Firm Speed and Environmental Accidents

Firms can achieve competitive advantage by performing activities faster than rivals, but less understood is how firm speed may have environmental consequences. This study empirically examines the role of firm speed in organizations’ subsequent environmental performance. Our basic premise is that faster operations are more likely to lead to worse environmental performance in the form of more environmental accidents. We then examine how firms can mitigate this speed versus environment tradeoff. Specifically, we expect that this relationship is mitigated by more automation, more project diversity, and greater labor market thickness. We find support for these ideas using data from oil and gas drilling projects in Pennsylvania.