An important aspect of ecological change is the notion of environmental policy as tool in the co-ordination of sustainable business models and a long-term competitive outlook. In this context the last years have brought about so-called "soft" regulation, as in the development of certification systems within more general Environmental Management Systems (EMS). A particularly prominent role is here assumed on the European level by the Environmental Management Auditing System (EMAS). The introduction of EMS is expected to render both process innovations in terms of improved environmental quality and reduced production costs (as for energy, water, waste, materials) as well as product innovations, i.e. the development of eco-efficient products and services. Whereas the general cost-benefit relationship of EMS according to EMAS has already been widely determined, systematic research on the determinants of environmental innovations as well as the competitiveness of EMAS certified firms has been rather spurious. This study represents the first systematic attempt to deliver theoretically and methodically founded results on this issue. Besides appropriating the process and product sides we also account for organisational innovations.

In a first step twelve case studies were carried out among EMAS certified firms in the state of Baden-Württemberg. This provided evidence for both the immediate causation as well as infrastructural support of environmental innovations by adherence to the EMAS design. Increasing experience in environmental management, indeed, brings about an augmented scope of restructuring to eventually exceed the firm level and spillover into efforts directed at exploitation of environmental leeway in up- and downstream processes (e.g. energy supply, logistics). A second, co-integrative step made use of large scale telephone survey data, collected among all EMAS certified firms in Germany. This surfaced the diffusion of environmental innovations to be greatly advanced by the incentive scheme. According to econometric analyses by means of binary probit models the maturity level of the respective EMS possesses a significantly positive influence on the realisation of environmental innovations. A further important component of environmental innovations success is the strong integration of the various departments to be involved in the implementation of EMAS (most relevantly R&D). Learning processes initiated by assuming responsibility in EMS further contribute significant effects on the development of turnover and export.