An Investigation of the Malaysian Palm Oil Industry’s Environmental Strategies, Stakeholders’ Pressure, Environmental Effectiveness and Competitive Advantage

Abstract

Over the last three decades there has been increasing pressure from stakeholders on businesses to be environmentally responsible. Business organisations cannot help but take this consideration seriously because it has a far-reaching impact on their very survival. This research is intended to bring insights into how and why a business's management responds to environmental pressure from stakeholders. How a business to its stakeholders is known as environmental strategy. In addition, this study also investigates how proactiveness in implementation of each type of environmental strategy impacts on a business environmental effectiveness and competitive advantage. In Malaysia palm oil is the most important agricultural commodity in the country, and contributes substantially to the economy. Unfortunately, its activities are not without environmental costs. Deforestation, depletion of flora and fauna, excessive use of chemicals, air and water pollution are the results of the industry's activity. But due to stakeholders' pressures, the industry has embraced environmental management in its activities, albeit at a slow pace.Against this background, this study seeks to investigate the efficacy of corporate environmentalism, using a number of palm oil companies as case studies.This study is paramount as no such study has previously been conducted in Malaysia. The Malaysian palm oil industry offers an interesting case for studying corporate environmentalism in developing countries.

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