Association between Cost-Benefit of Environmental Performance and Financial Performance of Some Selected Asian Companies

a) Purpose: In the recent few decades, the strategic implications of environmental performances have been examined by the scholars. Contradiction exists regarding the relationship between cost incurred to carry on such environmental activities and the benefits realised by the company and investors. Therefore, present study seeks to re-examine the association between cost and benefits of environmental performance and its relationship with the corporate financial performances.b) Method: Financial and non-financial information are collected from the year 2010 to 2012 of 60 selected Asian companies. Pooled data have been analyzed by using different measurement techniques with the help of multiple linear regression models. c) Findings: The results show that the market value of equity has significant positive association with environmental cost and benefits (physical & economic). Again, the environmental benefit is strongly related with the environmental cost and overall environmental performances. Strong association is also found between sale value and environmental cost. It has also found that the environmental cost-benefit significantly differs between high and low level of environmental performance disclosing firms. d) Implication & Limitation: The study brings out that the investors' benefit (market value of equity) is associated with the proper realisation of environmental benefits (company benefits), which can be managed by the expenditure for environmental activities and better environmental performances. These results can be strategically used by the managers. As the study has been conducted on the basis of publicly available reports for a relatively small period, a better result could be obtained by using observation for a longer period of time