The Maritime Economist Magazine Spring 2015 | Page 9

THEMARITIME Economist

scholarly knowledge in plain language

organizational capability in performing business
operations consists of two key elements: (1) it is
embedded in business routines, and (2) it involves the
transformation of factor inputs to outputs inside the
black box of the firm.

Table 1: Input factor of greening capability
Items to measure greening cabability.
Dimension
Item
Company policy
(1) senior management support
and procedure (CPP) (2) mid-level management support

(3) cross departmental support

(4) company policies in support of environmental protection

(5) management systems in support of green shipping practices

(6) corporate environmental report in support of green shipping practice
Shipping
(1) handle shipping instructions electronically
documentation (SD) (2) handle invoices electroni cally

(3) handle payment notifications electronically

(4) handle bill of ladings electronically

(5) provide guidelines to handle shipping documents environmentally
Shipping equipment (1) eco-design for shipping packaging
(SE)
(2) eco-design for shipping cartons

(3) eco-design for shipping pallets

(4) eco-design for cargo containers

(5) cooperate with equipment suppliers to enhance environmental performance

(6) improve the design of shipping equipment to meet environmental standards
Shipper cooperation (1) shippers are involved in eco-design for cargo handling
(SC)
(2) shippers are involved in enhancing environmental performance

(3) shippers are involved in green delivery
Shipping materials (1) reduction in packaging materials
(SM)
(2) improvement in design of packaging materials

(3) improvement in packaging
Shipping design and (1) compliance with energy saving
compliance (SDC) (2) compliance with equipment reuse

(3) compliance with recycling of waste

(4) compliance with recovery of waste

(5) compliance with reducing environmental negative impacts

ME Mag

Figure 1: Greening Capability

Organizational capability is a collection of routines
undertaken by firms for producing significant
outputs. This study examines greening capability with
a focus on assessing the ability of shipping firms to
simultaneously mitigate environmental harm and
enhance financial performance. We use an input/
output approach, i.e., data envelopment analysis
(DEA), as a tool to calculate the efficiency score of
each firm for benchmarking purposes. DEA is a
nonparametric Operations Research method for
measuring the productive efficiency of firms. In
examining the greening capability, the inputs are
green shipping routines while the output is firm
performance (in terms of environmental performance
and financial performance). In the context of shipping
operations, green shipping routines comprises six
routines, namely Company Policy and Procedure
(CPP), Shipping Documentation (SD), Shipping
Equipment (SE), Shipper Cooperation (SC), Shipping
Materials (SM), and Shipping Design for Compliance
(SDC).

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