Business-oriented environmental regulation: Measurement and implications for environmental policy and business strategy from a sustainable development perspective

Business-oriented environmental regulation is expected to have a fundamental role in mitigating the adverse effects of human activity on the natural environment. However, its effectiveness and efficiency are not well established. A systematic literature review reveals validity and reliability problems in the measurement of business-oriented environmental regulation. From a sustainable development perspective, we develop a theoretical framework that aims to enhance the measurement and assessment of this kind of regulation. Our theoretical framework proposes that the goals of business-oriented environmental regulation must articulate a measurement system in a 3 x 3 matrix: three measurement levels (stringency, response, and outcome-in this cause-effect order) and three sustainability dimensions (environmental, social, and economic-in this constraint order). For each cell, we propose a combination of objective and subjective indicators. This theoretical framework expands existing approaches to business-oriented environmental regulation measurement by integrating a sustainable development perspective into a measurement framework in a structured theory-driven manner. Not only will this measurement system be useful for improving environmental policy, but it will also allow companies to improve their business strategy and come closer to complying with environmental regulations in order to effectively contribute to solutions for current environmental problems and help achieve a sustainable development.

Automated summary

Business-oriented environmental regulation plays a crucial role in mitigating the adverse impacts of human activity on the natural environment. A theoretical framework has been proposed to enhance the measurement and assessment of this regulation from a sustainable development perspective, using a 3x3 matrix system. This framework not only benefits environmental policy improvement but also helps companies develop better business strategies and comply with regulations to contribute to solutions for environmental problems and sustainable development.