Carbon emission is one of the major problems in the environment today globally. Emission of carbon has been affecting the industries greatly. In this research, the stakeholder theory will be discussed with effect to the carbon emission. There are certain theoretical as well as practical motivations to this concept of carbon emission with accordance to the stakeholder theory. The research is mainly aimed at evaluating the changes in the emission of carbon by the companies.
Nowadays, there has been rigorous increase in the number of companies around the globe. Due to this rapid increase in the number of companies, there has been a lot of changes in the climate and the societies have been facing a lot of challenges due to these changes. The performance of the companies has also been impacted in the last decade due to these climatic changes. To take care of these changes, certain steps have to be taken by the companies to reduce the carbon emission by the companies (Lou, Tang and Lan 2013). Thus, some of the companies have taken the initiative to share the information regarding their emission of the greenhouse gases so that they can show the initiatives that they have adopted to reduce the amount of carbon emitted by the companies. All the companies have adopted measures to respond to the problem of the climatic changes and the consequences that they can face due to these changes (Tang and Tang 2012). Influencing the performance of the companies is under the power of the stakeholders. Thus, actions are taken by the firms so that they can meet the expectations of the stakeholders. The main argument of the stakeholder theory indicates the collection of the data by the managers of the company under the pressure of the stakeholders (Donaldson and Preston 1995).
There might be direct or indirect effects of the organizational operations on the stakeholders. Stakeholders play an important role in the decision making of the organizations. Following the influence of stakeholders, they need to consider and modify activities in line with the benefit of the organizations (Mitchell, Agle and Wood 1997). This helps to reduce the interests that are contradictory. The interests and the expectations of the stakeholders can be approached by the companies with the help of the amount of the carbon emitted by the companies that are environmental as well as social in nature.
In the current scenario, a lot of new companies are on the rise all across the globe. These companies belong to different industries. All the companies have production work to be conducted. At the time of production of any kind, carbon is emitted by the firms. This carbon emitted by the firms in the atmosphere is harmful to people and lives as these increase the necessary carbon content in the atmosphere and hence climatic changes are observed (Donaldson and Preston 1995). Thus, it is important that the companies adopt necessary issues to remedy the emission of Carbon in the atmosphere. The emission has to be reduced so as to save the atmosphere and prevent the drastic changes in the climate. The organizations have disclosed the amount of the carbon emissions that has been done. This emission is the result of the plant abuse that is taking place in the earth (Agle, Mitchell and Sonnenfeld 1999). Thus, the organizations have become aware of the problem and are taking measures to reduce the emissions in the atmosphere which is expected to change the environment. It has been observed from researches that Carbon emissions are different in different localities. Thus, the climate in different places might be a cause of the different content of emission of carbon. In this paper, USA has been chosen as the region of interest and the carbon emissions of the USA companies have been considered for the analysis (Neville, Bell and Whitwell 2011).
Researches have also shown that the companies in USA emit a huge amount of carbon into the atmosphere. 23 – 24 % of the carbon Dioxide emitted by the corporate firms all over the world come from the USA companies. USA uses fossil fuels in order to produce energy and hence the emission of carbon in the atmosphere by the USA firms are quite high (Jones and Wicks 1999).
On the other hand, stakeholders play a very important role for a company. For any company, the Stakeholder theory describes four factors such as the nature of the firm, the thoughts of the managers about managing the firms, the thoughts of the board members in controlling the interests of the con stridencies and the method of management of some organizations. There is not much difference in opinions about the who are considered as the stakeholders to a company. The stakeholders can be the investors of the company, the employees of the company, the customers of the company as well as the business associates to the company. Stakeholders can be a single person, a group of people as well as some organizations (Dong, Burritt and Qian 2014). The first type of people that come to mind when stakeholders are considered are investors or shareholders of the company. Policies such as carbon tax, measures relating to technology orientation and schemes relating to trading emissions have been adopted by the USA companies so that the use of Fossil fuels can be reduced which will in turn reduce the emission of the carbon content in the atmosphere (Turban and Greening 1997). The companies need to keep the interests of the stakeholders in mind before adopting the measures to reduce the carbon emission in the atmosphere. The schemes adopted by the companies will be directly affecting the stakeholders as the future of the stakeholders are hugely dependent on the performance of the companies. Thus, several measures have also been adopted by the governments of the respective countries to reduce the emissions of carbon amount in the atmosphere by the companies. The measures that has been adopted by the USA government for the reduction in the emissions of carbon in the atmosphere by the companies include mechanism of clean development. This mechanism enables the companies to reduce the emissions of green house gases in the atmosphere. It is done mostly by organizing a several gatherings that will be useful in interfacing different companies. These gatherings will also be useful in investigating the techniques adopted by the supervisors so that they can enhance the performance of the respective organizations as well as the benefits of the respective organizations. The new advances of the companies will be focused as a result of the new measures implemented.
In order to do this research, dependent, independent variables as well as control variables needs to be defined in relation to the discussed literature. The variables considered for this research are defined and discussed henceforth.
The chosen dependent variable for this research paper has been considered as the changes in the emission of carbon di-oxide from the year 2012 to the year 2013. The changes are expressed in the percentage scale. The data is collected from the CDP survey that has been conducted previously. From the data, it can be observed that the changes in the emission of carbon di-oxide measured in percentage have differed over time. This might be because of the effect or influence that the decision of the stakeholders has for a company.
Independent Variable
The management of some companies have been receiving incentives and some other companies do not provide incentives to the management. These information has also been obtained from the CDP survey data. Thus, whether incentives have been provided or not to the management is to be considered as the independent variable.
Control Variable
The CDP survey has been conducted with companies across the globe. Locality of the companies are important as based on the geographical location of the companies, the emission of carbon varies. Thus, results obtained by considering companies across the globe might not be proper. Hence, the research is made country specific. Here, only companies of USA have been considered.
This research paper is thus aimed at establishing the differences in the percentage changes in the emission of carbon by the companies based on USA with respect to the introduction of incentives that some companies provide to the management and some others do not. The changes in the emission of carbon di-oxide has been measured in percentage scale from the year 2012 to 2013. The decision of the companies in the emission of carbon di-oxide is mostly based on the influence the stakeholders play on the companies. Based on the decision of the stakeholders, the companies will be deciding whether to provide incentives to the management or not.
References
Agle, B.R., Mitchell, R.K. and Sonnenfeld, J.A., 1999. Who matters to Ceos? An investigation of stakeholder attributes and salience, corpate performance, and Ceo values. Academy of management journal, 42(5), pp.507-525.
Donaldson, T. and Preston, L.E., 1995. The stakeholder theory of the corporation: Concepts, evidence, and implications. Academy of management Review, 20(1), pp.65-91.
Dong, S., Burritt, R. and Qian, W., 2014. Salient stakeholders in corporate social responsibility reporting by Chinese mining and minerals companies. Journal of Cleaner Production, 84, pp.59-69.
Jones, T.M. and Wicks, A.C., 1999. Convergent stakeholder theory. Academy of management review, 24(2), pp.206-221.
Lou, L., Tang, Q., and Lan, Y-C. (2013) Comparison of propensity for carbon disclsoure between developing and developed countries, Accounting Research Journal 26(1) pp 6-34
Tang, Z and Tang, J (2012) Stakeholder-firm power difference, stakeholders’ CSR orientation, and SMES’ environmental performance in China, Journal of Business Venturing, Vol 27 (4), pp. 436-455.
Mitchell, R.K., Agle, B.R., and Wood, D. J. (1997) Toward a theory of stakeholder identification and salience: defining the principle of who and what really counts, The Academy of Management Review 22(4) pp. 853-886.
Neville, B.A., Bell, S.J. and Whitwell, G.J., 2011. Stakeholder salience revisited: Refining, redefining, and refueling an underdeveloped conceptual tool. Journal of business ethics, 102(3), pp.357-378.
Turban, D.B. and Greening, D.W., 1997. Corporate social performance and organizational attractiveness to prospective employees. Academy of management journal, 40(3), pp.658-672.
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