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Environmental Research
journal homepage: www.elsevier.com/locate/envres

It’s hard to be green: Reverse green value chain


João Couto a, Teresa Tiago a,n, Artur Gil b, Flávio Tiago c, Sandra Faria c
a
CEEAplA, University of the Azores and Advance/CSG, ISEG, Universidade de Lisboa, University of the Azores, Ponta Delgada, Portugal
b
Centre for Ecology, Evolution and Environmental Changes, University of the Azores, Ponta Delgada, Portugal
c
Advance/CSG, ISEG, Universidade de Lisboa and CEEAplA-Açores, University of the Azores, Ponta Delgada, Portugal

art ic l e i nf o a b s t r a c t

Article history: Firms have recently discovered that it is not enough to optimize internal processes and relationships
Received 31 July 2015 with partners along the value chain to create a sustainable competitive market position. A clear customer
Received in revised form orientation, which acknowledges that consumer buying behavior is complex and includes many ele-
12 March 2016
ments implied in the value chain, is required. As companies offering green products are no exception to
Accepted 3 May 2016
this rule, this study analyzes consumer behavior in Europe from a reserve green supply chain manage-
ment perspective, using descriptive analyses and a structural equation model, with data collected by
Keywords: Flash Barometer comprising 26,573 responses from 28 European countries. The results suggest that
Reverse green supply chain management European consumers are conscious of the green concept, but are not willing to buy or pay more for these
Green consumer
products since the value is unclear. Companies offering green products must therefore rethink their
Buying behavior
strategies, especially in terms of value proposition, communication strategies, and eco-labeling.
Europe
& 2016 Elsevier Inc. All rights reserved.

1. Introduction Bromiley et al. (2015) that a deeper look and new perspective are
needed regarding supply chain risk sources comprising uncertainties
Limiting green supply chain management (GrSCM) to the devel- arising from the supply chain–environment interaction, a path that has
opment of environment-friendly activities is a narrow vision of this already been followed by several authors (Wu et al., 2013; Choi et al.,
concept, as this management strategy seeks to optimize company 2015). Wu and Olson (2013) suggested that risks present four main
operations by ensuring sustainability at three levels: financial, en- characteristics: interconnection/dependence, complexity, uncertainty,
vironmental, and social. In the last two decades, this has led to an and dynamics. The latter two are the two last properties acknowl-
increasing body of work analyzing sustainable value chains. Some of edged by practitioners in the behavioral domain.
these studies focus on the processes (Bey, 2001), green design (Zhang Driven from these perspectives, the main challenges firms face
et al., 1997), low-carbon strategies (Hsu et al., 2013), or industrial in adopting a green supply chain management approach involve
ecosystems (Nasr, 1997; Zhu and Sarkis, 2004) and networks. Within internal process optimization (Ferrer and Whybark, 2001; Klein-
this sample, a wide body of literature from diverse fields has dorfer et al., 2005), and understanding the effects of this change at
emphasized on supply chain vulnerabilities and risks. Wu and Olson the level of the external elements. These external elements include
(2013) defined risk management as the process of identification, competition (Martin and Matlay, 2001), suppliers (Guide and Van
analysis, and either acceptance or mitigation of uncertainty in in- Wassenhove, 2002), social responsibility, risk (Wu et al., 2015) and,
vestment decision-making. Jüttner et al. (2003) pointed toward the above all, consumers (Guide and Van Wassenhove, 2009).
lack of ownership, chaos, and inertia as the main sources of However, only a small number of studies analyze the last ele-
uncertainty and risks. The ownership problems are related to the ment in this chain: the consumer. This work aims to contribute
distortion of boundaries between buying and supplying firms oper- toward bridging this gap by analyzing how consumers value green
ating in the supply chain. The chaos construct is linked to the com- products and services. In other words, this work aims to determine
plexity forces operating in a supply chain, and the diversity of different the dimensions by which consumers assign value at the time they
agents’ goals. The last source, inertia, is linked to the lack of respon- choose between products to consume. To this end, we analyzed
siveness to environmental changes (Van Hoek, 1999; Wu et al., 2013) data from 26,573 respondents in 28 European countries.
and market signals. This last point underlies the suggestion by

n
2. Background
Corresponding author.
E-mail addresses: joao.pa.couto@uac.pt (J. Couto),
maria.tp.tiago@uac.pt (T. Tiago), artur.jf.gil@uac.pt (A. Gil), The present context constantly challenges corporate managers
flavio.gb.tiago@uac.pt (F. Tiago), sandra.mc.faria@uac.pt (S. Faria). to maintain a competitive advantage through several processes

http://dx.doi.org/10.1016/j.envres.2016.05.006
0013-9351/& 2016 Elsevier Inc. All rights reserved.

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
j.envres.2016.05.006i
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(Porter, 2001) such as: improving production processes, estab- Table 1


lishing strong relations with stakeholders, and acquiring and ap- GrSCM terminology.
plying knowledge.
Publication Terminology
Firms have begun to realize the importance of closely mana-
ging activities in the supply chain to create additional value, which Cucchiella et al. (2012) Sustainable supply network management
can be grounds for significant competitive advantages. Since the Carter and Rogers (2008)
early 1980s, the supply chain management concept has been Svensson (2007)
Young and Kielkiewicz-Young
widely studied (Chen and Paulraj, 2004; Harland, 1996; Ngai et al., (2001)
2008). Much research has emerged from different fields, especially Cruz (2008) Supply and demand sustainability in cor-
logistics/distribution and marketing. More recently, this body of Orlitzky et al. (2011) porate social responsibility networks
literature is complemented by studies in the information tech- Sharfman et al. (2009) Supply chain environmental management
Lippman (2001)
nology field (Nagurney et al., 2002) and in ecological management
Lippmann (1999)
and industrial ecology (Cucchiella et al., 2012; Erkman, 1997). Green et al. (1998) Green purchasing
Oliver and Webber (1992) surveyed North American, European, Min and Galle (1997)
and Japanese firms, and concluded that traditional distribution Zhu et al. (2013) Green procurement
channel management did not create the expected results. This Nagel (2000)
Moser (2015) Environmental purchasing
conclusion generated the supply chain management (SCM) con- Tate et al. (2012)
cept, which remains relevant in the literature from distinct areas Zsidisin and Siferd (2001)
(Park and Suresh, 2005; Park et al., 2013; Rayport and Sviokla, Nagel (2000) Environmental supply chain
1995; Simatupang and Sridharan, 2002). Dekker et al. (2012) Green logistics
Murphy and Poist (2003)
According to Porter and Kramer (2011), SCM is a model that
González-Benito and González- Environmental logistics
describes the sequential activities that add value to an organiza- Benito (2006)
tion. It establishes the connection between demand (raw materi- Carter and Rogers (2008) Sustainable supply chains
als, entry logistics, and production process) and supply (output Linton et al. (2007)
logistics, marketing, and sales), and includes support activities Walton et al. (1998) Green supply chain

(infrastructures, human resources, and R&D, among others) in its


approach.
Due to the body of research in the field, SCM is now considered
a generic management concept composed of the systemic im- The center of Fig. 1 shows the interaction between lean pro-
plementation of processes (Svensson, 2003); it is a series of value- duction and green concerns as vital to the success of any GrSCM
added activities that connects a company's supply (raw materials, initiative. Managers must usually decide between lean, agile, and
inbound logistics, and production processes) to its demand (out- leagile models in the SCM design (Purvis et al., 2014). Lean stra-
bound logistics, marketing, and sales). Growing environmental tegies have demonstrated their usefulness in reducing costs
concerns led to an emerging awareness that efforts in supply chain (Chiarini, 2014), by mapping and controlling all waste production
management should focus on diminishing the environmental and carbon footprints. A leagile configuration will also work for
footprint. Accordingly, the GrSCM notion emerged when en- firms that operate in truly competitive markets, since it combines
vironmental concerns are combined with supply chain manage- high efficiency with a high degree of responsiveness, and therefore
ment concerns. Srivastava (2007) stated that GrSCM has its roots enables diminishing environmental impacts and water and energy
in both environmental management and supply-chain manage- consumption (Hsu et al., 2013).
ment literature. As noticed by Sarkis et al., (2011), over the past As shown in Fig. 1, firms are required to manage all conven-
years, the literature has varied significantly in its definition of tional SCM economic criteria and environmental principles si-
GrSCM, as well as its use of terminology around this term (see multaneously to meet the “triple bottom line approach” (social,
Table 1): economic, and environmental issues), which leads to a viable re-
A common thread throughout these works is the notion that, re- lationship between economic prosperity and environmental con-
gardless of the terminology adopted, environmental concerns should servation and protection. This approach creates an endless chain,
be integrated into the inter-organizational SCM practices. However, as it considers consumers as both end-users during consumption
the focus of analysis changed, as well as the general organizational and as prime material suppliers when they return old products for
theories underlining it (Sarkis et al., 2011). Sarkis et al. (2011) identified reintroduction into other supply chains. In their consideration of
nine organizational theories: (1) complexity theory; (2) ecological this endless triple bottom line approach, Zhu et al. (2013) argued
modernization; (3) information theory; (4) resource-based view; that it is urgent to develop and apply suitable policies that sti-
(5) resource dependence theory; (6) transaction cost economics; mulate a green mindset in terms of design, supply chain, lean/
(7) social network theory; (8) stakeholder theory; and (9) institutional leagile production, worker health and safety, and consumer
theory. In the last three, stakeholders such as governments and con- protection.
sumers effectively pressure firms to incorporate more sustainability Seuring and Müller (2008) proposed a figure similar to Fig. 1,
into their SCM (González-Benito and González-Benito, 2006; Seuring though it included only new products and suggested that in most
and Müller, 2008). works, sustainable development is often measured through en-
In this context, the notions of green purchasing (Green et al., vironmental improvements. However, as Wu and Cheng (2008)
1998), green logistics practices (Dekker et al., 2012; González-Be- suggest, successful SCM requires choosing a suitable type of re-
nito and González-Benito, 2006), and environmentally-oriented lationship between product and market conditions and adopting
reverse logistics (González-Torre et al., 2010) are combined to re- management practices accordingly. Therefore, as in Fig. 2, this
spond to stakeholders and effectively manage the product life- study considers SCM for “sustainable” products as a reverse lo-
cycle. Moreover, this perspective led to the development of closed- gistics process that includes consumer perceptions and behavior
loop supply chains (CLSC), which focus on taking products back toward “sustainable” products as key elements of the value chain.
from customers after regular consumption and reusing its com- The arrows represent the relationships among the different
ponents or the entire product to generate new added value (Guide players and their influences on the GrSCM. Earlier studies indicate
and Van Wassenhove, 2009). that sustainability is often externally motivated by actors such as

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
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Fig. 1. Integrated green supply chain.

government, customers, or stakeholders, which results in the re- consumers’ buying decisions in terms of green products (Sheth
flection of their own environmental concerns and sustainability et al., 2011; Shrum et al., 1995; Steg et al., 2005). Additionally, the
practices. This Reverse Green Supply Chain approach to sustain- Nicosia Model (Nicosia, 1966) established the link between the
ability and profitability in activities, processes, and products in the consumer and the firm, emphasizing the firms’ relevance in ad-
value chain promotes the reverse supply chain as a method to vertising messages and other forms of communication to enhan-
recapture value. However, some influential relationships are not cing predispositions to consumption and to supporting the de-
illustrated in the figure in terms of the outcomes of the GrSCM velopment of consumer attitudes toward the product and brand.
approach. For instance, Hoekstra (2015) established a direct link However, when analyzed separately, these variables con-
between product life cycle and environmental pressures, and siderably limit the understanding of the green consumer, espe-
suggested that distinct potential environmental impacts and in- cially in the full buying decision process (Fig. 3), which is already
fluences can arise during the life cycle of a product. Therefore, a applied in other marketing fields (Kim et al., 2012; Nicosia, 1966).
customer- and environment-oriented reverse supply chain ap- The external and internal factors presented in the left circle
proach is required to fully understand customer attitudes and play a decisive role in pro-environment consumer behavior, and
buyer behaviors toward green or sustainable products. can vary considerably between countries (Ritter et al., 2014; Per-
The notion of green consumption has been covered and ex- eira and Almeida, 2014). Most research has focused on these
tended in several articles since the 1970s. Some of the earliest components and on their influence in all five stages, and most
works found that a large majority of US citizens considered results show that individuals with higher environmental aware-
themselves to be environmentalists, regardless of their current ness tend to better understand green products’ positive ex-
buying behavior (Mainieri et al., 1997a, 1997b; Roberts, 1996). Over ternalities, and are more likely to consume them on a regular basis
four decades, several models attempted to establish the elements (Kim et al., 2012; Moser, 2015). Moreover, Mainieri et al.’s (1997a)
that determine and influence consumer behavior toward green results showed that pro-environmental behavior has its main
product consumption (see Table 2). roots in regular exposure to this concept and its associated prac-
Several studies reported on the influence of traditional seg- tices. This demonstrates influences from internal and external
mentation variables (socio-demographics) and psychographics on elements in all five stages of the buying decision model.

Fig. 2. Reverse green supply chain.


Source: Adapted from Sarkis (2003)

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
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Table 2
Criteria affecting green consumer behavior.

Type of influence Concept Indicators References

Internal Demographics and environmental knowledge Gender, age, income, education Shrum et al. (1995)
Steg et al. (2005)
Psychographics Attitudes and values Minton and Rose (1997)
Steg et al. (2005)
Sheth et al. (2011)
External Public and governmental Promotion, educational programs Nicosia (1966)
Childers and Rao (1992)
Firms Promotion, advertisement, labeling, packaging Shannon et al. (2002)
Green products availability Retail strategy Mainieri et al. (1997a)
Other influencers Culture, family, friends, opinion-leaders Moser (2015)

Nevertheless, the buying process is not complete if it does not confidence regarding sustainable consumption, which allowed for
consider elements from the circle on the right. Green consumers’ a deeper investigation into their mindsets. Fig. 4 illustrates the
mindsets acknowledge the environmental issues driven by in- methodological approach applied in the Eurobarometer.
tensive production/consumption, and may show changing buying
motivations. Consumer behaviorists believed that attitudes predict 3.1. Conceptual model
individuals’ actions and behaviors (Ajzen, 1991), and thus form the
essence of consumer habits. Solomon et al. (2014) also argued that The aim of our work was to analyze how consumers assess and
buyer behavior relies on buying, having, and being. decide to buy green products and services by using a reverse
Therefore, green consumer behavior is not a simple matter. It perspective of the green value chain that emphasizes one of the
includes internal and external influences that need to be con- last risk dimensions to consumer behavior dynamics and market
sidered. In light of these challenges, this research addresses the signals (Bromiley et al., 2015). As Wu et al. (2015) suggested,
following questions about green buyer behavior: several types of models have been proposed to support risk
management within organizations, and these models have lately
1. How knowledge about green products influences consumer focused on supply chain management. However, there are scarce
willingness to pay for or buy these products? references to analyses that look into consumer behavior as a risk
2. What are the most prevalent elements considered by con- source, as happens when the consumer does not value the firms’
sumers in the perceived value composition? product value proposition, especially when it concerns a sustain-
3. Does perceived value have a positive impact on buying deci- able or green approach. Therefore, looking to the future of a green
sions and willingness to pay or buy green products? supply chain requires an examination of the dynamic nature of
4. To what extent do the traditional marketing mix elements green-conscious consumer behavior.
controlled by firms and accounted for in the buying decision Despite the recent attention on multiple dimensions of sus-
influence the buying decision? tainability, some aspects of green product consumption influence
consumers’ predispositions to buying green products or behaving
in an environmentally friendly manner, which in turn affect the
3. Methods overall results from a GrSCM. These should be considered when
focusing on green product consumption.
To help answer these questions, this paper uses the data To fully understand green consumer behavior and motivations,
gathered by the Flash Eurobarometer 367 on Attitudes of Europeans and its impact on reverse GrSCM, consumer ambivalence towards
towards building the single market for green products, examining EU green products requires a deeper analysis:
citizens’ knowledge of green products and their reasons for buying
or not buying environmentally friendly products. This data source 1. Willingness to pay/buy: consumers do not directly define product
allowed us to investigate the willingness to pay for or buy green designs, features, and production processes. However, their buying
products, particularly those products that have a green supply decisions and willingness to pay can establish successful and un-
chain process, because participants were questioned about their successful products (Solomon et al., 2014). As posited by Zeithaml
behaviors and attitudes toward environmental friendly products. et al. (1996), purchase intention and willingness to pay are two of
Furthermore, they were questioned about their habits, actions, and the main actions linked to consumer behavioral intentions (Ajzen,

Fig. 3. Buyer decision process.

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
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Fig. 4. Methodology approach of Eurobarometer.

1991; Ajzen et al., 2009). When looking at green consumer buying environmentally friendly behavior (Lin and Huang, 2012).
behavior, Prochaska and DiClemente's model (1986) indicates that 4. Buying decision process: of the five stages, the evaluation of
behavioral changes evolve over six phases: pre-contemplation, alternatives has received less attention. However, consumers
contemplation, preparation, action, maintenance, and habit, and evaluate dimensions such as quality, brand name, design, and
willingness to buy varies in each stage. price compared to competitors, which is why, for instance,
2. Product information: economic theory establishes that con- Gleim et al. (2013) suggested that green product prices can
sumers need clear and credible market information to rationally influence purchasing decisions.
decide what to buy and to determine the product's perceived
value (Stiglitz, 2002). The sources of information that mold Recognizing the importance of these last dimensions on con-
consumer behavior and intention may vary, and this produces sumer willingness to pay or buy green products, the following
different outcomes (Tam and Ho, 2006; Levin and Gaeth, 1988). conceptual model was established (Fig. 5):
3. Value perception: along with recognizing the higher value of green Fig. 5 illustrates the model proposed to explore and reduce the
products, skepticism toward a firm's motives and competence often uncertainty of consumers’ pro-environmental purchasing behavior
exists, and consumers often express greenwashing concerns (Ritter motivations and habits.
et al., 2014). An individual's intention toward a product can be Each dimension is supposed to contribute directly to the de-
either favorable or unfavorable, reflecting not only the product
termination of the behavior intentions – willingness to pay/buy.
value proposition but also a certain emotional consumer commit-
However, besides these direct effects, it is also assumed that there
ment (Kim and Choi, 2005) that reflects the affinity of consumer
are indirect effects caused by perceived value. In light of the above
personal values with the value proposition posited by the firm or
the product (Mainieri et al., 1997a). Moreover, evidences show a discussion, the following hypotheses were constructed for testing
positive correlation between environmental concern and in this study:

Fig. 5. Conceptual model.

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
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H1. : the product information factor positively and significantly respective nationalities of the European Union Member States,
determines the willingness to pay or buy; including foreign residents in each of the 27 Member States and
Croatia, aged 15 years and over. Some 26,573 respondents from
H2. : the product information factor positively and significantly
different social and demographic groups were interviewed via
implies the perceived value;
telephone (landline and mobile phone) in their mother tongues.
H3. : the perceived value factor positively and significantly influ- The basic sample design applied in all states is multi-stage random
ences the buying decision process; (probability). The sample is stratified by NUTS2 region and urba-
nization to be geographically representative.
H4. : the perceived value factor positively and significantly de- The following was reported in the survey technical specifica-
termines the willingness to pay or buy; tions report:
H5. : the factor concerned with the buying decision process po-
“This survey has been requested by the EUROPEAN COMMIS-
sitively and significantly leads to paying and buying behavior
SION, Directorate-General for Environment. It is a general
intentions.
public survey coordinated by the Directorate-General for
This study considers a green consumer as any individual whose Communication (“Research and Speechwriting” Unit). The
buying decision behavior is influenced by environmental concerns. FLASH EUROBAROMETER 367 covers the population […] aged
This means that green consumers are those who actually buy 15 years and over. The survey covers the national population of
green products on a regular basis and those who intend to buy in citizens as well as the population of citizens of all the European
the near future. Additionally, green products are products that are Union Member States that are residents in these countries and
perceived by consumers as environmentally friendly – in other have a sufficient command of the national languages to answer
words, those that do not harm the environment when they are the questionnaire. […] In every country respondents were
made, used, or disposed of. called both on fixed lines and mobile phones. The basic sample
design applied in all states is multi-stage random (probability).
3.2. Methods and techniques In each household, the respondent was drawn at random fol-
lowing the “last birthday rule” (European Commission, 2013).
Because buying is at the end of the green supply chain, green
The adoption of this database provides access to a considerable
supply chain efforts cannot be successful without integrating the
number of participants (26,573), covering 28 countries in Europe.
consumers' environmental attitudes and behaviors. Therefore,
We choose to work with data gather by a third party, acknowl-
after delineating three dimensions as the main influencers of
edging that we wouldn’t be able to change or adequate the
green consumption, considering their theoretical antecedents, and
questionnaire. However, their questionnaire was suitable for our
aiming to assess the existence of an empirical association between
purposes and the sample size was quite difficult to gather in-
several theoretical constructs (Goldeberger, 1972) – as described in
dependently. This is a random probabilistic sample that can be
the conceptual model – a structural equation modeling (SEM) was
conducted. This model consists of two sub-models and implies seen as representative of the European countries covered. The
performing several statistical techniques within a family of related analysis we performed enhances the originally conducted data
procedures. This statistical procedure is commonly adopted in treatment, since they do not test and estimate the links between
social and behavioral sciences (Bagozzi and Yi, 1988) when trying the different variables. The estimation of a structural model allows
to estimate, in multiple-group populations, a set of multiple re- us to enhance the knowledge and test the relationships between
gressions with latent variables having multiple indicators (Mulaik, the conceptual dimensions found in the literature.
1998). In the present work, the SEM is proposed with a generalized The survey conducted by phone by the TNS Political & Social
measurement part, which allows the use of continuous variables, network in the 27 member states of the European Union and in
as well as dichotomous and ordered categorical variables, also Croatia cover five dimensions of analysis: (1) behaviors and atti-
known as indicators. The measurement model shows how the tudes toward environmentally friendly products; (2) the influence
latent variables or factors are measured and the structural equa- of environmental considerations on consumption habits; (3) ac-
tion model indicates the relationships among the latent variables. tions for the environment; (4) consumers’ confidence about en-
The validation of the measurement model is done by using Con- vironmental claims; and (5) sustainable consumption. Due to the
firmatory Factor Analysis (CFA) (Chen, 1998). Afterwards, the aim of this work, from those five dimensions, four sets of variables
model is estimated in the AMOS 19 package. where chosen, as presented in Table 3.
We suppose that product information, perceived value, and the
buying decision process factors each have a direct effect on the
willingness to pay for or buy green products, as well as indirect 4. Results and discussion
effects through the buying decision process. Therefore, we assume
that the behavior intentions are explained not only by the product Considering the richness of the data source used in this work
but also by the perceived value factor and a factor concerned with and to render a greater sensitivity to the data (Sekaran, 2006), the
the five stages of the buying decision process. first level of analysis comprises a descriptive analysis approach,
which presents the overall results with a focus on some national
3.3. Data description differences found in the main domains.
In the second phase, we investigate the relation between pro-
Since there are only a few studies that analyze green consumer duct information, perceived value, and the buying decision process
motivations and habits, and these mostly focus on consumers in in terms of what influences consumers’ willingness to pay for or
North America and China, this work focuses on green consumers buy green products. For this purpose, a structural equation model
in Europe. The data used for this study was obtained from a survey with latent variables was used. Therefore, in the first stage, the
provided by the European Commission, Directorate-General for measurement model was estimated, supported by a confirmatory
Environment. It is a general public survey coordinated by the Di- factor analysis where all constructs were measured using multi-
rectorate-General for Communication. The Flash Eurobarometer items scales drawn from previous studies that reported high sta-
367 (European Commission, 2013) covers the population of the tistical reliability and validity (Chen, 1998). Afterwards, we

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
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Table 3
Variables used.

Dimensions Variables from the questionnaire Literature support

Buying Decision Group Q2 Gleim et al. (2013)


Q2.1: Would you say that when making a decision on what products you buy, the product's impact
on the environment aspects is important?
Q2.2: Would you say that when making a decision on what products you buy, the price of the
product aspects is important?
Q2.3: Would you say that when making a decision on what products you buy, the quality of the
product aspects is important?
Q2.4: Would you say that when making a decision on what products you buy, the brand or the brand
name of the product aspects are important?
These variables are measured on a Likert scale of 1 to 4, from very important to not important at all.
Product Information Group Q11 Stiglitz (2002)
Q11.1: Where would you like to find environmental information about a product? Levin and Gaeth (1988)
Tam and Ho (2006)
On the shelf where the product is placed.
Q11.2: Where would you like to find environmental information about a product?
In advertisements about the product on/in TV/radio/newspapers.
Q11.3: Where would you like to find environmental information about a product?
On the Internet.
Q11.4: Where would you like to find environmental information about a product?
In a leaflet in the shop.
Q11.5: Where would you like to find environmental information about a product?
On a bar code that can be scanned by a smartphone or a device provided in the shop.
Q11.6: Where would you like to find environmental information about a product?
On the product itself, on a label.
These variables are on a categorical scale.
Perceived Value Group Q4 Ritter et al. (2014)
Q4.1: EFPs are good value for money Mainieri et al. (1997a)
Q4.2: EFPs are as effective as regular products Kim and Choi (2005)
Q4.3: You feel that using EFP is the right thing to do Lin and Huang (2012)
Q4.4: Buying EFP sets a good example
Q4.5: Buying EFP can make a real difference to the environment
Q4.6: Your family or friends will think it is a good thing if you use EFP
These variables are measured on a Likert scale of 1 to 4, from strongly agree to strongly disagree.
Willingness to pay Group Q6: How much more, if anything, would you be willing to pay for products if you were confident Zeithaml et al. (1996);
that they were more environmentally friendly?: You would not be willing to pay more (1), You would Prochaska and DiClemente (1986); Solo-
be willing to pay 5% more (2), You would be willing to pay 6% to 10% more (3), You would be willing to mon et al. (2014)
pay 11% to 20% more (4), You would be willing to pay more than 20% (5).
These variables are measured on a Likert scale from 1 to 5, in which each level represents a higher
level of payment differential.

estimated a structural equation model, since these models have friendly will cause less damage to the environment than other
the capacity to represent causal relationships among the variables products. Furthermore, 13.8% consider themselves fully confident
(Fox, 2002; Mulaik, 1998). and 30.5% are not confident regarding these products. Similar
numbers are acknowledged when respondents were questioned
4.1. Overall data interpretation regarding their trust in producers’ claims about the environmental
performance of their products: most Europeans tend to trust these
Covering the 27 Member States of the European Union and also claims (53.3%), 4.2% trust them completely, and 42.5% tend to not
Croatia, the sample size is n¼ 26573, of which 11,002 (41.4%) are trust them at all.
males and 15,571 (58.6%) are females. In terms of age, 24.9% are Within Europe, Austria, Germany, and Sweden display a higher
over sixty five years old, 20.6% are between 55 and 64 years old, percentage of consumers whose buying behavior is influenced by
27.9% are between 25 and 54 years old, and 8.4% are between 15 greater environmental awareness. Occasional buyers are mainly
and 24 years old. Among the people questioned, 2654 are self- located in the Netherlands and Finland, while in Romania, Malta,
employed (10.0%), 8342 are employees for third parties (31.4%), and Bulgaria, most consumers do not currently buy, nor intend to
1940 are manual workers (7.3%) and 13,540 are not working buy, such products.
(51.0%). As far as educational degree is concerned, 1491 (5.6%) of In terms of actions considered to positively affect the en-
respondents are still studying, with 2896 in high school (10.9%), vironment, the most commonly cited are recycling and minimizing
9668 (36.4%) college-graduated, 11,988 (45.1%) with Master's and/ waste, followed by buying low energy consuming home appli-
or PhD degrees, and 152 with no full-time education (0.6%). Most ances, insulating houses and apartments, buying local agricultural
people (11,563 or 43.5%) live in a two person-household, 5744 live products, travelling less and adopting sustainable models of
alone, and 9162 live in households with more than three people. transportation, using less water, and buying products from eco-
Most Europeans can be considered occasional consumers of friendly producers. There is a consensus among Europeans that
environmentally friendly products (53.6%), while about a quarter buying environmentally friendly products can make a difference
buy these products on a regular basis (26.4%); 8.3% do not buy but for the environment.
intend to do so in the near future. Additionally, European con- Once again, the results show very different patterns of concern
sumers recognize these products as great value for money. Most among European countries. Looking closely, while the average
respondents (50.8%) stated that they are fairly confident that importance of buying products from eco-friendly producers is 22%,
products labeled or otherwise indicated as environmentally this attribute is highest among Austrians, where 34% value these

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Table 4 Similar evidence can be found in Ritter et al.’s (2014) study on


Confirmatory factor analysis. North American consumers. Less than half of EU consumers rely
on producers’ environmental claims regarding production and
Constructs Factor Cronbach α Average
loading environmental product features.
Variance The results show a strong association between environmentally
extracted friendly consumption and age and education. For instance,
younger consumers show less willingness to buy green products,
Buying Decision
Product’s impact on the 0.42*** 0.448 0.376 whereas more educated consumers have a higher consumption
environment level.
Price of the product 0.13***
Quality of the product 0.54***
Brand name of the product 0.32***
4.2. Estimated results

Following the descriptive data treatment effort, a confirmatory


Product information
On the shelf where the product is 0.28 ***
0.60 0.354
factor analysis (CFA) was conducted to determine the standardized
placed loading for items on all scales (see Table 4). This enabled the cal-
***
In advertisements about the 0.56 culation of the average variance extracted, which confirmed the
product convergent and discriminant validity of the scales (Chen, 1998).
On the Internet 0.56***
In a leaflet in the shop 0.59***
Initial measures were derived from the literature, and multi-items
On a bar code that can be scanned 0.49*** scales drawn from Flash Eurobarometer 367, which measured the
by a smartphone concepts mentioned in the literature review, were used.
On a label on the product itself 0.17*** The composite reliability and average of variance-extracted
values are above 0.5, indicating that all measurement variables are
Perceived value significantly related to each of the corresponding constructs. The
EFPs are good value for money 0.40*** 0.746 0.441 Cronbach's α values for all constructs that are used to evaluate
EFPs are as effective as regular 0.25***
products
construct reliability returned results above 0.7, confirming dis-
You feel that using EFPs is the 0.65*** criminant validity for all scales, as reported in Table 1. Although
right thing to do there are two variables with low factor loadings, they are included
Buying EFPs sets a good example 0.66*** because they are relevant and supported by earlier studies (Engel
Buying EFPs can make a real dif- 0.62***
et al., 1995; Solomon et al., 2014).
ference to the environment
Your family or friends will think it 0.55*** After confirming the uni-dimensionality of each construct, the
is a good thing if you use EFPs hypotheses were evaluated using a structural model assessed
using goodness-of-fit measures. The overall fit indices for the
***
All factor loadings are significant at the p o 0.001 level. proposed model were acceptable, with χ2/df ¼ 55.273, root mean
square error of approximation (RMSEA) of 0.036, normed fit index
products, followed by Sweden, where 29% value these products. (NFI) of 0.903, comparative fit index (CFI) of 0.905, and goodness-
On the other hand, in countries like Estonia, Ireland, and the UK, of-fit index (GFI) of 0.905. All fit indices for the final model in-
only 15% of consumers value these products. dicated an acceptable structural model fit (Mulaik, 1998).
Nevertheless, although European consumers stated that they Five hypothesized paths were tested for significance, with re-
are willing to pay more for environmentally friendly products, sults reported in Table 5 and Fig. 6. The results indicate that all
they are skeptical of eco-labels and greenwashing practices. paths were significant at p o .001 in the structural model.

Table 5
Standardized regression weights.

Dependent variables Independent variable Estimate S.E. C.R. P

Product’s impact on the environment o— Buying decision 1.000


Price of the product o— Buying decision 0.122 0.012 10,550 ***
Quality of the product o— Buying decision 0.382 0.012 31,593 ***
Brand name of the product o— Buying decision 0.419 0.017 24,471 ***
On the shelf where the product is placed o— Product information 1.506 0.050 29,919 ***
In advertisements about the product o— Product information 1.000
On the internet o— Product information 1.904 0.057 33,355 ***
In a leaflet at the shop o— Product information 2.189 0.066 33,392 ***
On a bar code that can be scanned by a smartphone o— Product information 2.107 0.063 33,211 ***
On a label on the product itself o— Product information 2.021 0.062 32,564 ***
EFPs are good value for money o— Perceived value 1.000
EFPs are as effective as regular products o— Perceived value 1.936 0.053 36,278 ***
You feel that using EFPs is the right thing to do o— Perceived value 1.880 0.052 36,404 ***
Buying EFPs sets a good example o— Perceived value 1.983 0.054 36,689 ***
Buying EFPs can make a real difference to the environment o— Perceived value 1.409 0.040 35,205 ***
Your family or friends will think it is a good thing if you use EFP o— Perceived value 0.528 0.026 20,133 ***
Perceived value o— Perceived value  0.120 0.014  8,605 ***
Buying decision o— Product information 1.383 0.046 29,933 ***
Willingness to pay/buy o— Perceived value 1.000
Willingness to pay/buy o— Product information  0.603 0.062  9,806 ***
Willingness to pay/buy o— Buying decision  0.245 0.028  8,709 ***

nnn
α 40,001. Note: EFP: Environmentally friendly product.

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j.envres.2016.05.006i
J. Couto et al. / Environmental Research ∎ (∎∎∎∎) ∎∎∎–∎∎∎ 9

Fig. 6. Structural model results.

The hypotheses can be verified using the standard regression process and willingness to pay.
weights and their significance levels, which are reported in
Table 5.
By testing the relationships between perceived value and 5. Discussion and conclusions
buying decision process, values were found to impact willingness
to pay or buy negatively, thus not supporting H5 and H4. Product It is a challenge to be a green producer, since it involves many
information was found to affect willingness to pay or buy posi- influencing factors. Green consumption is no exception, as the
tively, thus supporting H1. Furthermore, the positive relationship consumer's decision-making process is highly influenced by the
between the perceived value and buying decision process was perceived value of green products. However, a paradox emerges
confirmed, and so H3 was accepted. when we look at the results from the structural model: direct
As hypothesized, green product willingness to pay or buy is action does not reflect consumer intentions.
positively influenced by all of the factors under the product in- Since price can be a determinant in differentiating regular
formation dimension, with the information provided in the leaflet consumers from occasional consumers, lowering the price gap
at the shop being the most impacting. However, the other two between green and traditional alternatives may increase con-
main dimensions considered were not found to impact green sumption. However, firms should conduct a deeper cost-benefit
product willingness to pay or buy positively. analysis since reluctant consumers consider these products to be
Hypothesis 1. : in summary, which stated that product informa- good value for money, suggesting that price is not the only factor
tion has a positive effect on willingness to pay, was supported. The preventing them from purchasing green products, as suggested by
results show a path coefficient between the two constructs of 0.11, the structural model results.
which was positively significant at p o0.001. Producers of environmentally friendly products may, however,
be concerned about consumer perceptions of the effectiveness of
Hypothesis 2. : stated that product information has a positive these products compared to regular products, the lack of cred-
effect on perceived value. This hypothesis was not supported, as ibility of product labels, and the relative importance of price.
the path coefficient between the two constructs was  0.08 These results reveal a distinct reality in Europe compared to
(p o0.01). North America, since the relationships differ. Product in-
formation's negative relation to perceived value suggests that the
Hypothesis 3. : which stated that perceived value has a positive
information available to consumers in Europe is neither sufficient
effect on the buying decision process, was supported. The results
nor effective. The relationship between perceived value and will-
returned a path coefficient between the two constructs of 0.56,
ingness to pay indicates that consumers in Europe, though ap-
which was positively significant at p o0.01.
preciative of green products, do not consider them as being sig-
Hypothesis 4. : which stated that perceived value has a positive nificantly different from regular products, in terms of value.
effect on willingness to pay, was not supported with a path coef- The negative connection between the buying process and
ficient of  0.10 (p o0.01). willingness to pay may be because product quality, environmental
impact, and brand name are the main factors influencing the
Hypothesis 5. : which stated that the buying decision process has
buying process, and price shows a low relevance. Consequently,
a positive effect on willingness to pay, was rejected, as the path
willingness to pay is associated with other constructs that limit
coefficient between the two constructs was  0.10 (p o0.001).
the capacity to motivate consumers to pay for or to buy en-
The structural model results demonstrated a strong relation- vironmentally friendly products.
ship between perceived value and the buying decision process, as The product's environmental impact has no relevance for reg-
well as a positive relationship between product information and ular or occasional buyers, but it is mentioned as a relevant aspect
willingness to pay. However, the results show no positive re- for reluctant consumers.
lationship between product information and perceived value, The results from the confirmatory factor analysis of the buying
perceived value and willingness to pay, and the buying decision decision construct show that product quality, the product's

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
j.envres.2016.05.006i
10 J. Couto et al. / Environmental Research ∎ (∎∎∎∎) ∎∎∎–∎∎∎

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Joâo Pedro Almeida Couto is Associated Professor at
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University of Azores, Ph.D. In International Business,
Porter, M.E., Kramer, M.R., 2011. Creating shared value. Harv. Bus. Rev. 89 (1/2),
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the Department of Economics and Management
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Council and coordinates the management section.
Springer. Teaches Management Introduction, Strategic Manage-
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ment and International Business. He is a Research Fel-
supply network taxonomy based on differing types of flexibility. Int. J. Prod. low at the Centre of Applied Economics Studies of the
Econ. 151, 100–111. Atlantic – University of the Azores and Advance/CSG,
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(6), 75–85. include Strategic Management, Entrepreneurship, In-
Ritter, Á.M., Borchardt, M., Vaccaro, G.L., Pereira, G.M., Almeida, F., 2014. Motiva- ternational Business and Marketing. He has published
tions for promoting the consumption of green products in an emerging coun- several articles in international journals such as the
try: exploring attitudes of Brazilian consumers. J. Clean. Prod. 106, 507–520. Tourism Management, Business Horizons, Journal of Business and Economic
Roberts, J.A., 1996. Green consumers in the 1990s: profile and implications for Management, Multinational Business Review, Journal of the American Academy of
advertising. J. Bus. Res. 36 (3), 217–231. Business, Journal of Comparative International Management among others.
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Sarkis, J., Zhu, Q., Lai, K.-h, 2011. An organizational theoretic review of green supply
chain management literature. Int. J. Prod. Econ. 130 (1), 1–15. Maria Teresa Borges Tiago is Assistant Professor at Uni-
versity of Azores, Ph.D. in International Marketing, and
Sekaran, U., 2006. Research Methods for Business: A Skill Building Approach. John
has the MsC and MBA by the Portuguese Catholic Uni-
Wiley & Sons.
versity. She teaches marketing courses and is a Research
Selden, T.M., Song, D., 1994. Environmental quality and development: is there a
Fellow at the Centre of Applied Economics Studies of the
Kuznets curve for air pollution emissions? J. Environ. Econ. Manag. 27 (2),
Atlantic – University of the Azores and Advance/CSG,
147–162.
ISEG - Lisbon University. Her main research interests
Seuring, S., Müller, M., 2008. From a literature review to a conceptual framework
include Digital Marketing, Social Media, Entrepreneur-
for sustainable supply chain management. J. Clean. Prod. 16 (15), 1699–1710.
ship and Tourism. She has published several articles in
Shannon, C., Story, M., Fulkerson, J.A., French, S.A., 2002. Factors in the school ca-
internationals journals such as Management Research
feteria influencing food choices by high school students. J. Sch. Health 72 (6),
News, Journal of Business and Economic Management,
229–234.
Business Horizons, Tourism Management, among others.
Sharfman, M.P., Shaft, T.M., Anex, R.P., 2009. The road to cooperative supply-chain
environmental management: trust and uncertainty among pro-active firms.
Bus. Strategy. Environ. 18 (1), 1–13.
Sheth, J.N., Sethia, N.K., Srinivas, S., 2011. Mindful consumption: a customer-centric Artur Gil holds a PhD. in Environmental Science from
approach to sustainability. J. Acad. Mark. Sci. 39 (1), 21–39. the University of the Azores (Portugal). He is currently a
Shrum, L., McCarty, J.A., Lowrey, T.M., 1995. Buyer characteristics of the green Post-Doctoral Research Scientist in Applied Remote
consumer and their implications for advertising strategy. J. Advert. 24 (2), Sensing and Spatial Planning at the Ce3C – Centre for
71–82. Ecology, Evolution and Environmental Changes (De-
Simatupang, T.M., Sridharan, R., 2002. The collaborative supply chain. Int. J. Logist. partment of Biology, University of the Azores, Portugal),
Manag. 13 (1), 15–30. with the reference SFRH/BPD/100017/2014 from the
Solomon, M.R., Dahl, D.W., White, K., Zaichkowsky, J.L., Polegato, R., 2014. Con- "Fundação para a Ciência e Tecnologia" (FCT), funded by
sumer Behavior: Buying, Having, and Being. Prentice Hall, NJ. the National Budget of the Ministry of Education an-
Srivastava, S.K., 2007. Green supply-chain management: a state-of‐the-art literature dScience of Portugal and by the European Social Fund.
review. Int. J. Manag. Rev. 9 (1), 53–80. His current research is focused on the processing,
Steg, L., Dreijerink, L., Abrahamse, W., 2005. Factors influencing the acceptability of analysis and modeling of spatial data for decision
energy policies: a test of VBN theory. J. Environ. Psychol. 25 (4), 415–425. support on Land Management and Environmental

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
j.envres.2016.05.006i
12 J. Couto et al. / Environmental Research ∎ (∎∎∎∎) ∎∎∎–∎∎∎

Planning in very sensitive territories as small islands. He has published several Sandra Dias Faria is an Assistant Professor at University
articles in internationals journals such as Journal of Coastal Research, Journal of of the Azores, Ph.D. in Management (Entrepreneur-
Transport Geography, European Journal of Remote Sensing and Environmental ship), has a MsC in Public Management and a degree in
Science & Policy, among others. Business. She teaches Entrepreneurship, Human Re-
sources and Innovation to masters and undergraduate
courses. She is a Research Fellow at the Advance/CSG,
ISEG - Lisbon University and at the Centre of Applied
Economics Studies of the Atlantic – Azores (Portugal).
Flá1;vio Gomes Borges Tiago is an Assistant Professor at
Her main research interests include Entrepreneurship,
University of the Azores and Chairman of the Board of
Human Resources, Tourism, Healthcare Management
NONAGON – Science and technology Park of S. Miguel –
and Innovation. She has published several articles in
Azores., Ph.D. in Internet Marketing and E-business and,
international conferences and journals such as Business
has the MsC and MBA by the University of the Azores. He
Horizons and Tourism Management, among others.
teaches marketing courses and is a Research Fellow at the
Advance/CSG, ISEG - Lisbon University and at the Centre of
Applied Economics Studies of the Atlantic – Azores (Por-
tugal). Her main research interests include Knowledge
Management, Healthcare management, Digital Marketing,
Social Media, Entrepreneurship and Tourism. He has
published several articles in regional, national and inter-
nationals journals, such as Tourism Management, Business
Horizons, The Business Review, International Journal on Strategic Innovative Marketing
and Management Research News, among others.

Please cite this article as: Couto, J., et al., It’s hard to be green: Reverse green value chain. Environ. Res. (2016), http://dx.doi.org/10.1016/
j.envres.2016.05.006i

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