Firm Self-Regulation Through International Certifiable Standards: Determinants of Symbolic Versus Substantive Implementation

Petra Christmann, Rutgers University, and Glen Taylor, University of Tampa

9/19/2008
(Original Publish Date: 11/14/2005)

International certifiable management standards that have been advocated as a governance mechanism for firm self-regulation of environmental conduct, working conditions, and quality control are only effective if certified firms comply with standards’ requirements. Our empirical analysis shows that ISO certified firms in China strategically select their level of compliance depending on customer preferences, customer monitoring, expected sanctions by customers and firm capabilities. These findings have important implications for the effectiveness of a global system of self-regulation based on certifiable standards.