE et la PF en choisissant comme indicateur de PE le montant des investissements et des dépenses environnementaux (IE), le pourcentage de fibres certifiées (FC) ainsi que les indices «Valeur Durable»Environnement , relatifs à chacune des ressources environnementales. Ces indices sont calculés selon l’approche « Sustainable Value » destinée à évaluer la contribution des entreprises à la durabilité et qui représente une application du raisonnement de l’analyse financière classique aux ressources environnementales. On a choisi de mener cette étude dans une perspective statique et dynamique dans le but d’évaluer les effets de la PE sur la PF à court et à moyen terme, en évaluant et l’effet courant de la PE et son effet retardé d’une et de deux années sur la PF. Les résultats ainsi dégagés à partir de cette étude économétrique ont fourni une validation de notre hypothèse principale de recherche, stipulant qu’une bonne PE influence positivement la PF et la rentabilité des entreprises. Nous constatons que, les efforts et les initiatives environnementaux sont profitables dès la première année de leur mise en place sauf que l’intensité de ce profit varie selon la nature de l’éco-innovation (éco-innovation produit, éco-innovation procédé) et selon les caractéristiques propres à chacune des entreprises. / This thesis seeks to demonstrate that improved Environmental Performance (EP), through the implementation of eco-innovative initiatives , positively influences Financial Performance ( FP) of a company. As basic hypothesis, we chose that of Porter ( 1991), which emphasizes the benefits of implementing environmental strategies respecting the principle of sustainable development. This hypothesis is totally opposed to the neoclassical vision that considers the costs of environmental protection as additional and excessive costs that may hamper the company's economic development. To validate our research hypothesis , we chose to test econometrically , through the method of linear regression, the relationship between EP and FP choosing as EP indicators, environmental investments and expenses (IE), the percentage of certified fiber (CF) and the "Sustainable Value"Environment indexes, relative to each of the environmental resources. These indexes are calculated using the approach "Sustainable Value" destined to evaluate the corporate sustainability and who represents an application of reasoning of classical financial analysis to environmental resources. We chose to conduct this study in a static and dynamic perspectives in order to assess the effects of EP on FP in a short and a medium term, through the evaluation of both the current effect and the one and two years delayed effect of the EP in FP. The results thus released from the econometric study provided a validation of our main research hypothesis , stating that a good EP influence positively the FP and the profitability of the Company.We note that the environmental initiatives are profitable since the first year of their implementation, except that the intensity of this profit varies according to the nature of Eco-innovation (Eco-innovation product, Eco-innovation process) and according to the characteristics of each company.

This study was aimed at understanding the environmental performance of two abrasives, coal slag and garnet which are commonly used by shipyards and many other industries in surface preparation of metallic surfaces. Environmental performance evaluated in this study included, (1) productivity (ft2/hr), (2) consumption and or used-abrasive generation rate (ton/2000 ft2; lb/ ft2), (3) particulate emission factors (mg/ft2; mg/lb; lb/lb; lb/kg; lb/ton). In order to achieve the study objectives, an emission test facility was built and necessary equipment and materials were procured. Blasting was performed on rusted steel panels inside the test facility and emissions were measured using EPA Source Test Method to quantify particulate emissions. By measuring the area cleaned, blasting time, and the abrasive consumed, environmental performance of coal slag and garnet was evaluated. Simple mathematical models were developed to predict performance based on feed rate and blast pressure. Garnet was observed to be more productive, less consuming, and more environmentally-friendly compared to coal slag. These study findings will valuable in reducing costs, improving productivity, and protecting the environment.