Abstract
To fill up the gap that so far, the effects of corporate environmental management (CEM) on corporate economic performance (CEP) have not been empirically examined in Japan, we made an empirical test by using the archive data of Japanese manufacturing companies . Based on the previous studies and the current situation of Japan, we posited that proactive CEM has positive effects on CEP. Since we believe that the well-developed CEM have influence on corporate overall and long-term economic capacity rather than an aspect of CEP, we used the senior long-term credit rating (SLTCR) assigned by Rating and Investment Information Center, Inc. (R&I) to measure CEP. Using a sample of 1538 company-year observations from the period of 2000 to 2002 and utilizing the ordered probit modeling methods, we predicted R&I's SLTCR of August 2001 to 2003 . The results indicate that CEM has positive and significant effects on CEP in the current context of Japan, providing solid support for our hypothesis. This is consistent with most of the previous studies conducted in the US and Europe, implying that the companies proactive in CEM in Japan may also have opportunities to outperform their competitors.
