The influence of different characteristics of the EU environmental management and auditing scheme on technical environmental innovations and economic performance

Environmental modernization of the economy includes the implementation of environmental policies which connect environmental management to technical environmental innovations and improved economic performance. Some of the most important instruments in this respect are standards for environmental management systems such as the EU Environmental Management and Auditing Scheme (EMAS). Based on a unique data set of German EMAS-validated facilities, this paper investigates the effects of different characteristics of EMAS on technical environmental innovations and economic performance. Most firms report a positive influence of environmental management systems in general on environmental process innovations. Furthermore, environmental reports support the diffusion of technical environmental innovations. The econometric analysis shows a positive impact of the maturity of environmental management systems on environmental process innovations. Another important determinant of environmental process innovations is the strong participation of specific departments in the further development of EMAS such as the R&D department. For environmental product innovations, learning processes by environmental management systems have a positive impact. Such learning processes as well as environmental process innovations also have a positive influence on economic performance. We conclude that a careful design of EMAS is important for both the environmental and economic performance of a facility. The conclusions should also be relevant for the worldwide ISO 14001 standard since over 55% of the interviewed EMAS-validated firms have also implemented ISO 14001.