PREGLEDNI ZNANSTVENI ČLANEK - REVIEW PAPER
Prejeto/Received: December 2012 Popravljeno/Revised: Januar 2013 Sprejeto/Accepted: Januar 2013
THE ENVIRONMENTAL CREDITWORTHINESS ASSESSMENT METHODOLOGY1
Metodologija presojanja okoljske bonitete
Vesna Čančer
University of Maribor, Faculty of Economics and Business vesna.cancer@uni-mb.si
Miroslav Rebernik
University of Maribor, Faculty of Economics and Business rebernik@uni-mb.si
Jožica Knez-Riedl
University of Maribor, Faculty of Economics and Business ¡ozica.knez@uni-mb.si
Abstract
This paper aims to offer a review of existing theoretical bases of the measurement and assessment of environmental creditworthiness, particularly on the level of enterprises. Its objective is also to examine the possibilities of the multi-criteria assessment of environmental creditworthiness by enterprises themselves ("internal rating"). Following the prescriptive approach, it delineates the particularities of a frame procedure for the multi-criteria assessment of environmental creditworthiness. The credibility of eco-ratings depends not only on the quality of information sources and the choice of sensible environmental indicators, but also on the transformation of data into local and aggregate values that are understandable to decision makers.
Keywords: environmental creditworthiness assessment, enterprise, multi-criteria decision making, prescriptive approach, social responsibility
Naše gospodarstvo / Our Economy Vol. 59, No. 1-2, 2013 pp. 66-74
DOI: 10.7549/ourecon.2013.1-2.07
UDK: 519.85:657.92:504.06 JEL: C44, Q5
Izvleček
V prispevku podajamo pregled teoretičnih osnov merjenja in presojanja okoljske bonitete, in sicer predvsem na ravni podjetij. Cilj prispevka je proučiti možnosti večkriterijskega presojanja okoljske bonitete v podjetjih samih (t. i. interni rating). Upoštevajoč preskriptivni pristop, razčlenjujemo posebnosti okvirnega postopka za večkriterijsko presojanje okoljske bonitete. Ugotavljamo, da je kredibilnost ekoratingov odvisna ne le od kakovosti informacijskih virov in izbire okoljskih indikatorjev, ampak tudi od transformacije podatkov v odločevalcem razumljive lokalne in agregirane vrednosti.
Ključne besede: presojanje okoljske bonitete, podjetje, večkriterijsko odločanje, preskriptivni pristop, družbena odgovornost
1 Introduction
In seeking ways to link economic and environmental performance, firms adopt environmental standards when trying to remain competitive or gain a competitive advantage. As a result, they are interested in environmental best practices and environmental creditworthiness (EC), also known as eco-rat-ing, of others and of themselves (Knez-Riedl, 2002, p. 169). The motives for eco-rating assessment are various. Some environmentally conscious enterprises want to choose their partners based on their environmental profile or en-
1 This research is part ofthe research program P5-0023: Entrepreneurship for Innovative Society, supported by the Public Agency of the Republic of Slovenia for Research Activity.
NG, ŠT. 1-2/2013 PREGLEDNI ZNANSTVENI ČLANKI - REVIEW PAPERS
multiple more or less conflicting criteria (i.e., factors and indicators of EC). It also helps decision makers confront other participants' judgment, understand the aggregate alternatives' values, and use them in the activities toward sustain-ability and social responsibility.
Another advantage of MCDM is that it enables group decision making; moreover, it has become a developing tendency in MCDM. Namely, building models for ECA, assigning weights to criteria, and measuring local values of alternatives are the steps of the MCDM in which different interested parties and interdisciplinary professional expertise should contribute. Value functions are effective in integrating expert judgments and decision-maker values, especially when appropriate assessment techniques for environmental decision problems can be applied (Beinat, 1997). Expert-based value functions are able to reproduce expert opinions.
However, firms should be aware that socially responsible and, in this context, environmentally responsible companies cannot necessarily achieve better economic development than other firms. Menz (2010) pointed out that the consideration of social and environmental factors is also directly associated with higher costs because, for example, extensive health and safety measures of modern, environmentally friendly production facilities are expensive, which could result in a company's decrease in profitability and competitiveness. As the side effects caused by entrepreneurial activity (for example, air and water pollution, health impairments) are often not or not fully borne by the polluter (imperfect internalization of external effects), less responsible companies could benefit economically at the expense of society.
The credibility of eco-ratings depends on the quality of information sources and the choice of sensible environmental indicators. Still, indicators or ratios are not enough. Information and indicators should contribute to high-quality analyses and resulting findings as well as recommendations and suggestions. In terms of analyses, different types are in use (for example, integrated analyses, portfolio analyses) in addition to staggered approaches (ADFIAP, 2009). The multi-criteria assessment of EC proposed in this paper presents such a methodology that can bring about more reliable results.
Finally, we cannot overlook the fact that environmental performance is only one dimension of the triple-bottom-line concept, and environmental assessments and reports are just a part of sustainability assessments and reports. What's more, the preparation of integrated reporting occurs before launching an international integrated reporting framework (IIRC, 2012). In this context, all three reports (economic, environmental, and social) should be unified into one report. However, the connectedness between them should be professionally analyzed and interdependencies explained. Environmental creditworthiness assessment methodology can be instrumental in this endeavor.
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NG, št. 1-2/2013 pregledni znanstveni članki - Review papers
Vesna Čančer holds a PhD in economic and business sciences and is an associate professor of quantitative economic analyses at the University of Maribor's Faculty of Economics and Business. Her research focuses mainly on multi-criteria decision making, creative problem solving, creditworthiness assessment, business process optimization, and environmental management. She has authored and co-authored a number of recent articles, book chapters, and papers.
Dr. Vesna Čančer je izredna profesorica za predmetno področje kvantitativnih ekonomskih analiz na Ekonomsko-poslovni fakulteti Univerze v Mariboru. Raziskovalno se ukvarja predvsem z večkriterijskim odločanjem, ustvarjalnim reševanjem problemov, presojanjem bonitete, optimizacijo poslovnih procesov in okoljskim upravljanjem. Je avtorica in soavtorica številnih člankov, poglavij v knjigah in objavljenih prispevkov na konferencah.
Miroslav Rebernik, PhD, is a professor of business economics and entrepreneur-ship at the Faculty of Economics and Business, University of Maribor. He was a visiting professor at Portland State University and a recipient of a Fulbright research fellowship at Babson College. He has participated in more than 80 national and international conferences. He participates in peer reviews and editorial boards for Business & Economics Review, Journal of Small Business Management, International Journal of Entrepreneurial Venturing, Economic Review: Journal of Economics and Business and the Journal of Global Entrepreneurship Research. He is the head of the research program for Entrepreneurship for Innovative Society, leads the research team Global Entrepreneurship Monitor Slovenia, and is co-editor of Slovenian En-trepreneurship Observatory.
Dr. Miroslav Rebernikje redni profesor za ekonomiko poslovanja in za podjetništvo na Ekonomsko-poslovni fakulteti Univerze v Mariboru. Bil je gostujoči profesor na Portland State University ter dobitnik Fulbrightove raziskovalne štipendije na Babson Collegeu. Sodeloval je na več kot 80 domačih in tujih strokovnih in znanstvenih konferencah. Sodeluje v uredniških in recenzijskih odborih revij Business & Economics Review, Journal of Small Business Management, International Journal of Entrepreneurial Venturing, Economic Review: Journal of Economics and Business ter Journal of Global Entrepreneurship Research. Je vodja raziskovalnega programa Podjetništvo za inovativno družbo, vodja raziskovalnega tima Global Entrepreneur-ship Monitor Slovenija ter sourednik Slovenskega podjetniškega observatorija.
Jozica Knez-Riedl, PhD, is full professor of business economics, environmental economics, and responsible entrepreneurship lecturing at Slovenian and foreign universities. In 2000, she published first Slovenian book about the topic as well as several papers in international scientific journals and other publications. She is a reviewer for international scientific journals. For her scientific work in the field of CSR and the promotion of CSR, she was awarded the HORUS award by the Slovenian Institute IRDO in 2009.
Dr. Jožica Knez-Riedl je redna profesorica za poslovno ekonomiko, okoljsko ekonomiko in odgovorno podjetništvo, kar predava na domačih in tujih univerzah. Leta 2000je objavila prvo slovensko knjigo o boniteti podjetja, sicer pa številne članke v mednarodnih revijah in druge publikacije. Je recenzentka pri mednarodnih znanstvenih revijah. Za svoje znanstveno delo na področju družbene odgovornosti in njeno promocijo je leta 2009prejela nagrado Horus, ki jo podeljuje slovenski inštitut IRDO.