Lu, Y; Cui, Q and Le, Y (2013) Turning green to gold in the construction industry: Fable or fact? Journal of Construction Engineering and Management, 139(8), pp. 1026-1036. ISSN 0733-9364
Abstract
Green principles have been increasingly incorporated into planning, design, construction, and maintenance processes in the engineering and construction industry. Along with the growth of the green initiative, going green not only demonstrates corporate social responsibility, but may yield significant economic benefits. This study compares financial performance between green and conventional firms in the engineering and construction industry. A total of 22 sample companies used in this empirical analysis are categorized into two groups - green versus conventional firms - in accordance with Engineering News Record and Newsweek green company lists. Two groups are compared in terms of short-term financial performance, long-term economic value, and market value. The analysis shows that green firms outperform conventional firms on return on equity (17.4 versus 8.2%) and economic value added margin (0.35 versus -1.43%). However, the green strategy has not yet been factored into corporate market value. The findings yield important managerial implications for engineering and construction organizations to integrate sustainability into their business operation.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | economic value added; financial performance; organizational strategy; return on equity; sustainability |
| Index terms: | strategy, organizational strategy, economic value added, financial performance, construction organization, construction industry, corporate social responsibility |
| Subjects: | industry analysis, business analysis, management, health safety and environment, economic analysis, business, organization |
| Topics: | Health and Safety, Business Strategy, Research Practice |
| Descriptive scope: | 3 PCT |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here