Chapter 2: The Varieties of Capitalism Approach
Standards for evaluating organizational performance and prevalent criteria for judging firms’ strategic priorities vary significantly across institutional regimes and cannot be derived from a single universal market rationality. (Whitley, 1999: 13) Institutions are embedded in a culture in which their logic is symbolically grounded, organisationally structured, technically and materially constrained, politically defended, and historically shaped by specific rules and norms. (Hollingsworth, 1997a: 266) The key questions to be addressed in this book were posed in Chapter 1. The first, and central question, is: what institutional factors are likely to motivate firms in the car industry to see environmental issues as central to their business interests? The second, related, question is: are the motivators for firms embracing environmental improvements universal, or specific to firms based on their nationality or, possibly, individual cultures? Depending on the answers to these, the third question is: why should the car industry be concerned about the environment, particularly given its global economic significance and resulting political power? In discussing how these questions will be answered, the significance of material versus normative factors was highlighted, and therefore rationalist versus institutional perspectives. The assertion was made that although material factors are important, norms and the institutions to which these give rise are crucial for explaining why firms of different nationalities approach making environmental commitments – that is internalizing environmental externalities – in different ways. In Chapter 1, the enduring importance of car firms’ home states in terms of production and key markets, as well as ownership and headquarters, led to...
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