Factors Affecting the Usage Intention of Environmental Sustainability Management Tools: Empirical Analysis of Adoption of Greenhouse Gas Protocol Tools by Firms in Two Countries

Abstract

Mitigating the greenhouse gas (GHG) emission problem is one efficient way to respond to climate change challenges. Firms must proactively manage GHG emissions, with increasing pressure from various stakeholders to be environmentally responsible. GHG Protocol Tools help in managing GHG emissions. However, besides responsibility, the factors that influence the adoption and implementation of GHG Protocol Tools is sparsely investigated in empirical research, although studies point to different benefits and pressures influencing adoption. This study examines the factors affecting GHG Protocol Tool usage in organizations in China and South Korea. We consider two contrasting perspectives, affordance-based perceived benefits and constraint-based perceived pressures through imitating others, for GHG Protocol Tool adoption. Survey data from samples of firms from both countries are used for analysis. Results of empirical analyses indicate that perceived benefits and pressures have a positive relationship with the usage intention of GHG Protocol Tools. In comparison, the perceived benefits play a more critical role than the perceived pressures. Comparative analysis is conducted to explore the differences between Chinese and Korean firms, and study implications are discussed.

1. Introduction

The emerging scientific evidence overwhelmingly supports the notion that the deterioration of the natural environment is a critical challenge to society, with consequential effects on global warming, air pollution, and energy depletion. Carbon dioxide (CO₂) and anthropogenic greenhouse gases (GHG) are substances emitted by humans, causing climate change, produced by burning organic material, such as fossil fuels and forests [1].

GHG Protocol Tools are an environmental management system (EMS) that focuses on a business’s environmental risks and impacts. Many companies have decided to adopt some form of EMS, including GHG Protocol Tools, to address concerns about environmental sustainability [2]. This trend has significantly aroused attention towards ecological preservation by enterprises as voluntary actions to showcase their corporate social responsibility [3]. A GHG Protocol is a firm’s most widely used tool to understand, quantify, and manage GHG emissions. It consists of standards, guidance, tools, and calculations for preparing GHG emission inventories [4]. In 2016, 92% of Fortune 500 companies responding to the Carbon Disclosure Program (an international non-profit for monitoring carbon emissions) used a GHG Protocol directly or indirectly through a program based on GHG Protocol (see https://ghgprotocol.org/about-us for details, accessed on 10 January 2023).

GHG Protocol Tools follow GHG standards that provide the transparency and assurances needed for product labeling, purchasing carbon offsets, regulating business emissions, and certifying GHG practitioners that help to deliver services and manage companies and public programs [5]. Then, the GHG emissions are compared against widely accepted standards and benchmarks. Undoubtedly, the consumer-led demand for environmentally friendly products and services pushes more suppliers to provide company statements on emission inventories [6]. Thus, the GHG Protocol Tools are expected to add value to organizations, countries, and the public. This is achieved by creating an initial GHG emissions database, managing business risks, and identifying GHG emission reduction opportunities [7]. Firms can facilitate public data disclosure through national and global reporting initiatives, prepare for mandatory reporting and future emission control requirements, and participate in carbon markets, as applicable [8]. Overall, GHG Protocol Tools help firms to maintain climate change management as a critical focus in their industrial activities and support sustainability as an essential criterion in the firms’ management decisions.

Irrespective of the benefits of the GHG Protocol Tools, voluntary adoption across all industry sectors is not yet one hundred percent. The barriers to adoption remain challenges such as unwillingness to follow protocols, a lack of appropriate environmentally responsible behavior and strategies, and cost concerns at firm level [9]. Countries do not have any mandated regulations to force adoption, with the exception of a few. Thus, investigating the factors influencing GHG Protocol Tool adoption is timely and insightful for research and practice.

This study develops a conceptual model and hypotheses to empirically examine the factors influencing GHG Protocol Tools’ usage intention. Our specific aim is to identify the relationship between affordance, constraint factors, and the usage intention of GHG Protocol Tools. The proposed model in this study is based on three research questions concerned with the relationship between perceived benefits, perceived pressures, imitating others, and usage intention of GHG Protocol Tools. The first research question determines whether both the perceived usefulness and perceived disadvantages of GHG Protocol Tool usage can affect their usage intention in a contrasting mechanism. The second research question contemplates the dimensions of perceived benefits and perceived pressures for GHG Protocol Tool usage. The third research question is intended to determine the role of imitating others. Thus, this study explores the mediating effect of one type of herd behavior, following prior research that suggested that herd behavior might mediate the relationship between constraint factors and the usage intention of information technology [10].

To test the abovementioned hypotheses, we used the survey data from firms using GHG Protocol Tools in China and South Korea—two countries with high GHG emission levels. Both countries use the same GHG Protocol and have cooperated to mitigate climate change. However, how much country-level intentions are reflected at the firms at the ground level remains a question. Considering country-level regulations and environmental responsibilities in firms, this research seeks to review the GHG Protocol Tool adoption challenges, comparatively in both countries’ contexts, and provide research and managerial insights.

2. Theoretical Development and Hypotheses

2.1. Literature Review

The environmentally responsible behavior of firms has been explored from multiple perspectives in existing research. Prior studies have provided several frameworks or models, suggested several effective mechanisms, and provided contextually situated solutions to mitigate emission-relevant concerns. We briefly review important themes next.

In terms of frameworks or models, the relationship among environmental regulations, environmental strategies, and the corporate performance of environmentally responsible systems is explored sparsely. For example, a prior study has assessed the economic aspect and environmental performance associated with environmental regulations and strategies and explored the driving factors of the producer-extended responsibility system, which includes government regulations and incentives, consumer demand pressure, and the internal environment of the enterprise management [11]. Based on the perspective of government regulation theory, another study [12] built a theoretical model to demonstrate the role of environmental regulation (intellectual property protection and social responsibility supervision) in improving the innovation performance of small and medium-sized enterprises (SMEs).

The existing literature has noted some effective mechanisms for firm-level responsible behavior. Research has examined the impact of environmental regulation (pollution charge) on green technology innovation and the mediating role of corporate environmental responsibility [13]. A prior study explored the influencing mechanism of environmental regulation on corporate green innovation and the moderating mechanism of CSR disclosure by constructing a nonlinear fixed-effect regression model [14]. Research has also proposed to pay attention to the promotion of environmental regulation, encourage enterprises to carry out green innovation activities actively, continue to deepen the market-oriented reform of energy prices, increase credit support, and introduce financial resources for corporate R&D activities to explore policies to improve the efficiency of regional green innovation [15]. A recent study explored the ideal collaborative governance framework in the process of collaborative environmental governance, as well as the difficulties and optimization paths of collaboration, and put forward corresponding suggestions for the current environmental governance [16].

Contextual investigations around firm-level environmental sustainability adherence have given nuanced insights. Based on manually collected data from China’s A-share listed companies from 2010 to 2017, an existing study [17] investigated the effect of corporate political connections (PCs) on corporate environmental protection-related investment (EPI). The impact of public environmental concern on corporate green investments from the perspective of CEO turnover, using the extreme event of the PM 2.5 surge at the end of 2011 in China as a quasi-natural experiment, was the topic of investigation in a prior study [18]. Another study used a novel and comprehensive dataset to investigate the influence of corporate environmental responsibility on the default risk of listed firms in China [19]. Taking China’s A-share listed companies from 2014 to 2018 as the research sample, a recent study analyzed the mediating effect of enterprise peer influence in carbon disclosure [20]. Based on the data of Chinese A-share listed firms in heavily polluting industries, another study explored the influence of green finance on corporate environmental responsibility (CER) performance [21]. Furthermore, research has also explored the effectiveness of specific orders, such as a study reviewing the implementation effectiveness of the “Plastic Prohibition/Restriction Order” since 2007 in China [22].

Thus, the extant research motivates and posits a gap to identify factors associated with firm-level responsible behavior in different country settings. Identifying the factors influencing specific tools’ and applications’ implementation to mitigate environmental concerns will help governments and industry sectors to follow some aspirational measures. Following the dual model [23], this study examines the perceived benefits as affordance factors and perceived pressures as constraint factors. This paper also aims to identify the logic behind the seemingly contrasting dual model by studying the mediating role of herd behavior. In addition, this research tries to address this gap in the context of firms in China and South Korea, considering the country-level regulations and environmental responsibilities of firms. In the following sections, we examine the key constructs, develop the hypotheses, and review the relevant regulations.

2.2. Affordance Factors: Perceived Benefits

The affordance-based perceived benefits associated with a system’s adoption are direct accrued benefits for a firm. The motivations for GHG Protocol Tool adoption should follow similar ones ascribed to environmental or green information or management systems’ adoption in prior research. These include reduced pollution, energy, and material consumption; the avoidance of environmental risks, accidents, and hazards [3,24]; the plausible improvement of environmental performance [25,26]; and overall ecological commitments, responsibilities, and credibility [27]. With environmental considerations, companies intend to do the right thing for the environment [28] and thus should aspire to achieve ecological benefits [29]. Other benefits of adopting such systems include cost reductions [9,30], efficiency and waste improvements [24,26], and reductions in fines and legal fees [31]. Such systems also help in obtaining managerial benefits, such as detecting and minimizing environmental and liability risks and enhancing the process and product environmental innovation [7]. The benefits also include assisting management in dealing with environmental issues, reducing disputes with the public on ecological pollution [7], establishing eco-effectiveness, and, more specifically [31], reducing the GHG emissions [1]. Along with this, prior research has also substantiated the direct benefits of such systems, such as an increase in profits [9] and business benefits or performance [3,32].

Organizations initiate environmental or green initiatives and start thinking responsibly because they face policy or societal pressures or wish to improve their corporate reputation [24]. In both cases, organizations care about their benefits. It is the desire to implement practices and technologies to improve environmental sustainability out of deep concern for the natural environment [33]. A recent study has empirically shown that environmental and economic performance are positively linked, even though firms perceive sustainability as a liability [9]. The perceived ecological benefits can motivate environmental strategies in the numerous factors influencing an organization’s environmental strategy [34]. The idea that businesses and organizations generally have more than mere financial responsibilities is not new [35]. Some researchers have even reported that the overarching incentive for business is what makes good business sense to pursue strategies for a sustainable world [25].

For the GHG Protocol Tools, the environmental benefits are GHG mitigation benefits of integrated air pollution and greenhouse gas reduction strategies and measures for the energy sector. At the same time, energy consumption will be reduced in the GHG mitigation process due to the highly positive relationship between GHG mitigation and energy saving. Environmental benefits of GHG Protocol Tools include preventing pollution, minimizing the ecological footprint, and developing environmentally friendly competencies [1].

Financial benefits are extrinsic and gained whenever an activity is done to attain different outcomes [36]. It is one of the most effective ways to motivate organizations, especially business organizations, to engage in environmentally friendly practices. It is easy to understand that if a business organization conducts some environmental sustainability strategies, the penalties from the government and senior organizations will be reduced. Thus, the company will have the motivation to adopt GHG Protocol Tools because of the penalty reduction, which is one financial benefit that GHG Protocol Tools can provide. Previous studies also identified saving time as one financial benefit of green information systems [37]. In the context of GHG Protocol Tool usage, we can expect timesaving to be one financial benefit. For example, by using GHG Protocol Tools, organizations can estimate the future situation through the scenario, grasp the current situation through emission analysis, and save time in their benchmarking pursuits [38]. Thus, financial benefits become the driving force for organizations to have the intention to use GHG Protocol Tools.

GHG Protocol enables a standard that is quickly followed in the management process. From this perspective, the perceived managerial benefits of GHG Protocol are management capability improvements, improved documentation, and increased organizational efficiency [27,31,39,40]. Furthermore, GHG Protocol Tools are used explicitly in environmental management. From this perspective, GHG Protocol Tools may provide managerial benefits such as detecting and minimizing ecological and liability risks and enhancing process and product environmental innovation. In previous research, all these benefits led to the usage intention of the system or technology. Thus, we argue that a positive relationship exists between the perceived benefits and intention to use GHG Protocol Tools.

Hypothesis 1.

Perceived benefits will be positively associated with the intention to use GHG Protocol Tools.

2.3. Constraint Factors: Perceived Pressures

From the dual model perspective, not only the affordance-based perceived benefits can positively influence the usage intention of GHG Protocol Tools, but also constraint-based perceived pressures can positively affect the usage intention of GHG Protocol Tools [24]. To measure and analyze the effects of constraint-based perceived pressures, this study identifies three critical second-order constructs of perceived pressures from the previous literature. The three second-order constructs are societal pressure, organizational pressure, and regulatory pressure.

Prior research also suggests that factors such as civic responsibility [25], the social contract [41], social responsibility [42], social norms [43], social acceptance, and public image [28] have impacts on environmental or green information or management system adoption. Therefore, this study proposes that one of the constraint-based pressures is societal pressure. For example, corporate image is improved by social responsibility, societal drivers [27], compatibility with existing beliefs and values, self-image, and brand loyalty. Similarly, goodwill from the customer and community, improved relations with the community and other stakeholders [31,44], and enhanced reputation [24] are significant reasons for which businesses adopt environmental or green information or management systems in prior research.

As a critical part of the institutional pressure based on institutional theory, organizational pressure is also proposed as one constraint-based pressure in this research. Previous researchers had different focuses on this term. Some emphasized strong leadership [34], and some defined it as the pressure exerted by another organization [37]. On the other hand, in the EMS adoption process, searching for competitive advantages, matching competitors’ actions [3], and environmental-related trade barriers [24] are appropriate influencers. Along the same line, benchmarking with other organizations [44] has already been discussed as a significant influencer in existing research.

For business organizations, the company’s leadership team exerts pressure on the whole body of the company; external pressure may come from other business organizations. Thus, the organizational pressure can be vertical and horizontal. In most situations, researchers believe that governments place regulatory pressure on businesses because of the governance nature of government organizations [25] and the various regulations and legitimations implemented by governments [45,46].

Prior research identified the effects of sociocultural influences on adopting information systems, which reflect the environmental values, beliefs, and trends in society [47]. This influence is highly related to the impacts of media and organizations’ needs for social legitimacy [34]. In responding to the increased social, cultural, and legislative pressures that expand the responsibility of firms to increase their attention to environmental concerns [48], chief executives have increasingly committed to environmental or green information or management systems for sustainability transformation efforts [25]. In some countries, this rate is reported to be as high as 60 percent [49]. Another situation in which society may exert pressure on an organization is social responsibility. Among the forces driving changes, social responsibility requirements are becoming more urgent due to the rapid depletion of natural resources and the increasing concerns over corporate social responsibility [35]. Sustainability has increasingly become critical to business research and practice over the past few decades due to the rapid depletion of natural resources and concerns over wealth disparity and corporate social responsibility. Researchers have acknowledged that a socially responsible company must do more than make a profit [35]. Previous authors have suggested that institutional theory is an appropriate vehicle when investigating how institutional forces lead a firm to be responsive to the needs of others in society. Business organizations are becoming accountable for their environmental and social responsibilities and financial obligations of maximizing profits [50]. The trend toward corporate social and environmental responsibility is noted in prior studies [51,52]. In practice, it is now expected that many business enterprises describe policies or measures aimed at environmental sustainability as part of their annual statements on CSR or in special corporate sustainability reports [47]. For businesses, environmental sustainability is integral to the movement toward corporate social responsibility [42].

Organizational pressure belongs to the coercive pressure category, one type of institutional pressure. It is exerted by organizations such as governmental agencies or more powerful business partners, on which the decision-maker either depends or competes [37]. Research has acknowledged that addressing sustainability issues is critical to companies’ long-term existence and thriving [35]. There can be many choices for organizations to set up environmental strategies. Nevertheless, one of the best choices will be green information systems. Recent research has shown that competition in the business market has heightened since the mid-1990s, along with the investments and application of information systems in general [53]. Therefore, most companies will choose green information systems to face organizational pressures. Adopting the previous literature, the definition of regulatory pressure in this study is the pressure that businesses and institutions must exert to comply with the regulations [54]. Inside business organizations, they have their indicators for environmental protection performance [34]. As the bridge between external and internal rules, senior managers’ attitudes toward adopting green information systems may change due to pressure from regulatory bodies and influence the regulation inside business organizations [33].

Coercive pressure derived from regulatory bodies will occur mainly in the most regulated fields. Hence, environmental issues are considered negative externalities, forcing senior managers to improve the firm’s environmental performance. Prior work [55] argued that coercive pressures similarly affect all companies, leading to the regulation of adaptive processes. Therefore, we expect that managers of companies affected by coercive pressure will develop a positive attitude to the adoption of green information systems, resulting in both environmental and commercial benefits. The regulation was suggested as one reason for the environmental practice initiative because the firms wish to avoid sanctions and punishments in the form of penalties, fines, or withdrawal of licenses due to non-compliance with environmental regulations [56]. Previous researchers found that regulatory pressures are often associated with an organization’s decision to adopt environmental practices, and these pressures arise from threats of non-compliance penalties and fines [27]. Increased demand has been placed on the manufacturing industries to be more responsive to their environment concerning their product and processes. This demand is due to various antecedent factors driving sustainable environmental practices in manufacturing firms. However, ecological value is not only a concern of firms. The impacts of this environmental initiative on these firms’ performance are also substantial [56]. Thus, we posit a hypothesis related to the relationship between perceived pressures and usage intention of GHG Protocol Tools as follows:

Hypothesis 2.

Perceived pressures will be positively associated with the intention to use GHG Protocol Tools.

2.4. Herd Behavior: Imitating Others

Prior research suggested that these two mechanisms might influence the usage intention of environmental or green systems in different ways but reach the same result [23]. Researchers also agreed that what needs to be done and how best to proceed are the most troubling problems for businesses under the requirement of an urgent response with many unknowns [25]. Herd behavior can mediate uncertainty’s impact on information systems’ usage intention [10]. Therefore, this research proposes the mediating effects of herd behavior in the relationship between constraint-based perceived pressures and usage intention of GHG Protocol Tools. Following a previous study [10], we use the concept of imitating others to describe the herd behavior of technology adoption in this study.

Two possible contrasting mechanisms may occur in the adoption process of environmental or green systems. First, affordance-based benefits are direct enablers of adoption, so there can be a direct relationship between these factors and the usage intention. Previous literature on herd behavior indicates that this relationship is indirect for the other mechanism that presents the relationship between constraint-based pressures and usage intention [10]. This study believes that this is the reason that two contrasting mechanisms can work in different ways but achieve the same result.

Herd behavior refers to the phenomenon that people behave in the same way as others, mainly as a group [57]. We all have witnessed and participated in numerous situations where decision-making was strongly influenced by what others around us were doing, which is the effect of herd behavior. Herd behavior has been observed in a variety of situations, such as in choosing retirement investments [58], opening new bank branches [59], developing prime-time television programs [60], and downloading software applications [61,62]. Prior work [63] defines herd behavior in terms of three related aspects: (1) the actions and assessments of investors who make decisions early will be critical to the decisions of the majority; (2) investors may herd or organize their adoption behavior based on the wrong information, which may lead to the wrong decision; and (3) if they make the wrong decision, then experience or new information may cause them to reverse their decisions, and a herd may be created in the opposite direction. We adopt a more general view of herd behavior and consider it a manifestation of behavior conformity that may or may not require learning and information transmission among decision-makers.

Prior research has discussed two types of herding: reputation-based and compensation-based herding [10]. Firstly, reputation-based herding is related to imitating others to avoid being considered incapable. Prior research stated that imitating others can enhance one’s intention to use technology. Secondly, the literature on compensation-based herding suggests that imitation is a driving force to avoid the competitive disadvantages of rejecting a specific technology. Notably, imitating others has a mediating effect on influencing uncertainty’s impact on the usage intention of the technology [10].

The role of herd behavior in technology adoption has been discussed earlier in studies [64] involving reputational herding, compensation-based herding, and information cascade-induced herding [10]. Thus, imitating others is incorporated into the research model, aiming to explore how imitating others mediates the impact of perceived pressures on the usage intention of GHG Protocol Tools in this research. Observing others’ actions and uncertainty regarding the decision to be made are the two conditions for herd behavior, and they positively impact the imitation of others. Previous literature has documented the relationship between different types of pressure and imitating others—for example, societal pressure [65], organizational pressure [37], and regulatory pressure [66].

People care about how using a specific technology will affect their image in their social systems [10]. People attempt to avoid costs or blame for impropriate choices by imitating others. Therefore, this system would be the best choice if most other organizations used GHG Protocol Tools. Considering organizations’ pursuit of social acceptance and a good social image, imitating others will be a possible result under the societal pressure of organizations. To fully understand organizations’ imitations, we must look beyond their goals in the imitative situation and consider others’ goals toward them. Organizations must do things in the culturally prescribed manner that society often pressures them to imitate in a particular way [67].

Under organizational pressure, organizations may pay attention to the number and identity of technology adoption predecessors [10]. When numerous competitors and peers have adopted a system, non-adopters fear being perceived as less innovative or adaptable to external conditions [40]. They will imitate the specific approach adopted by many organizations and organizations with good performance. On the other hand, people may follow a particular group of adopters defined as “power users” because of their unique leading identity [68]. To avoid the embarrassment of being isolated and to follow the big names, non-adopters become adopters. With the advances of Internet technology and mobility improvements, it is straightforward for people to access predecessors’ decisions. Thus, these potential users are more prone to imitating others’ decisions. Organizations receive regulatory pressures, and they are urged to conduct some environmental practices, but there is no legislation mandating the use of a particular system. Therefore, if many organizations use GHG Protocol Tools, non-adopter organizations will imitate the adopters. Their choice will lead to the herd behavior of other organizations. If most of them are using GHG Protocol Tools, the non-adopter organizations will imitate them and intend to use GHG Protocol Tools [10]. From observing others’ behavior and uncertainty about adopting Green IS, the companies may perceive pressure and imitate others. The more observed organizations are using or have a plan to use GHG Protocol and the more critical the observed organizations, the greater the possibility of the behavior to imitate others. When the uncertainty is high, a potential adopter can analyze and understand the real reason for the adoption and cannot accurately assess the potential utility of a particular system. Based on the points mentioned above, this study expects a positive relationship between perceived pressures and the behavior of imitating others.

Hypothesis 3.

Perceived pressures will be positively associated with imitating others.

There are three types of herd behavior: compensation-based, reputation-based, and information-based [10,64]. This study believes that as one type of herd behavior, imitating others is even more critical for the usage intention of GHG Protocol Tools, not only for the competitive advantages, reputation, and social learning process. Managers imitate others’ decisions and are intentionally concerned about their careers in adoption herding to build their professional reputations and increase their human capital returns. Implicit incentives of career-concerned managers and informational asymmetries in systems adoption drive reputational herding. The financial returns of most systems or technological investments are hard to measure, especially in the short run. Thus, contractual incentive provisions become much more complex, strengthening incentives for managers to engage in reputational herding [64]. Prior work [69] also discussed the role of this reputational herding in the decision-making process in the audit area. Therefore, imitating prior adopters of GHG Protocol significantly and directly influences one company’s intention to use GHG Protocol Tools. In this research, it is proposed as a positive relationship between imitating others and the intention to use GHG Protocol Tools.

Hypothesis 4.

Imitating others will be positively associated with the intention to use GHG Protocol Tools.

Based on the arguments and hypotheses presented, we developed a conceptual framework, shown in Figure 1, and tested it using Structural Equation Modeling.

2.5. Country-Level Regulations and Environmental Responsibility of Firms

If GHG emissions at the sources can be measured and monitored, this will help to curb the emissions, which has become imperative for both the public and private sectors [4]. Firms’ stakeholders are emerging and becoming responsible towards the environment, although these responsibilities vary broadly across countries. The environmental issue concerns many stakeholders who assess, monitor, and demand that corporations take action [70]. Environmentally conscious groups have an increasing say in government regulations on greenhouse gas emissions from industries [71]. Therefore, it is a corporate responsibility for all firms to manage GHG emissions-related disclosures. Firms need to develop proactive strategies for environmental issues and disclose GHG emission information to maintain their corporate reputation and manage government regulations in response to the demands of stakeholders.

Country-level regulations affect firms’ environmentally responsible behaviors. Many developing and developed nations adhere to international norms and stipulations for environmental responsibility, while others struggle with several mandatory norms. We briefly discuss South Korea and China’s country-level regulations that influence firm samples’ environmental responsibility in this study.

To exemplify the national challenges that countries are facing, South Korea experienced rapid economic growth and a doubling of its GHG emissions from 1990 to 2005, the fastest increase in emissions among OECD nations. In 2008, the GHG emission ranking of South Korea was 10th in the world, while the emissions per capita in South Korea were higher than in China (10.9 tons and 6 tons of CO₂ emissions per person, respectively) [72]. In South Korea, corporate environmental responsibility is regulated by the Ministry of Environment through the Environmental Management Act and its accompanying regulations. These laws and regulations cover a wide range of activities, including managing air and water pollution, waste disposal, and the conservation of natural resources. Companies must obtain environmental permits for specific activities and are subject to inspections and penalties for non-compliance. Additionally, South Korea has implemented several voluntary programs, such as the Eco-Management and Audit Scheme (EMAS), to encourage companies to improve their environmental performance.

Examples of GHG emission regulations in South Korea are as follows. (1) The Greenhouse Gas Emission Trading Scheme (K-ETS): This is South Korea’s cap-and-trade system for reducing greenhouse gas emissions. It covers the power industry and buildings sectors and obliges companies to surrender allowances for each ton of CO₂ that they emit. The allowances can be bought and sold in the market, and the system’s caps decrease over time. (2) The Renewable Portfolio Standard (RPS): This regulation requires electricity retailers to source a certain percentage of their power from renewable energy sources, to increase the share of renewable energy in South Korea’s power mix. (3) The Energy Conservation Act: This law aims to promote energy efficiency and conservation in South Korea and sets energy efficiency standards for various products and equipment. It also provides financial incentives and subsidies for energy-efficient technologies and practices.

In China, corporate environmental responsibility is regulated by the Ministry of Ecology and Environment (MEE) and its local branches. The primary laws and regulations that govern corporate environmental responsibility in China include the following. The Environmental Protection Law: This law sets out the general principles for environmental protection and establishes the legal framework for environmental regulation in China. It requires companies to take measures to prevent and control pollution and to bear responsibility for environmental damage caused by their activities. The Air Pollution Control Law: This law regulates the prevention and control of air pollution and requires companies to reduce their emissions of pollutants. Some other examples include the Water Pollution Control Law, the Solid Waste Pollution Control Law, and the Law on the Prevention and Control of Environmental Noise. In addition to these laws, China has implemented several policies and programs to encourage companies to improve their environmental performance, such as the “Green Credit Policy” and “Circular Economy Promotion Law”.

Examples of GHG emissions regulations in China are as follows. (1) The National Emissions Trading System (ETS): China’s national carbon market covers power generation, iron and steel, cement, and chemical industries. The ETS sets a cap on the total amount of CO₂ emitted and allows companies to buy and sell emissions allowances to meet their reduction targets. (2) The Renewable Energy Law: This law sets targets for the proportion of renewable energy in the country’s energy mix and provides financial incentives for developing and using renewable energy sources. (3) The Energy Conservation Law: This law promotes energy efficiency and conservation in China and sets energy efficiency standards for various products and equipment. It also requires companies to disclose their energy consumption and provides financial incentives for energy-efficient technologies and practices. China is committed to curbing CO₂ emissions before 2030 and plans to achieve carbon neutrality before 2060 under the Paris Agreement. The country has also set up a national carbon market and implemented several policies and regulations to promote low-carbon development and reduce greenhouse gas emissions.

However, it remains challenging for South Korean and Chinese firms to respond to the country-level higher echelons of mandates and regulations. Can they change their behavior easily when it comes to environmental responsibilities? If so, what underlying factors can help them to adhere to the responsibility norms? This study conducts a comparative analysis to examine the differences in factors that influence the adoption and implementation of GHG Protocol Tools—a critical aspect of curbing emissions and being environmentally responsible in firms located in these two countries.

3. Methodology

Question items from extant studies were adequately adapted to the GHG Protocol Tool usage context. An attempt was made to derive question items from existing works to ensure the validity and reliability of the study. However, the authors had to develop items and modify existing items for some measurements because we could not find appropriate question items from existing works sometimes. The constructs and their measurement items are shown in Appendix A.

Before distributing the questionnaire to the general respondents, this study conducted pre-testing. According to [73], pre-testing a questionnaire is very important to ensure that respondents understand the questions posed and that there is no ambiguity in the questions or problems with the wording or measurements. Specifically, the pre-testing aimed to evaluate continuity and flow, question skips, and timing. Continuity and flow mean that transitions from one section to the next should be smooth and not awkward with regard to a respondent’s thought patterns—for example, grouping questions on a similar topic together. Question skips refer to filtering inquiries with Yes/No options that should guide respondents unambiguously to the next desired question without undue skipping of questions. Timing means estimating the time needed so that (1) lengthy questionnaires can be redesigned if necessary; (2) the respondents can be appropriately informed and mentally prepared for the time required to complete the questionnaire.

Firstly, almost 90% of the items on the questionnaire were adapted from prior research published in the English language, although the study context was China and South Korea. Then, the English questionnaire was translated into Korean and Chinese versions. Two Korean experts, one working at the Seoul Metropolitan Government Research Institute of Public Health and Environment and the other a Korean teacher, refined the Korean version of the questionnaire. Two Chinese experts, one working at the Department of Climate Change of NDRC in China and the other a Chinese teacher, refined the Chinese version of the questionnaire. At the same time, the authors uploaded the English version questionnaire to one questionnaire-designing online course forum to receive feedback from professors and peers. The questionnaire was modified several times by combining the opinions from different perspectives. For example, the previous questionnaire examined business and government organizations’ attitudes. However, the updated questionnaire only has one focus, which is a business organization. Possible misinterpretations, the adequacy of options provided to the respondents, and various minor points were revised.

Next, the revised questionnaire was distributed to 3 Korean companies and two Chinese companies that provide eco-label products to evaluate the questionnaire. More specifically, was the questionnaire easy to complete overall? Was the intended meaning of any words or questions clear? Was any term ambiguous? Were the response categories mutually exclusive where appropriate? Did the content of the questions seem relevant to the purpose of the study? What was the length of the survey? Then, the questionnaire was modified based on suitable suggestions and comments and sent to Clean Asia for final review. After minor wording and formatting modifications, the final questionnaire instrument was sent to the target organizations.

We wished to explore the intentions for GHS Protocol adoption, which only some firms have adopted. Thus, random sampling could have limited our results or led to a higher non-response rate. Instead, we followed a purposive non-random sampling strategy following past research, industry practices, and imitations of given resources. We targeted 1224 Chinese companies and 1864 Korean companies that provide eco-label products, primarily because of the potential relationship between eco-label product certification and the awareness of environmental issues. The Clean Asia Institution contributed to the questionnaire distribution and data collection process. Finally, we obtained 370 usable responses (response rate: 19.85%) from Korea and 390 usable responses (response rate: 31.86%) from China for the data analysis.

Table 1. Demographics of respondents (n = 760).

Category	Options	Frequency	%
GHG Protocol Tools Usage	Yes	106	13.95%
	No	654	86.05%
Region	1	359	47.24%
	2	99	13.03%
	3	106	13.95%
	4	173	22.76%
	5	20	2.63%
	6	3	0.39%
Size (Num. of Employees)	More than 200	266	35.00%
	Less than 200	494	65.00%
Position (of Respondent)	Employee	308	40.53%
	Environmental Manager	149	19.61%
	Department Manager	78	10.26%
	Managing Director	173	22.76%
	Head of Organization	52	6.84%

shows the demographic data of the survey’s respondents.

4. Results

4.1. Descriptive Analysis Results

Descriptive statistics of the studied variables on the 7-point Likert scale are summarized in

Table 2. Descriptive statistics.

Construct	Second-Order Construct	Mean	Standard Deviation
Perceived Benefits	Environment Benefit (EB)	4.24	1.27
	Financial Benefit (FB)	4.66	1.08
	Managerial Benefit (MB)	5.08	1.07
Perceived Pressures	Societal Pressure (SP)	4.83	1.06
	Organizational Pressure (OP)	4.71	1.08
	Regulatory Pressure (RP)	5.01	1.05
Imitating Others (IM)	NA	4.21	1.23
Usage Intention (UI)	NA	4.79	1.12

. The mean values of the variables were between 4.21 and 5.08. The standard deviations were between 1.05 and 1.27. The results indicate that respondents had a low level of perceived imitation of others (4.21/7) and perceived environmental benefits (4.24/7). The respondent’s perceived managerial benefit was relatively high (5.08/7).

4.2. Measurement Model Analysis

4.2.1. Reflective Measurement Model

In the first-order model, the variables are reflective. Thus, a reflective measurement model analysis method was adopted.

Table 3. Convergent and discriminant validity analysis results.

Variable	AVE	CR *	CA *	EB	FB	MB	OP	RP	SP	IM	UI
EB	0.697	0.902	0.855	0.835
FB	0.603	0.859	0.78	0.491	0.776
MB	0.689	0.898	0.849	0.363	0.357	0.83
OP	0.616	0.865	0.79	0.361	0.518	0.473	0.785
RP	0.684	0.897	0.846	0.305	0.45	0.539	0.609	0.827
SP	0.647	0.88	0.818	0.265	0.427	0.591	0.569	0.511	0.804
IM	0.731	0.891	0.817	0.337	0.437	0.294	0.476	0.449	0.369	0.855
UI	0.729	0.89	0.814	0.438	0.456	0.452	0.473	0.469	0.447	0.56	0.854

* CR = Composite Reliability, CA = Cronbach’s Alpha, the table are the bold values in the table are the squared AVE values.

shows the AVE value, an indicator of convergent validity. All the values are above 0.5; all the composite reliability values are greater than 0.6; all the Cronbach’s alpha values that indicate the internal consistency are greater than 0.7. Therefore, the convergent validity, composite reliability, and internal consistency are verified. Table 3 also shows the Fornell–Larcker criterion, which requires that the AVE of each variable should be greater than the squared correlations with all other variables (the bold values in the table are the squared AVE values). Thus, the discriminant validity is safely guaranteed.

4.2.2. Formative Measurement Model

This study aimed to explore perceived benefits, perceived pressures, and GHG Protocol Tool usage intention. An underlying methodological objective was to determine the weight of each second-order construct of perceived benefits and second-order construct of perceived pressures factor. Therefore, this study conducted second-order formative measurement model analysis [74]. Firstly, VIF values that indicated the collinearity of perceived benefits and perceived pressures were identified, which were 1.682 and 1.884, respectively. Both values were smaller than 10 and even smaller than 2. Secondly, the weight of each second-order construct and the t-values and p-values were obtained via SmartPLS analysis, as shown in

Table 4. Weight of each second-order construct. (*** indicates p < 0.001).

	Benefit (B)	Pressure (P)		t-Statistic	p-Value
EB	0.435		EB → B	5.479	***
FB	0.357		FB → B	4.134	***
MB	0.464		MB → B	6.076	***
OP		0.464	OP → P	6.346	***
RP		0.432	RP → P	6.173	***
SP		0.284	SP → P	3.227	***

.

4.3. Structural Model Analysis

There are three indicators used in PLS to evaluate the model fit: the coefficient of determination (R²), Stone–Geisser’s Q2 (Redundancy), and the goodness-of-fit index (GoF) value. Both R square values for IM (0.27) and UI (0.46) are at a moderate level, and both their redundancy values are positive (IM: 0.20, UI: 0.33). The GoF value (0.376) is also at a high level. They all indicate a verified model fit.

Table 5. Hypothesis testing results. (*** indicates p < 0.001).

Hypothesis	Path	Coefficient Size	t-Value	Result
H1	Benefit → Usage Intention	0.303	8.372 ***	Supported
H2	Pressure → Usage Intention	0.185	4.280 ***	Supported
H3	Pressure → Imitation	0.517	16.514 ***	Supported
H4	Imitation → Usage Intention	0.464	8.473 ***	Supported

reports the hypothesis testing results.

This study’s last hypothesis is to examine the mediating effect of imitating others. We use the Sobel test to examine the mediating effects.

Table 6. Mediating effects evaluation results. (*** indicates p < 0.001).

	Coefficient Size	Standard Error	t-Statistic	p-Value
IM → UI	0.377	0.039	9.616	***
Pressure → IM	0.513	0.031	16.588	***
Pressure → UI	0.357	0.04	8.942	***

shows the values that should be considered in the mediating effect analysis process. Before, without the mediator variable, the path loading between perceived pressure and usage intention was 0.551. After adding the mediator variable, the path loading decreased to 0.357, but was still significant (t-value = 8.942).

4.4. Comparison Study Analysis: China vs. South Korea

This research compares the differences between Chinese and South Korean firms in second-order formative measurement model analysis, structural model analysis, and mediation analysis.

Table 7. Weight of each second-order construct in Chinese and South Korean samples. (* indicates p < 0.01, ** indicates p < 0.05, *** indicates p < 0.001).

	Benefit (B)	Pressure (P)	T Statistics	Benefit (B)	Pressure (P)	t-Statistic
	China Sample			South Korea Sample
EB	0.588		5.794 ***	0.223		2.314 *
FB	0.119		0.987	0.621		6.588 ***
MB	0.561		5.568 ***	0.344		3.476 **
OP		0.332	2.841 **		0.587	6.955 ***
RP		0.497	4.939 ***		0.381	3.815 ***
SP		0.373	2.809 **		0.179	1.862

shows the weight of each second-order construct and the t-value. The results indicate that the perceived financial benefit of Chinese companies does not have an influence when the perceived societal pressure of Korean companies does not affect the perceived pressures.

Table 8. Hypothesis testing results for Chinese and South Korean samples. (* indicates p < 0.01, *** indicates p < 0.001).

Hypothesis	Path	Coefficient Size	t-Value	Result	Coefficient Size	t-Value	Result
		China Sample			South Korea Sample
H1	Benefit->Usage Intention	0.358	6.205 ***	Supported	0.305	5.329 ***	Supported
H2	Pressure->Usage Intention	0.157	2.439 *	Supported	0.194	3.574 ***	Supported
H3	Pressure->Imitation	0.497	11.729 ***	Supported	0.55	12.497 ***	Supported
H4	Imitation->Usage Intention	0.318	5.616 ***	Supported	0.345	6.664 ***	Supported

shows the hypothesis testing results for China and Korea. For the Korean sample, all hypotheses are accepted at the p ≤ 0.001 level; for the Chinese sample, all the hypotheses are accepted at the p ≤ 0.001 level, but hypothesis 2 is accepted at the p ≤ 0.05 level.

Table 9. Mediating effects evaluation results. (*** indicates p < 0.001).

	Coefficient Size	Standard Error	t-Statistic	Coefficient Size	Standard Error	t-Statistic
	China Sample (without IM: 0.526)			South Korea Sample (without IM: 0.578)
IM → UI	0.359	0.06	5.953 ***	0.395	0.053	7.531 ***
Pressure → IM	0.494	0.043	11.476 ***	0.533	0.044	12.226 ***
Pressure → UI	0.348	0.058	5.978 ***	0.366	0.054	6.749 ***

Note: The bold values in the table represents the mediation test effects.

shows the values that should be considered in the mediating effect analysis process for Chinese and Korean samples (presented in bold letters).

5. Discussion and Conclusions

5.1. Research Summary

In this study, we identified environmental, financial, and managerial benefits as three second-order constructs of perceived benefits, and societal pressure, organizational pressure, and regulatory pressure as three second-order constructs of perceived pressures. As one type of herd behavior, imitating others is proposed as the mediator variable in the relationship between perceived pressure and usage intention and the possible reason for operating the contrasting mechanism. Moreover, we conducted a comparison study to explore the differences in organizations in China and South Korea.

Based on the research model, a series of four hypotheses was formulated. Then, a questionnaire was developed to collect data to test these hypotheses. The survey was administered in China and South Korea, and the hypotheses were tested statistically using various analysis techniques. In summary, the results of hypothesis testing indicate that (1) the perceived benefit of GHG Protocol usage has a positive impact on the intention to use GHG Protocol Tools; (2) the perceived pressure of GHG Protocol usage positively affects the intention to use GHG Protocol Tools; (3) the perceived pressure of GHG Protocol usage positively influences the behavior of imitating others; (4) imitating others is positively associated with the intention to use GHG Protocol Tools; (5) imitating others has a partial mediating effect of perceived pressure on the intention to use GHG Protocol Tools. Moreover, the comparison study analysis results showed the differences between Chinese and Korean companies. For the Chinese company sample, the financial benefit does not form the perceived benefit, while the other order for perceived benefits is a managerial benefit (0.561), environmental benefit (0.588); for perceived pressures, we observed organizational pressure (0.332), societal pressure (0.373), and regulatory pressure (0.497). Chinese sample companies seem to believe that financial benefit is not a significant factor in the perceived benefits of using GHG Protocol Tools, and regulatory pressure is most important for the pressures that they perceive. For the Korean company sample, societal pressure has no contribution to the perceived pressures. The weight order of other second-order constructs is, for perceived benefits, environmental benefit (0.223), managerial benefit (0.344), and financial benefit (0.621); for perceived pressures, it is regulatory pressure (0.381), organizational pressure (0.587). Although Korea is an eastern country, similar to China, companies in Korea do not consider societal pressure as an intense pressure that they perceive. The possible reasons may be that (1) the public environmental pressure in Korea is not as severe as in China; (2) compared to their image, Korean companies are more interested in practical performance, which could also be the reason for the high weight of the perceived organizational pressure.

5.2. Theoretical Implications

Environmental sustainability is a significant challenge. This study increased the interest and coverage of this topic [30]. CO₂ emission is the most critical reason for climate change; following the global trend, CO₂ emission reduction has a special meaning for China and South Korea. Focusing on the usage intention of GHG Protocol Tools in China and South Korea, this study can be the start of the research in this domain. GHG Protocol Tools are protocol (standard)-based tools dedicated to GHG emission reduction. By adopting a dual model and second-order construct framework, this study may motivate further research. This work presents a rich set of research opportunities—for example, incorporating other second-order constructs and applying the mechanism framework in different contexts. Researchers seeking relevance in their studies could develop propositions based on the proposed framework and extend the relevant research further. For example, future studies could focus on the government’s usage intention of such tools. This study provides a basis for future empirical research in this area—for example, to improve the accuracy of measurement items for the current variables in this study and the additional ones in further research.

Most importantly, this study introduces the herd behavior concept into the research model, enriching the understanding of the widely accepted relationship between perceived attributes and usage intention. There has been a long history in the IS area of research on user adoption. Almost all the existing research on systems’ or tools’ adoption and acceptance has focused on the impact of users’ beliefs, as if they are the only individuals in society, without considering the possible effects from others—for example, herding behavior. By adopting the term “imitating others”, proposed as one type of herd behavior by [10], this study verifies the impact of imitation in the adoption process. This research makes an effort to collect the existing literature on herd behavior. It summarizes the three types of herd behavior, providing a benchmark for future studies. Furthermore, this study conducts comparison analysis, and the research results offer indications for other researchers to understand the differences between Chinese and Korean companies.

5.3. Practical Implications

This study also provides several implications for the practice. Firstly, this study may increase environmental protection awareness and motivation to decrease CO₂ emissions in China and South Korea. Secondly, for all the stakeholders of the GHG Protocol Tools, this study enables a better understanding of the critical issues and the adoption mechanism of GHG Protocol Tools. Primarily, for future users, providers, and promoters of GHG management relevant tools, the practical implications are described in the following.

The research presents that GHG Protocol Tools can provide environmental, financial, and managerial benefits for the overall tools’ potential users. Furthermore, on the other hand, they should pay more attention to societal, organizational, and regulatory pressure, which are also reasons for adopting GHG Protocol Tools. One significant indication of this study for potential users is that imitating others can be a strategy for adopting any system. It can help them to reduce the time, cost, and energy to choose one acceptance technology. However, previous research noticed that this strategy is not always a good choice. Therefore, the future tools adopter should pay special attention to herd behavior in the adoption process while considering the perceived benefits and pressures of using GHG Protocol Tools.

This study shows that imitating others, a form of herd behavior, exerts a significant influence on the usage intention of GHG Protocol Tools. Therefore, creating herding effects can enormously improve the usage intention of the tools. There are three types of herding behavior: reputational, compensation-based, and information cascade-induced herding. Thus, tool providers should consider these different types of herding to create a herd effect in the marketing process and improve usage intention. For example, a provider of tools can compile a list of well-known adopting businesses, and then potential users may increase their usage intention because of reputation factors. In other words, they follow the big names. Moreover, the providers may collect the industry status in the target customers’ domain. If the potential users see the adopting competitors, their usage intention will increase because of the compensation-based imitation, since they do not want to lose their competitive advantages. Moreover, the tool provider can apply the advertisement strategy to promote them repeatedly, and later potential users may decide to use the tools because of the information cascade.

Furthermore, the results show differences among samples; therefore, tool providers should design different marketing strategies for other groups. For example, the research results indicated that Chinese companies do not expect the significant role of GHG Protocol Tools’ financial benefits. Thus, while trying to introduce the economic benefits of the GHG Protocol Tools, Chinese companies should emphasize the environmental and managerial benefits more. However, for Korean companies, the analysis results suggest that financial benefits play the most critical role in formulating the perceived benefits of GHG Protocol Tools’ usage. Therefore, the economic benefit may be a crucial factor in the success of the adoption of their products.

The tool promoter mainly refers to government agencies. Moreover, because of the differences in the different groups, the governments should devise a strategy to promote the usage of GHG Protocol Tools. For Chinese companies, the analysis results show that regulatory pressure plays the most critical role in formulating the perceived pressures that drive the use of GHG Protocol Tools. Thus, the Chinese government should continue its efforts in implementing environmental protection regulations. For Korean companies, according to the result that organizational pressure is the critical component for perceived pressure, a focus on organizational pressure may be a more effective method to lead the usage of GHG Protocol Tools. Moreover, the herd literature indicated that information cascade might lead to imitation. Thus, education programs on the promotion of GHG Protocol Tools can effectively foster the usage intention of GHG Protocol Tools.

5.4. Insights for International Policy

This study has taken a unique context of inquiry to explore the factors influencing GHG Protocol Tools’ usage in firms in China and South Korea. In this research setting and context, several broad insights for international policy can be informed from this study. First, the framework suggested in this study through different constraints is informative for firm-level responsible behavior in international contexts. This contributes to the research investigating the relationship among environmental regulations, environmental strategies, and the corporate performance of environmentally responsible systems.

Second, identifying effective mechanisms for firm-level responsible behavior is essential, as some mechanisms are unique to contexts and settings. Firms in different contexts and national settings will have differing motivations for innovation, performance, and strategies while trying to engage in responsible behavior. For example, in some national settings, the role of CSR in innovation is influential [13], while, in other settings, market-oriented reforms are essential for responsible behaviors [15], and, in collective societal settings, collaborative governance helps in environmental responsibility [16]. In this context, this study’s findings around factors in constrained settings and comparative evaluations across China and South Korea may inform policies in other countries and settings.

5.5. Limitations and Future Research Directions

This study has several inherent limitations because of the trade-off between the rigorous research design and resource limitations. Because a third-party consulting company collected the data, this study could not control the size and choice of samples. Therefore, the results may not be able to be generalized to all companies in China and South Korea across all industry sectors. However, the research target of this study is eco-label product companies, since we believe in the internal relationship with the pursuit of eco-label product certificates and eco-awareness. Thus, the research results can be generalized to companies that carry an awareness of environmental issues. Although this research conducted a comparison study between Chinese and Korean companies, the conditions in China and Korea are quite different; the assumption of identical conditions is not rigorous in this research. Moreover, based on previous research on adoption, this study derived the factors affecting GHG Protocol Tools’ usage intention. However, these factors only provide a general idea for understanding.

Therefore, the findings of this study need to be verified using a more extensive and varied sample. For example, expanding the sample’s industry representation can help to improve the findings’ generalization. Based on the more comprehensive selection, necessary modifications to the model can enlarge its generalizability. A more careful design for the comparison study should be considered to improve the rigorous research. For instance, the region and sector of the companies and the differences between the complicated definitions of small and large companies in China and South Korea need to be carefully identified. In the future, researchers can enrich the findings of this research by improving the measurement of influential factors in more specific ways, instead of only providing general ideas to improve the limitations of this study. Such improvement will allow researchers to understand the usage intention better. Moreover, more research on herd behavior for sustainability needs to be conducted in the future. For example, future research can explore the details of the three types of herding (reputational herding, compensation herding, and information cascade herding) and their relationships with different second-order constructs of perceived pressures.

5.6. Conclusions

GHG Protocol Tools play a significant role in environmental sustainability improvement and are increasingly becoming necessary for equivocally managing businesses and non-business organizations. The projected benefits and the perceived pressures have spawned optimistic forecasts for the usage of GHG Protocol Tools [1]. However, the effective internal mechanism of perceived benefits and pressure on GHG Protocol Tools’ usage intention remains unclear [24]. Insights from research, such as this study, have a role in suggesting appropriate mechanisms that can work in specific contexts and settings. Furthermore, such mechanisms have a differing role in collective societies, as the herd behavior or collaborative aspects of responsibility involve the herd behavior mechanisms highlighted in this study. Overall, the insights from this study have several managerial, theoretical, and policy-level implications in the context of environmental tools’ and applications’ adoption and implementation in firms situated in different national contexts and varied settings.