Impact of ISO 14001 and ISO 9001 adoption on corporate performance: evidence on a bank-based system

• Published in: International journal of productivity and performance management Vol. 73; no. 5; pp. 1641 - 1667
• Main Authors: Neves, Maria Elisabete Duarte, Reis, Sofia, Reis, Pedro, Dias, António Gomes
• Format: Journal Article
• Language: English
• Published: Bradford Emerald Publishing Limited 28-05-2024; Emerald Group Publishing Limited
• Subjects: Certification; Corporate culture; Costs; Dependent variables; Design standards; Economic development; Empirical analysis; Engineering firms; Environmental management; Impact analysis; Independent variables; International finance; International organizations; ISO standards; Literature reviews; Managers; Method of moments; Quality management; Quality standards; Sovereign debt; Sustainability; Sustainability reporting; Portugal; GMM system; Euronext Lisbon; ISO 9001; ISO 14001; Performance; Sustainability
• ISSN: 1741-0401; 1758-6658
• DOI: 10.1108/IJPPM-08-2022-0398

PurposeThis paper aims to analyze the impact of the adoption of ISO 14001 and ISO 9001 on the performance of Portuguese companies. The sample includes the companies listed on Euronext Lisbon, with economic, financial and specific information – the specific being environmental information and quality information – for the period between 2015 and 2019, which corresponds to the post-Troika period when some economic growth started to be witnessed. The specific information of each area is translated into the environmental certification by the ISO 14001 standard, the quality certification by the ISO 9001 standard, and sustainability reports.Design/methodology/approachTo achieve this aim, four variables were used as a measure of the companies' performance, Return on Assets (ROA), Return on Equity (ROE); Tobin's Q and EBITDA Margin. With this data, different panel models were tested to validate if ISO 9001 and ISO 14001 certifications impact Portuguese listed companies performance. Specifically, the authors have used the Generalized Method of Moments, GMM-System, an estimation method proposed by Arellano and Bover (1995) and Blundell and Bond (1998).FindingsThe results show that, in general, the environment and quality variables fail to explain the dependent variables, that is, ISO certifications do not provide positive or negative variations in the performance of companies, suggesting that they are not yet as much for civil society, as well as for current or potential shareholders. When used as an independent variable, certification according to the ISO 14001 or 9001 standards, negative and significant oscillations were verified in the dependent variable, MgEBITDA, suggesting that only for managers this variable is determinant, but with a negative impact, given the high costs, it entails without pressure from other stakeholders.Originality/valueThis study is the first to analyze the impact of the adoption of ISO 14001 and ISO 9001 on Portuguese companies' performance. This empirical study aims to show all investors, managers, regulators and civil society itself the long path that still needs to be taken toward sustainability.