3.3 Technological rent
Resolution of environmental problems has become an important
business opportunity for companies specialising in this field. This is often
referred to as the `environmental industry'. The important aspect here is to
identify the situations where a company which wants to improve its
environmental performance has optimised its manufacturing or waste management
through the development of technologies for pollution control. This may lead to
the development of technologies that may eventually be sold to other firms.
Companies adopting such a strategy may also receive a benefit from being the
first player («first-mover advantage») and lobby governments in
favour of tighter regulation according to their higher and thus export their
eventual competitive disadvantage.
Since it is difficult to find examples of companies that have
benefited from technological opportunities as derivative trading, one would
assume that «the market of technology for pollution control» as a way
to turn an environmental problem in increasing revenue is not a widespread
phenomenon (Lanoie, et al., 2007). The only example would be the case of
companies which should already have research facilities, and many resources,
and eventually sell to other businesses the technology of pollution control
that they have developed for their own needs. In light of these findings, the
next hypothesis can be formulated as follow:
H3: Firms that invest in eco-innovation increase their
return on sales by selling their technologies to other firms.
3.4 Cost of materials and energy
Porter suggested that pollution is generally associated with
the waste of resources not fully utilised, or loss of energy (Porter 1991 and
Porter and van der Linde, 1995). He concludes that environmental policies both
more stringent and more flexible (e.g. taxes and tradable permits) would
benefit the economy, in a way that they stimulate innovations which will in
turn offset the costs of compliance with these policies. Similarly, Katz (2003)
shows, from a sample of 33 LEED (Leadership in Energy and Environmental Design)
certified green buildings that the financial benefits of green design reaches
more than 10 times the additional cost of environmentally friendly building. In
fact, the range of opportunities to reduce both pollution and energy costs of
equipment and services appear to be quite large. Over the past eight years,
Lanoie has collected more than 50 examples of firms that have succeeded in
reducing pollution as well as the costs of resources, energy and services. Such
opportunities are more likely to stand for companies whose production methods
are flexible and with effective means of communication in order to facilitate
the transmission of new ideas to decision makers. Furthermore, the likelihood
of success is greater for industries subject to fierce competition, hence the
cost reduction is more important in sectors where there are market based
environmental policies (for example, pollution taxes or tradable permits) to
trigger eco-innovation (Lanoie, et al., 2007). Subsequently, the next model
hypothesis is formulated this way:
H4: Eco-innovative firms increase their profit compared to
their non-innovative competitors by producing via more efficient
processes.
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