National institutional antecedents to corporate environmental performance

Understanding what drives firms towards environmentally sound manufacturing practices is important. While we have learned in recent years about firm-level drivers of corporate environmental performance (CEP), we know little about country-level antecedents. Our objective is to investigate the extent to which firm-level variation in CEP is explained by country-level differences. We develop hypotheses building on the Varieties of Capitalism framework and find-using data on 2724 firms in 42 different countries-that CEP is driven by the degree of market freedom of a firm's home country, the non-governmental organizations active in the country and its freedom of the press.