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The value of incremental environmental sustainability innovation in the construction industry: An event study

Duong, Linh N. K.; Wang, Jason X.; Wood, Lincoln C.; Reiners, Torsten; Koushan, Mona

Authors

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Dr Linh Duong Linh.Duong@uwe.ac.uk
Senior Lecturer in Operations Management

Jason X. Wang

Lincoln C. Wood

Torsten Reiners

Mona Koushan



Abstract

Investment in the innovation of environmental sustainability in construction has been encouraged due to the industry's resource-intensity. However, it remains unclear how to convince shareholders and construction companies to invest in environmental innovations. This research used the event study method with a sample of 129 announcements in the construction industry from 2011 to 2017 to investigate the relationship between incremental environmental sustainability innovation and the stock market reactions of construction firms. The research finds evidence that the stock market reaction has a strong positive relationship with these announcements. There is also evidence for a relationship between strategic alliance, capital turnover, and the project start date with the stock market reaction. The results provide insight into the benefits of incremental innovations in the construction industry and extend the literature of environmental sustainability innovation by considering contributing factors that affect the relationship between environmental sustainability innovation and firm performance. They provide a useful reference for shareholders to integrate environmental sustainability innovation into their business strategies and allocate their resources more efficiently.

Citation

Duong, L. N. K., Wang, J. X., Wood, L. C., Reiners, T., & Koushan, M. (2021). The value of incremental environmental sustainability innovation in the construction industry: An event study. Construction Management and Economics, 39(5), 398-418. https://doi.org/10.1080/01446193.2021.1901950

Journal Article Type Article
Acceptance Date Mar 9, 2021
Online Publication Date Mar 26, 2021
Publication Date Mar 26, 2021
Deposit Date Jul 23, 2021
Journal Construction Management and Economics
Print ISSN 0144-6193
Electronic ISSN 1466-433X
Publisher Taylor & Francis (Routledge)
Peer Reviewed Peer Reviewed
Volume 39
Issue 5
Pages 398-418
DOI https://doi.org/10.1080/01446193.2021.1901950
Keywords Sustainability; innovation; construction industry; event-study; stock market
Public URL https://uwe-repository.worktribe.com/output/7487314
Publisher URL https://doi.org/10.1080/01446193.2021.1901950