Management of Environmental Quality: An International Journal

ISO 14001 in a corporate sustainability context: a multiple case study approach

Matjaž Maletic Manja Podpečan Damjan Maletic
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Matjaž Maletic Manja Podpečan Damjan Maletic , (2015),"ISO 14001 in a corporate sustainability
context: a multiple case study approach", Management of Environmental Quality: An International
Journal, Vol. 26 Iss 6 pp. 872 - 890
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MEQ
26,6
ISO 14001 in a corporate
sustainability context: a multiple
case study approach
872 Matjaž Maletič, Manja Podpečan and Damjan Maletič
Faculty of Organizational Sciences, University of Maribor, Kranj, Slovenia

Abstract
Purpose – The purpose of this paper is to investigate the mechanisms through which ISO 14001 can
contribute to the corporate sustainability. In this regard, the paper examines the underlying theoretical
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concepts and discusses the ISO 14001 in the context of the corporate sustainability. Additionally, the
paper discusses the benefits of ISO 14001 from the perspective of the triple bottom line.
Design/methodology/approach – The paper uses a multiple case study approach focusing on four
ISO 14001-certified Slovenian organizations and two non-ISO 14001-certified organizations. The data
collection methods included semi-structured questionnaire and interviews with managers in all studied
organizations.
Findings – It is suggested that the motives could be perceived as explanatory variables of the benefits
realized from ISO 14001 certification. Further, the findings of this study indicate that environmental
management system should be seen in a wider perspective that includes elements such as quality and
social responsibility. Moreover, the results also lead us to the suggestion that there could be a
reciprocal causal mechanism linking the environmental performance and economic performance.
Practical implications – ISO 14001 can be an effective tool for pursuing sustainable development;
however, organizations should move a step beyond ISO 14001’s environmental focus and recognize a
multidimensional perspective by simultaneously addressing environmental, quality and social
responsibility issues.
Originality/value – The paper contributes to the corporate sustainability literature by investigating
the mechanisms through which organizations can shift to more sustainable patterns using the ISO 14001.
Keywords Quality, Performance, Corporate sustainability, Motives, ISO 14001
Paper type Case study

1. Introduction
In response to the emerging interest in organizations’ ecological responsibility (Koo
et al., 2014), several initiatives have gained attention in terms of improving corporate
sustainability performance. Environmental management system (EMS) has emerged as
an important topic and element in addressing corporate sustainability (Prajogo et al.,
2012; Zobel, 2013). The growing importance of EMS is driven mainly by searching the
ways to improve control, to reduce the environmental impact of organizations’
activities, to save costs, to improve efficiency, to improve relations with stakeholders, to
improve organization’s image as well as to ensure regulatory compliance (Poksinska
et al., 2003; Prajogo et al., 2012). Considering the frameworks for an EMS, ISO 14001 has
become the most popular and frequently used system and mechanism to manage
the organization’s interaction with the environment (González-Benito et al., 2011).
The usefulness of EMS as a tool to manage environmental issues has stimulated prior
research dealing with the question whether ISO 14001 can lead to environmental
Management of Environmental
Quality: An International Journal performance (Nawrocka and Parker, 2009) or whether the standard can contribute to
Vol. 26 No. 6, 2015
pp. 872-890
sustainable development (Sebhatu and Enquist, 2007). Therefore, given the high level
© Emerald Group Publishing Limited
1477-7835
of prevalence of ISO 14001, and the fact that the standard can provide several tangible
DOI 10.1108/MEQ-08-2014-0129 and intangible benefits (Zutshi and Sohal, 2004), the question arises whether the
 deployment of the standard can effectively support the organizations to systematically ISO 14001
address the principles of sustainable development? in a corporate
Prior empirical literature on corporate environmentalism and corporate
contributions to sustainability was dominated by the studies that examine the link
sustainability
between environmental and economic performance (e.g. Wagner and Schaltegger,
2004) as well as between sustainable performance and economic performance
(e.g. Wagner, 2010). Regarding the ISO 14001, Sebhatu and Enquist (2007) elaborate 873
that the standard contributes to the sustainable development mainly by ensuring a
systematic way of supporting the organizations to manage the short and long-term
impacts of their products, services and processes on the environment. Further,
several prior studies have studied the benefits that can be obtained from successfully
implemented standard (Prajogo et al., 2012; Poksinska et al., 2003). For instance,
Nga (2009) argues that the standard can be conceived as a strategic tool which can
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support the organizations to improve corporate image and to gain competitive

advantage. Majority of these prior empirical studies revealed that environmental
practices explain a part of the variance in organizational performance, but some
studies also suggest that the relationship between environmental practices and
business performance could be inverse (e.g. González-Benito and González-Benito,
2005). Despite the valuable contributions delivered by these studies, Sebhatu
and Enquist (2007) argued that there is still a lack of qualitative studies that
would investigate the mechanisms through which ISO 14001 can contribute to the
organizational changes related to the sustainable development. This area has been
addressed before but has not drawn as much attention as many other phenomena
associated with ISO 14001 such as the diffusion of ISO 14001 (Casadesus et al., 2008;
Marimon et al., 2011; To and Lee, 2014) and the synergistic effect between ISO 14001
and other standards (Simon et al., 2012; To et al., 2012). Drawing upon prior literature
(e.g. Psomas et al., 2011), one can argue that ISO 14001 could provide mechanisms
through which organizations are capable of shifting towards sustainability. However,
prior empirical studies that investigated the benefits of an EMS in accordance to
ISO 14001 did not deliver clear answers and a holistic perspective regarding the
inter-relationship between ISO 14001 and the triple bottom line (TBL). In this regard,
prior case studies (Chiarini, 2013; Sebhatu and Enquist, 2007; Fortuński, 2008)
delineated this research stream and opened opportunities for future research
directions. Accordingly, this paper represents an attempt to contribute to the discussion
on corporate sustainability with a focus on ISO 14001 related benefits.

2. Motives and corporate benefits of the ISO 14001 adoption

2.1 Motives for implementing environmentally sustainable practices
Several internal and external motives can be identified as an important decision drivers
for organizational adoption of EMS or pursuing sustainability practices. The most
frequently stressed motives are:
• meeting customer and stakeholder demands (Castka and Prajogo, 2013; Prajogo
et al., 2012; Poksinska et al., 2003);
• attracting new customers and developing new markets through sustainability
initiatives (Fairfield et al., 2011);
• institutional pressures (Prajogo et al., 2012; Psomas et al., 2011; Zutshi and Sohal,
2004; Bansal and Bogner, 2002);
 •
MEQ seeking cost reduction and efficiency improvement (Prajogo et al., 2012; Iraldo
26,6 et al., 2009; Zutshi and Sohal, 2004; Poksinska et al., 2003);
• searching for competitive advantages (Psomas et al., 2011; Zutshi and Sohal,
2004; Poksinska et al., 2003; Bansal and Bogner, 2002); and
• improving innovation capabilities (Iraldo et al., 2009; Wagner, 2008).
874 Recent studies have brought to the forefront the question whether the pressure from
stakeholders can stimulate the adoption of ISO 14001 which can ultimately lead to the
performance benefits (e.g. Castka and Prajogo, 2013). For instance, the findings of prior
studies suggest that organizations pursuing ISO 14001 certification in response to
pressure from secondary stakeholders are focused on the value which is obtained
through reputation as a result of organization’s engagement in the environmental
initiative (Castka and Prajogo, 2013). With various underlying organizational motives
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for the adoption ISO 14001, this raises the research question whether the TBL benefits
are linked to the underlying organizational motives for EMS adoption (Gavronski et al.,
2008; Prajogo et al., 2012):
RQ1. How does the interplay between motives for the adoption of ISO 14001 and
TBL take place in the organization?

3. Corporate benefits of the ISO 14001 adoption

Prior studies (e.g. Eiadat et al., 2008; Link and Naveh, 2006) have devoted immense
attention to the question whether environmental practices can bring opportunities and
competitive advantage for the organization. In literature we can find a number of studies
arguing that adopters of ISO 14001-based EMSs have gained external benefits such as
improved image and relations with stakeholders as well as internal benefits associated
with reduced risk and costs (e.g. Castka and Prajogo, 2013; Zutshi and Sohal, 2004). The
arguments regarding the link between ISO 14001 and the three pillars of the corporate
sustainability are further described and discussed in the remainder of this section.

3.1 ISO 14001 and economic performance

The relation between environmental and economic performance has been extensively
investigated in prior theoretical and empirical studies by researchers on corporate and
environmental sustainability (e.g. Wagner and Schaltegger, 2004). According to the
Iraldo et al. (2009), the evidences emerging from prior studies that investigate the benefits
of EMS adoption are not always univocal. One can find a rich body of literature pointing
to a positive relationship between EMS, financial and market performance (Ann et al.,
2006; Gavronski et al., 2008; Nga, 2009; Prajogo et al., 2012). However, some studies
revealed that the proclaimed benefits might sometimes be disconnected to quantifiable
or even real perceived benefits (Ghisellinia and Thurston, 2005). In other words, research
in this area has not been able to find a conclusive answer to the question as to
whether EMSs are useful for improving economic performance. According to the
Heras-Saizarbitoria et al. (2011), the ambiguity of the relationship between ISO 14001
certification and financial performance may be due to the selection-effects where more
profitable firms are more likely to pursue environmental improvements since they have
the available funds to do so. In this regard, scholars have begun to challenge the
assumption of a unidirectional relationship between environmental performance and
financial performance by introducing theoretical arguments for bidirectional causality
(Endrikat et al., 2014; Heras-Saizarbitoria et al., 2011). Somewhat this substantiates the
 assertion of Nawrocka and Parker (2009), who emphasize the need to examine in which ISO 14001
specific circumstances the adoption of EMS influences performance, rather than to in a corporate
examine whether they do so or not.
The above literature background provides the basis for developing the following
sustainability
research questions:
RQ2. Is there a positive interaction between ISO 14001 adoption and the economic
performance? 875
3.2 ISO 14001 and environmental performance
Researchers have been widely interested in whether opportunities and competitive
advantages in a relation to corporate environmentalism exist (e.g. Psomas et al., 2011; Link
and Naveh, 2006). A significant and growing number of studies has attempted to examine
the environmental outcomes of EMSs. Several studies have focused on the impacts of EMS
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to environmental performance (Griffith and Bhutto, 2009; Nawrocka and Parker, 2009;
Perotto et al., 2008; Rasi et al., 2014). The vast majority of the prior studies have reported a
positive impact of ISO 14001, both on environmental and business performance indicators
(De Vries et al., 2012; Poksinska et al., 2003; González-Benito and González-Benito, 2005).
According to De Vries et al. (2012), positive impacts are influenced by the age of the EMS, top
management commitment, employee involvement, employee awareness, internal motivation,
size of the organization, well-defined responsibilities and stakeholder involvement.
However, despite the fact that the organization might show improved performance
after putting an EMS in place, this does not confirm that the improvement was caused
entirely by the EMS (Nawrocka and Parker, 2009). In fact, some empirical studies
revealed even a negative relationship between environmental performance and
economic performance (Wagner et al., 2002). If we are able to show that EMS improves
environmental performance (or not), it would therefore be helpful to examine the
mechanisms that are expected to affect the improvement (Nawrocka and Parker, 2009).
Based on the above literature review, the following research question is formulated:
RQ3. What are the key underlying mechanisms of achieving environmental
performance benefits from the adoption of ISO 14001?
3.3 ISO 14001 and social performance
It is vital for an organization to identify its social aspects in a way which supports or
inhibits the ability of communities and stakeholders to meet their diverse needs and
expectations (MacDonald, 2005). Prior studies have suggested that effective
development and implementation of ISO 14001-based EMS is influenced to a great
extent by social aspects that include employee training and involvement, effective
communication, environmental awareness as well as employee health and well-being
(To and Tang, 2014; Granly and Welo, 2014; Jabbour et al., 2010; Oliveira and Pinheiro,
2009; Fortuński, 2008; Zutshi and Sohal, 2004). Further, scholars have acknowledged
the importance of perceived social benefits that may result from adopting the
ISO 14001, including the improved employee motivation, loyalty and environmental
awareness, improved relationship with society and improved public image (Prajogo
et al., 2012; Psomas et al., 2011; Gavronski et al., 2008).
Drawing upon previous studies (Fortuński, 2008; Sebhatu and Enquist, 2007) that
have investigated the linkages between ISO 14001 and sustainable development aspects,
one can argue that there is a need to further explore the interlinkages among the TBL
performance measures (environmental, social and economic benefits) from the
perspective of the ISO 14001. Indeed, economic performance needs to be accompanied
 MEQ by the minimization of ecological footprints and increased attention to social aspects
26,6 (Lee, 2009). In line with these studies, the following research questions can be formulated:
RQ4. Is there a positive interaction between ISO 14001 adoption and social
performance?
RQ5. What is the inter-relationship among the TBL performance benefits from the
876 adoption of ISO 14001?

4. Research methodology
4.1 Case selection
Multiple case study approach was used in this study to provide insights into the
phenomenon being studied (Yin, 2009). Therefore, the case study was chosen as a way
to undertake a contextual analysis of similar situations in multiple organizations.
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The selection of suitable organizations was predominantly based on what could be

learned in relation to the purpose of the study. Hence, the organizations were
purposefully selected using stratified sampling. The following criteria were primarily
considered in the selection process:
(1) experiences from implementing and deploying the ISO 14001 standard; and
(2) type of the industry – the study is predominantly focused on manufacturing
organizations.
An initial list of ten organizations was identified by an examination of the e-catalogue
which is accessible on the web site of Chamber of Commerce and Industry of
Slovenia. In selecting the initial pool of organizations we sought to find cases from
Savinjsko-Šaleška region where the research project was carried out. A total of six
organizations agreed to participate in the research. The study was limited to these
six case studies because, although the number could have been increased, it became
obvious as the research work was being carried out that increasingly fewer ideas were
being gathered, thus supporting the theoretical saturation phenomena (Yin, 2009).
The selected organizations are well established in the industry where they operate, and
their characteristics were particularly suitable for identifying and explaining the
potential contribution of the ISO 14001 to the TBL. In addition, non-ISO 14001-certified
organizations were included in this study to provide supplementary insights.
Table I shows the main business characteristics of the selected organizations, whose
names have been changed to organization ALPHA, organization BETA, organization
GAMMA, organization DELTA, organization EPSILON and organization ZETA.
As shown in Table I, the study included four ISO 14001-certified organizations and
two non-ISO 14001-certified organizations. ISO 14001-certified organizations have used
the standard ten years for minimum which is considered to be suitable for investigating
the contribution of ISO 14001 to the TBL. According to the literature (Curtis et al., 2000),
one might take into consideration a general agreement that approximately four – ten
case studies would produce credible explanations for the research.

4.2 Methods of data collection and analysis

The main objective of the study is to provide qualitative information on the experiences of
selected organizations in connection with the adoption of ISO 14001 and its linkages to
TBL. Therefore, semi-structured interviews were the major sources for data collection
(Yin, 2009). These interviews were carried out with managers responsible for environmental
matters, quality matters or production management. The interview guide included
 Non-ISO 14001-certified
ISO 14001
ISO 14001-certified organizations organizations in a corporate
Organization Organization Organization Organization Organization Organization sustainability
Organization ALPHA BETA GAMMA DELTA EPSILON ZETA

The use of Yes Yes Yes Yes No No

ISO 14001
Period of 13 years 10 years 10 years 13 years – –
877
using ISO
14001
Type of Manufacturing Service and Manufacturing Manufacturing Water Manufacturing
industry industry manufacturing industry industry supply, waste industry
industry management
and Table I.
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remediation The main

activities characteristics
Size of the over 500 50-250 50-250 over 500 5-50 5-50 of the studied
organization organizations

several themes related to the motives for implementing the standard as well as the potential
benefits considered in the TBL context: environmental performance, social performance
and economic performance. The questionnaire consisted of closed-ended and open-ended
questions (items). Interviewees were asked to rank each statement according to their
perceived degrees of agreement using a Likert scale ranging from 1 to 5. In addition,
open-ended questions were also used to obtain responses from interviewees within their
own unique context. Scales for measuring the motives for adopting ISO 14001 were adopted
from Prajogo et al. (2012), while the scales for measuring sustainability performance were
adopted from Maletič (2013). Consequently, mean scores were calculated from the scale’s
items to generate the composite scores for each of the studied dimension (i.e. motives and
TBL performance measures). In the results section, composite scores values were recoded
into the symbols regarding the following criteria: number of check mark symbols
corresponds to the degree to which interviewee agreed with the item, where 1 mark means
weak agreement (corresponds to the average value of composite scores below 3), 2 marks
means moderate agreement (corresponds to the average value of composite scores between
3 and 4) and 3 marks means strong agreement corresponds to the average value of
composite scores of 4 and above. Regarding the open-ended questions data analysis started
with open coding of the collected information followed by identifying relevant themes and
linkages to the TBL. Accordingly, the data analysis itself was carried out via an iterative
process that involved analysing the information obtained from field work.
We acknowledge that such a study could be based on more objective TBL
performance measures and preferably not on the interviewees’ perception of changes
in performance outcomes since all perceptual measurements are prone to be biased
(Zobel, 2013; Heras-Saizarbitoria et al., 2011; Nawrocka and Parker, 2009). However, the
use of perceptual measures is deemed appropriate and acceptable and it is used in most
of the sustainability-related studies (e.g. Castka and Prajogo, 2013).

5. Analysis and results

5.1 Motives for adopting ISO 14001
The analysis of the answers in the first part of the questionnaire gave the insights
into the main drivers for ISO 14001 adoption (Table II). The results show that
 MEQ ISO 14001-certified organizations ranked all the motives as very significant. The
26,6 decision on whether or not to implement ISO 14001 involves internal considerations
(e.g. operational efficiency) as well as considerations outside of the organization
(e.g. customer demand, governmental or public pressure). In the case of ALPHA the
primary motive was externally generated; however, internal motive to establish solid
EMS was also strongly emphasized. At DELTA, for example, achieving a certificate
878 was not considered as a primary decision criteria for the adoption of the standard.
The adoption of ISO 14001 and the development of environmental policy was considered
as a basis for organization’s environmental initiatives and programmes:
[…] Management systems help us organize and supervise the obligations deriving from
environmental protection and occupational safety in a systematic way (manager, DELTA).
At GAMMA important motive was manifested through organizations’ commitment to
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build competitive resources mainly by using ISO 14001 as the foundation to design and
implement an effective EMS, with a capability to improve their business. In this
context, the interviewee stated:
[…] The primary motive was to establish a system to effectively manage our environmental
impacts and responsibilities, and to accomplish our environmental policy (manager, GAMMA).
In the case of BETA, the decision to adopt ISO 14001 was primarily based on external
motives. BETA had clear requirements from the customers that they should become
certified. BETA reported that the most important driving force was the risk which is
associated with the customer dissatisfaction and consequently with the reduction of the
market share.
Considering the non-ISO 14001-certified organizations, the internal motive to improve
environmental performance was not considered as very important in pursuing their
sustainability goals. EPSILON and ZETA had very similar conceptions about corporate
sustainability issues. As revealed by the results, the external motives related to the stakeholder
demands were the most important ones. For example, the interviewee in ZETA stated:
[…] Meeting stakeholders’ expectations is essential to shape our future business development.

5.2 Financial and non-financial aspects of business

Our findings suggest that ISO 14001-certified organizations consider ISO 14001 as a
management standard which helps them formalise and structure their environmental
practices and consequently contribute to the continuing goal of economic sustainability
(Table III). In GAMMA, the interviewee noted:
[…] ISO 14001 changed our view of business by recognizing that continuous improvement of
environmental activities can lead to customer satisfaction, productivity, and ultimately sales
growth and higher profitability.

Motives for adopting ISO 14001/Motives for ISO 14001-certified Non-ISO 14001-certified
implementing sustainability practices organizations organizations

Table II. To improve environmental performance ||| ||

Summary of results To meet customer needs and expectations ||| |||
regarding the To comply with environmental policy and legislation ||| |||
motives for ISO To establish environmental management system (EMS) ||| ||
14001 adoption Notes: ||, Moderate agreement; |||, strong agreement
 One of the most explicit internal benefit achieved from the EMS implementation ISO 14001
observed at the DELTA was associated with the quality improvement. Regarding the in a corporate
external benefits, DELTA emphasized superior performance results related to the sales
improvement and increased customer satisfaction.
sustainability
In the case of BETA, the interviewed manager emphasized that ISO 14001 positively
contributes to the organization’s outcomes (i.e. increased market share). As further
observed in the case of BETA, ISO 14001 is considered as an integral part of its 879
management system. ISO 14001 is integrated with ISO 9001 and OHSAS 18001. This
system is essential to them in order to obtain a suitable feedback and to bring together
lessons learnt, sufficient to ascertain how they can improve overall business performance.
Further, BETA reported that integrated view is essential to effectively identify and assess
internal losses and to manage organization’s interactions with stakeholders.
The manager interviewed at ALPHA pointed out a weak increase in profitability as
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well as a weak increase in market share. However, ALPHA operates within a specific
industry where the market is more or less limited.
According to the results, the two non-ISO 14001-certified organizations placed a
high priority on improving the quality of their products and services. The latter was
also stressed by the interviewee at ZETA:
[…] The quality improvement is crucial to improve customer satisfaction (manager, ZETA).

5.3 Environmental aspects of business

According to the results (Table IV), ISO 14001-certified organizations have devoted a
lot of effort to improving energy efficiency and reducing waste. The approach in

ISO 14001-certified Non-ISO 14001-

Financial and non-financial aspects of business organizations certified organizations

Sales growth has increased above industry average ||| ||

during the last 3 years Table III.
Customer satisfaction has increased during the last 3 years || || Summary of
Operative costs have decreased during the last 3 years || | results regarding
The quality of our products and services has been ||| ||| the financial
improved during the last 3 years and non-financial
Notes: ||, Moderate agreement; |||, strong agreement aspects of business

ISO 14001-certified Non-ISO 14001-certified

Environmental performance organizations organizations

The efficiency of the consumption of raw materials has || ||

improved during the last 3 years
The resource consumption (thermal energy, electricity, ||| ||
water) has decreased (e.g. per unit of income, per unit
of production, […]) during the last 3 years
The percentage of recycled materials has increased || || Table IV.
during the last 3 years Summary of results
The waste ratio (e.g. kg per unit of product, kg per ||| || regarding the
employee per year) has decreased during the last 3 years environmental
Notes: ||, Moderate agreement; |||, strong agreement performance
 MEQ GAMMA was initially based on improving environmental awareness of their
26,6 employees, following by establishing a system for systematic identification and
management of environmental aspects. DELTA, for example, developed its own basic
principles of environmental and energetic policy. These principles are shared and
communicated among employees, and are serving as basic expectations for their
supply chain partners. DELTA is also strongly committed to environmentally friendly
880 processes and products. Compliance with environmental directive such as RoHS,
R.E.A.C.H. and WEEE is a part of DELTA’s commitment to maintain its position as
an environmentally friendly company. DELTA is also very successful in achieving
energy efficiency. In prior years DELTA achieved up to 50 per cent of using renewable
energy sources.
In most cases an EMS was perceived as “a documentation system” that depicts how
an organization works. According to the interviewees’ point of view, the EMS creates a
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common language and a common picture for the entire organization. If everybody in
the organization has the same understanding about the organizational processes, this
certainly creates a good base for change and improvement. At ALPHA the continual
improvement process starts with clearly defined objectives, combined with a solid
system to measure performance against those objectives:
[…] We achieve environmental performance by setting clear and real objectives, by
measuring indicators to determine if we are meeting pre-defined objectives, followed by
suitable and timely actions (manager, ALPHA).
In spite of the valuable support regarding the continuous improvement framework, our
results indicate that there is little contribution of the ISO 14001 or guidance on
generating as well as on implementing corporate sustainability strategy. Moreover,
some difficulties were also observed regarding the clarity of guidance on identification
and assessment of environmental aspects and impacts.
As a manufacturer of chemical products (metal surface coatings), organization
ZETA recognizes the importance of environmental protection activities. However, their
main focus is to produce environmentally friendly products:
[…] Considering the environmental protection efforts, I would emphasise the usage of
environmentally friendly water based liquid protective coating paint (manager, ZETA).
It appears that at ZETA they are not using any management system which would be
perceived as a tool for managing the organizational processes from the perspective of
sustainability. Similarly, ETA does not use any systematic tools which would help
them in identifying and improving environmental issues.

5.4 Social aspects of business

The results presented in Table V illustrate that the case organizations have devoted the
majority of their attention to improving health and safety aspects in the workplace.
In the case of BETA, GAMMA, DELTA and ZETA this was considered as a top priority.
At ALPHA and GAMMA there was a prevailing opinion that social performance is
built upon employee awareness, timely and effective internal and external
communication. According to their point of view, identifying a wide array of social
aspects goes a step beyond ISO 14001’s environmental focus. They consider integrated
view on addressing the environmental as well as the quality issues as a way to
maximize expected benefits. The latter means that the environmental issues are not
addressed separately, but rather in congruence with quality issues. The elements that
 ISO 14001-certified Non-ISO 14001-
ISO 14001
Social performance organizations certified organizations in a corporate
|||
sustainability
Health and safety performance has improved during the |||
last 3 years
The employees’ satisfaction has increased during the || |||
last 3 years
The employees’ motivation has increased during the || ||| 881
last 3 years
Employee education and training (man-days || |||
per employee per year) have increased during the Table V.
last 3 years Summary of results
Corporate image has improved during the last 3 years || ||| regarding the
Notes: ||, Moderate agreement; |||, strong agreement social performance
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can be extracted from their approach are “stakeholder focus”, “focus on processes” and
“system perspective”. Similar point of view was observed at DELTA, where
environmental and social responsibility is an integral part of quality policy.
The case of GAMMA showed that without training, commitment, involvement and
shared goals, the EMS will not provide many more benefits than just a paper to show to
stakeholders. In addition, GAMMA has obtained a family friendly enterprise certificate
mainly as a tool to more effectively address social aspects. Additionally, GAMMA
implemented OHSAS 18001 to manage health and safety aspects. GAMMA reported that
they recognize complementary view between ISO 14001 and OHSAS 18001 in a way that
ISO 14001 supports the organization to manage its impact on the external environment,
while OHSAS 18001 helps the organization to manage its internal environment in terms of a
safe and healthy workplace. At GAMMA, management system standards are considered as
organization’s initiatives under the umbrella of the corporate social responsibility movement.
Considering the overall average results, non-ISO 14001-certified organizations
experienced slightly more progress in social performance, especially regarding
employee motivation and satisfaction. Especially, this was observed at ZETA, where
training hours per employee have substantially increased in recent years. Additionally,
motivation programmes were developed and performed, aiming to increase employee
motivation and satisfaction rates. ZETA also significantly increased market
recognition by registering its trademark in the European market.

6. Discussion
The purpose of this research was to increase our understanding of the benefits of
using ISO 14001, with a focus on the TBL as sustainable corporate performance.
Prior literature (e.g. Prajogo et al., 2012: Poksinska et al., 2003) already suggested the
importance of adopting the ISO 14001; however, there is a lack of research that would
provide insights into mechanisms that act as driving forces for achieving desired level
of sustainable development.
Regarding the motives for adopting ISO 14001, our results indicate that apart from
external motives (e.g. stakeholder pressure), ISO 14001-certified organizations shared the
positive attitude about the importance of internal motives as well. When trying to discuss
the mechanisms of why organizations behave in a similar way, one should consider a
institutional perspective, namely, three aspects (DiMaggio and Powell, 1983; Matten
and Moon, 2008): coercive isomorphism, mimetic processes and normative pressures.
 MEQ If ISO 14001 is considered as a tool which drives improvements, it clearly has greater
26,6 opportunities to contribute to the sustainable development in comparison to the
organizations that adopt ISO 14001 merely as coercive pressure which consists of
external pressure established by stakeholders (e.g. customer pressure). Indeed,
organizations that have no intention of improving their environmental performance,
but adopt certificate by the means of seeking legitimacy among external stakeholders,
882 cannot provide a sustainable improvement in environmental management (Guoyou et al.,
2012). The results of our case studies provide some evidence that strong commitment to
sustainability could catalyze the internalization of ISO 14001 in daily practice. In the case
of GAMMA and DELTA, internal motives were strongly emphasized. There is no doubt
that both organizations strive to be frontrunners concerning working actively within
sustainability related issues (at the workplace and the surrounding community). These
organizations also expressed superior results regarding TBL performance measures.
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When it comes to the heterogeneous perspective on internal and external motivation

(e.g. imbalance emphasis on external motives), our results indicate that internalization of
ISO 14001 is rather difficult. These findings are also consistent with prior research
(Heras-Saizarbitoria et al., 2011a) suggesting that organizations that pursue this
ISO 14001 certification for internal reasons obtain greater benefits than those pursuing
it for external reasons. Consistently, our results show that certification for ISO 14001
cannot guarantee any direct improvement in TBL, but the internalizing practices
underlying ISO standards can lead to corporate benefits.
Although our results indicate the difference between ISO 14001-certified
organizations and non-ISO 14001-certified organizations regarding the obtained
benefits, this should be interpreted with caution. For instance, in an empirical study
made by Zobel (2013), results did not provide evidence which would support
statistically significant differences between certified and non-certified firms
regarding the change in environmental performance. Several plausible
explanations could be delivered in this regard. As argued by Zobel (2013) the
difference also depends on the level of environmental performance achieved prior to
adopting ISO 14001. Considering the change in the performance, one might argue that
organizations with poor environmental performance have greater potential to
improve environmental performance than organizations that already have superior
environmental performance. Moreover, it can also be argued that financially
successful organizations may have the resources necessary to improve their
environmental performance, which in turn increases financial benefits (Endrikat et al.,
2014). In this sense, our study contributes to previous literature (e.g. Surroca et al.,
2010) suggesting that there is no direct relationship between environmental and
financial performance, but that there is a virtuous circle connecting both performance
measures through intangibles. This mechanism could also take place in our case
organizations. For example, DELTA is widely recognized as highly innovative.
In this regard, DELTA devotes a lot of effort in developing intangibles such as
innovation capabilities, human capital as well as sustainability-centred culture.
Therefore, our findings emphasize the notion that these intangibles could be seen as
potential mediators of the relationship between environmental performance and
economic bottom line.
When searching for possible mechanisms that enable the shift of the organization
towards sustainable development, our results suggest that one should take into
consideration the link between sustainability and quality perspectives. By providing
evidence of the strong synergies between EMS and quality management framework,
 our findings emphasize the previous assertion that quality management is an ISO 14001
important antecedent of environmental management maturity ( Jabbour et al., 2014). in a corporate
As observed in our sample, ISO 14001-certified organizations strongly emphasized
the focus on stakeholders and holistic perspective in order to be able to
sustainability
effectively address environmental and quality issues. Similarly, prior literature
stressed the importance of the stakeholder orientation in discussing the relationship
between quality management and sustainability (e.g. Garvare and Johansson, 2010; 883
Kuei and Lu, 2014).
We also observed in our sample that the organizations encountered difficulties in
strategically addressing ISO 14001. It appears that ISO 14001 lacks relevance to the
overall strategy of the organization because of its narrow focus on environmental
performance. Moreover, the case organizations revealed that there is no clear link
between strategy, organizational performance measurement system and the inclusion of
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ISO 14001. As observed in our sample, ISO 14001 offers merely incomplete and vague
advice on how to evaluate and review strategy. These findings can be supported by the
findings of multiple case studies performed by Chiarini (2014), who discovered that
ISO 14001 and its environmental policy was somehow disconnected to performance
measurement. It can be argued that ISO 14001 in itself does not provide sufficient
strategic planning for sustainability (Asif and Searcy, 2014), likewise it cannot provide
sufficient reporting information in terms of measuring and assessing performance
(Delmas, 2001).
Regarding the social performance results, the case organization ZETA devoted
substantial effort to employee training and improving environmental awareness;
however, they did not achieve superior environmental performance compared to the
ISO 14001-certified organizations. The latter indicates the importance of using EMS in
order to effectively and systematically manage short-term and long-term impacts of the
organization’s processes, products and services on the environment (Sebhatu and
Enquist, 2007; Link and Naveh, 2006). However, it appears that ALPHA and BETA
failed to address social aspects to the same level as that they manage their
environmental aspects. This implies that pursuing social benefits is a theme that needs
attention beyond the ISO 14001’s scope. As such, our study indicates that the ISO 14001
lacks systematic approach in identifying and evaluating social aspects. In this regards,
MacDonald (2005) proposed a framework (based on ISO 14001) for systematic planning
towards the compliance with basic principles for sustainability, including the
identification of social aspects. Moreover, it would be beneficial for organizations
to embed social responsibility principles, such as those deriving from the ISO 26000,
into the ISO 14001 framework. In the case of GAMMA, additional voluntary initiative is
used to endeavour the transition of the organization towards a socially responsible
company. Stakeholder identification and engagement was considered essential for
GAMMA to address social responsibility.
We acknowledge that there are possible sources of bias in the two groups within
the sample (ISO 14001-certified organizations and non-ISO 14001-certified
organizations). As evidenced by the sample distributions, average organization
size is bigger for the group of the certified organizations. Whilst it has been found
that most organizations irrespective of size appreciate to some degree the importance
of good environmental practices, there could be some differences in terms of the
diffusion of the ISO 14001 standard. For instance, Nishitani (2009) argues that
adoption of the ISO 14001 standard is also correlated to the size of the organization and
its profitability, especially because larger and more profitable organizations are
 MEQ more able to afford the costs of initial certification. Further, according to the
26,6 Hillary (1999) internal barriers to EMS adoption are more important than external ones.
This means that the lack of human resources rather than financial ones is the major
internal barrier to EMS implementation and becomes increasingly important as the size
of the company decreases.
According to the above explained complexities, one might also identify plausible
884 explanations for different levels of achieved TBL performance outcomes.
While economic, quality and environmental results provided good evidence for
sustainable improved performance being associated with certification to ISO 14001,
the same evidence cannot be provided for the perceived social performance.
According to the results of our study the non-ISO 14001-certified organizations
had on average better social performance results than the certified organizations
(e.g. non-certified organizations perceived higher employees’ satisfaction rate).
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One plausible explanation can be associated with the size of the organization
and other work-related situational factors, such as organization ownership and
organizational culture. Consistent with the above-mentioned arguments, Tansel
and Gazioglu (2013) reported in their study that the highest overall job satisfaction
score was found in the smallest organizations (i.e. those with up to 50 employees).
Accordingly, in small organizations, employees are in general more satisfied with
contingent rewards, the nature of the work, operating conditions, co-workers and
communication (Tansel and Gazioglu, 2013).

7. Conclusions
The purpose of this study was to analyse if and how ISO 14001 can be used to advance
corporate sustainability practices and performance. In this regard, this study
contributes to the corporate sustainability literature by investigating the mechanisms
through which organizations can shift to more sustainable patterns. The findings in
this paper show that despite the fact that ISO 14001 does not set requirements
regarding the achieved performance (it sets up a framework for an organization to
reduce its environmental impacts), it can support the actions and the expectations
required to improve corporate sustainability performance.
A fundamental prerequisite for being able to answer the RQ1 is a clear understanding
of the organization‐wide sustainability framework. It is suggested that this perspective
requires a thinking that goes beyond the individual sub-system (e.g. stakeholder
requirements regarding environmental sustainability) and considers the whole system.
System approach can enable organizations to translate motives (internal and external) to
business strategy, consequently to business processes and ultimately to performance
outcomes. The proposed perspective is expected to provide a stronger connection to
competitive advantage by relying on the concept of stakeholder value. The latter is
considered as essential prerequisite to internalize ISO 14001 in daily practice.
Looking for answers to the RQ2 this paper proposes a twofold answer. Although the
case organizations have shown the positive effect on economic bottom line, the aim of
this study is not to generalize these findings; it is rather to identify mechanisms that
lead to superior performance results. A conclusion drawn in this paper is that the very
meaning and underlying mechanisms of the relationship between environmental
management practices (derived from ISO 14001) and economic bottom line are
still rather ambiguous. According to the results, the standard was perceived as a
framework to improve process efficiency, to reduce costs, to improve corporate image
and ultimately to contribute to the economic bottom line. However, our case study
 organizations also provide some evidence in support of the bidirectional relationship ISO 14001
between environmental performance and economic performance. in a corporate
In response to the RQ3 our study suggests that ISO 14001 should be integrated with
quality management, strategically oriented and coupled with suitable performance
sustainability
measurement system to enable effective measurement and improvement of corporate
sustainability initiatives. It could be argued that the corporate performance measurement
system should be extended to include all dimensions of the TBL, including indicators that 885
aim to measure environmental policy deployment.
Further, the findings of this study suggest that in order to use ISO 14001 as an
effective tool for fostering the change towards sustainable development, organizations
need to make a step beyond ISO 14001’s environmental focus and address the social
aspect as well. It is not our intention to disprove the positive interaction between ISO 14001
and social performance (RQ4); however, we found in our sample that ISO 14001 lacks
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systematic addressing of the social aspects. Both internally and externally, ISO 14001
certified organizations did not express superior social benefits (taking account of the
average composite scores).
Regarding the inter-relationship among the TBL performance benefits and
ISO 14001 (RQ5) our findings indicate that ISO 14001 in itself cannot successfully serve
as an integrative mechanism among TBL. As revealed in this study, a holistic
perspective which enables a multidimensional perspective (e.g. integrated view on
environmental, quality and social responsibility issues) is key to support effective
change process towards sustainable development and is a key integrative mechanism
among TBL. It is argued that the organizations have to identify the overlap between
external responsibility and internal improvements. This means that the organizations
need to embed sustainability aspects into tangible and intangible product/process
quality characteristics, through a constant focus on stakeholders’ wants and needs, and
on the basic principles of continuous improvement.
For practitioners, our findings suggest that the adoption of ISO 14001 should be
based on synergies between internal and external motives. Accordingly, corporate
sustainability initiatives should be aligned with stakeholders’ demands and
expectations and should be focused on the internal improvements while considering
the TBL outcomes. Further, the organizations should recognize the importance of
integrated and holistic view of their business as well. Managers should acknowledge
the expansion of the scope of quality issues and concerns within organizations in such
a way that quality would be perceived in the context of satisfying multiple
stakeholders in addition to the customers. With respect to this point of view,
environmental and social considerations should be integrated in quality characteristics
of the products/services and processes. Further, it is indeed appealing for managers to
believe that ISO 14001 certification will lead to superior business benefits; however,
it should be recognized that merely using the ISO 14001 will not be sufficient to
make substantial shift towards sustainable development. In this regard the top
management’s challenge is to create a strategic context for developing and selecting
promising sustainability initiatives.
As with all of the studies, there is a number of limitations and directions for future
research. Although the study is not based merely on one case study, the increase in a
sample size could be seen as an opportunity to improve the generalizability and
robustness of the research. Future empirical studies should investigate the
sustainability performance benefits by focusing on institutional isomorphism as a
theoretical underpinning. More research is also needed to understand the contextual
 MEQ conditions under which environmental practices are effective in terms of TBL. Further,
26,6 although the use of perceptual measures is considered as acceptable and it is used in
most of the sustainability-related studies, future studies could be improved by using
real data for the evaluation of sustainability performance.

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Further reading
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systems”, Business Process Management Journal, Vol. 10 No. 6, pp. 608-615.

About the authors

Dr Matjaž Maletič is an Assistant Professor at the Faculty of Organizational Sciences, University
of Maribor. His main research interest concerns the quality management, corporate
sustainability, integration of quality management and sustainability as well as the overall
organizational performance. He holds a Bachelor’s Degree in Wood Science and Technology
(University of Ljubljana, Biotechnical Faculty), a Bachelor’s Degree in Organization (University
of Maribor, Faculty of Organizational Sciences) and PhD Degree in Quality Management
(University of Maribor, Faculty of Organizational Sciences). Dr Matjaž Maletič is the
corresponding author and can be contacted at: [email protected]
Manja Podpečan is a Post-Graduate Student at the Faculty of Organizational Sciences,
University of Maribor. Her current research interests involve contemporary quality management
 MEQ issues in manufacturing industry. Her prior research was focused on FMEA implementations
issues with a particular focus on construction industry.
26,6 Damjan Maletič is a Teaching Assistant and Researcher at the Faculty of Organizational
Sciences, University of Maribor. His research activities are mainly devoted to the fields of
maintenance management and quality management. At present, his research is focused on
studying the interaction between quality management, production and maintenance
performance. He holds a Bachelor’s Degree in Wood Science and Technology (University of
890 Ljubljana) and Organization (University of Maribor). He is currently a PhD Student at the Faculty
of Organizational Sciences, University of Maribor.
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