International integration: a hope for a greener China?

Purpose - In recent years, trade up argument has gained momentum. It argues that international integration can benefit developing countries' environments by fostering the adoption of voluntary environmental standards, such as International Organization for Standardization (ISO) 14001 certification. Based on this argument, a social marketing program that encourages greenness among buyers, especially downstream industrial buyers (for example, auto industry) in developed countries could motivate firms in developing countries go green. The purpose of this paper is to provide an investigation on whether trade up is a real hope, and what is required to make it real. Design/methodology/approach - Theoretical modeling and case studies. Findings - This paper finds that international trade does gear up the adoption of ISO 14001 standards in China through increasing pressures from international green customers. However, our analyses suggest that the adoption of ISO 14001 certification does not necessarily improve firms' compliance with existing environmental regulations in China. The actual impact depends on how stringently environmental agency carries out inspections. We also find that in China, ISO 14001 certification motivates little, if any, environmental performance improvement beyond bottom-line environmental regulations. Research limitations/implications - This finding suggests that the trade up argument as well as a social marketing strategy targeting international buyers (including downstream industries) need to be scrutinized carefully before being used to guide practice. Originality/value - Few efforts have been made to explore the actual impacts of ISO 14001 certification in developing countries. This paper fills this gap. It provides empirical support for Andreasen's argument that social marketing should be applied more broadly to achieve the desired impacts.