Environmental purchasing and firm performance: an empirical investigation

Much debate has occurred in the extant literature as to whether socially re sponsible actions undertaken by firms result in improved financial performa nce. One key dimension of social responsibility is environmental initiative s and programs. While the purchasing function can create value and signific antly affect the environmental actions of a firm and its upstream supply ch ain, no research to date has explored the effect of environmental purchasin g on firm performance. Our research provides an initial examination of this relationship. We combine survey and archival data to show that environment al purchasing is significantly related to both net income and cost of goods sold, after controlling for firm size. leverage, and primary earnings per share. (C) 2000 Elsevier Science Ltd. All rights reserved.