Firm performance and environmental collaboration in manufacturing

We identify empirically the effects of environmental collaboration in the supply chain on operational and financial performance of manufacturing firms. Self-reported survey data is combined with financial reporting data on 135 manufacturing firms operating in Finland. Environmental collaboration within the firm and externally with customers and suppliers is studied against measures of firm performance by applying descriptive analysis, confirmatory factor analysis and generalised linear modelling. The novelty in this research is the combination of self-reported survey data with financial reports-based data in analysing the effects of three dimensions of environmental collaboration on firm performance. The findings suggest that while external collaboration had mostly positive effects, internal collaboration seems to be more problematic. The results highlight the need for supply chain focus in environmental issues. Manufacturing firms should not consider environmental efforts merely as an extra burden; there seem to be ways of putting in more effort without jeopardising performance.