The Link between Environmental Innovation, Patents, and Environmental Management

This paper analyses empirically the relationship between environmental innovations, environmental management and patenting. In particular it tests a number of propositions on how environmental management systems and the interaction with environmentally more or less concerned stakeholders are associated with the probability of firms to pursue innovation in general (measured as patenting behaviour) and specifically environmental innovation (measured as firm self-assessment and based on patent data). In applying a negative binomial as well as binary discrete choice models the relationship is studied using data on German manufacturing firms. As a novel and important insight, the study finds that environmental innovation can be meaningfully identified using patent data and that environmental innovation defined this way is less ubiquitous than self-reported environmental innovation. It also reveals that the implementation level of environmental management systems has a positive effect exclusively on environmental process innovation, whereas it is negatively associated with the level of a firm’s general patenting activities. For environmental product innovation and patented environmental innovations a positive relationship with environ-mentally concerned and a negative link with environmentally neutral stakeholders is found.