Corporate Participation in Voluntary Environmental Programs in India: Determinants and Deterrence

This article examines the motivations for firms in India to participate in voluntary environmental programs (VEPs) using a unique data set of cement, power and steel industry for the year 2012. It examines the effects of regulatory, societal, market and internal factors in influencing voluntary environmental behavior. To this objective we estimate both, ordinal (Ordered Probit) and cardinal (Poisson) models. We find that the firm size, its location, export orientation, and intangible valuation have a positive and significant relationship with the number of VEPs undertaken by the firm. The MNC status of the firm has no impact while the debt equity ratio and average age of the firm has negative impact on the adoption of VEPs.