Environmental Management Aspects & Environmental R&D ：

Japanese Perspectives

The Porter Hypothesis at 20: Session 1. 　 How Can Environmental Regulation Enhance

Innovation & Competitiveness?

Toshi H. ArimuraCenter for the Environmental & Trade Research,

Dept of EconomicsSophia University

1

Point 1: Role of Environmental Management System (EMS) ?

• For managers, the possibility of environmental innovation may not be obvious.

• EMS such as Environmental Accounting Systems or ISO 14001 can help companies to find out “resource inefficiencies and potential ( environmental) technological innovation”

2

Environmental Policy

Environmental Management Tools

Environmental R&D Investment

Flexible Instruments

Another Path for Porter Hypothesis: EMS

3(Arimura, Hibiki and Johnstone,2007)

Point 2: Green Supply Chain Management (GSCM) : Spillover Effects?

Suppliers asked to be green:

(GSCM)

EnvironmentalPolicy

(Voluntary)EnvironmentalManagement

Unaccounted“Spillover” Effects

Environmental Improvements &

Innovations

Environmental Improvements &

Innovations?

Environmental Improvements &

Innovations?

(Arimura, Darnall & Katayama, 2009)

Point 3: Corporate Size and Environmental R&D

– Larger firms are engaged in environmental R&D, but not smaller firms

(Arimura & Sugino, 2008)5

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

From 0.1 to less than 1 billion yenFrom 1 to less than 10 billion yenMore than 10 billion yen

Proportion of firms with Environmental R&D Activities in Japan

Thank you!

t-arimu@sophia.ac.jp

6