One area where these theories have been used to understand when organizations undertake actions
beyond their narrowly defined interests is the study of corporate environmentalism when firms or
industries take proenvironmental action beyond regulatory demands. Business decisions about
resource use and conservation have often been understood as a rational organization pursuing the
defined goal of profit. A strong case has been made that acting on environmental issues such as climate
change accomplishes the business goal of profit maximization through improved reputation and
increased legitimacy, decreased government regulation, long-term economic goals, decreased risk of
liability, and production cost savings among others (Aupperle, Carroll, & Hatfield, 1985; Burke &
Logsdon, 1996; Hoffman, 2006b). Lyon and Maxwell (2004) expand this approach to use economic
tools to model the political economy of corporate environmentalism. Their contention is that cost
reductions from ecoefficiency and increases of market demand from green consumers are only
modest influencers of corporate environmental action, and the real driver is the state and public
policy. Using a policy life cycle approach they demonstrate that once an issue has the potential to be
regulated, the costs to firms increase with time: voluntary actions that preempt new laws have the
lowest impact on firms, trying to influence regulations has a greater impact on firms, and deflecting
enforcement at the end of the policy life cycle has the highest impact on firms.