Institutional and stakeholder effects on carbon mitigation strategies

Abstract The latest IPCC report foreshadows a far gloomier picture of climate change consequences than previously held by demonstrating how avoiding environmental damage requires transforming the world economy at a speed and scale that has “no documented historic precedent.” One of the options to address climate change is adoption of mitigation strategies to reduce carbon emissions on national, sectoral, and corporate levels. This research analyzes mitigation responses by organizations facing institutional and stakeholder pressures while dealing with the risk and opportunities presented by climate change. Our research indicates that different types of institutional pressures—coercive, normative, and mimetic—lead to different and, in certain situations, more active responses from companies. We find that coercive pressures are about equal or more effective than normative or mimetic pressures for adoption of mitigation strategies.