4 - Nonmarket Strategy

Summary

Companies’ social and environmental performance has not kept pace with rising pressure for greater contributions to social and environmental improvements. Much of the this pressure comes from nonmarket stakeholders – the environmental groups, community activists, governments, and other actors who engage with companies in a variety of venues to improve their environmental performance. Much of companies’ engagement with these stakeholders involves creating and managing various types of formal and informal institutions. Effective institutions can mitigate collective action problems among companies and their stakeholders, leading to sustainable environmental improvements.