Are Subsidiaries More Prone to Pollute? New Evidence from the EPA's Toxics Release Inventory*

Don Grant and Andrew W. Jones

Social Science Quarterly, 2003, vol. 84, issue 1, 162-173

Abstract: Objective. Some scholars fear that because firms are no longer liable for the hazardous activities of their subsidiaries, the latter are under less corporate pressure to limit their pollution. However, researchers have yet to examine the environmental performance of subsidiaries. This reflects a more general failure on their part to test the effects different organizations have on pollution. Methods. To begin to remedy this situation, we use data from the EPA's Toxics Release Inventory to determine whether subsidiaries emit pollutants at a higher rate than other facilities in the chemical industry. Results. We find that subsidiaries have significantly higher emission rates than other facilities after controlling for several relevant factors. Conclusions. Results suggest how recent research on the structural determinants of environmental degradation might be advanced by focusing on the effects of specific organizational forms.

Date: 2003
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