Toward A Place‐Based Understanding of Business Sustainability: The Role of Green Competitors and Green Locales in Firms' Voluntary Environmental Engagement

Abstract Management research has extensively considered who , what , when , why , which and how aspects pertaining to firms' voluntary environmental practices, yet the where aspect, which would consider the role of a firm's location on its environmental practices, has received remarkably less attention. We explore three research questions relating social and physical attributes of a firm's location with its engagement in a voluntary environmental program (VEP). Drawing on a sample of hotels participating in a Costa Rican VEP, we find that the number of VEP certified competitors (i.e. green competitors) and firm proximity to a sacrosanct environment (i.e. a green locale) are positively related to a firm's level of VEP engagement. We also find an interaction effect such that the relationship between the number of VEP certified competitors and the level of VEP engagement is positively moderated by firm proximity to a green locale. We argue that firms' voluntary environmental engagement can be enhanced by developing green clusters amid green corridors. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment