Previous research is inconsistent and narrowly focuses on defining environmental management capability (EMC) and the outcomes of its relationship with sustainable performance. This study aims to focus on a broader range of issues while considering different perspectives on logistics operations. We first defined EMC and examined its relationship and sustainable performance from contingency and configuration perspectives. We define the EMC concept as a second-order latent construct that encapsulates the synergy among three primary EMC components: Environmental Management System (EMS), Supplier Environmental Management (SEM), and Internal Environmental Monitoring (IES). Additionally, leveraging the theory of performance frontiers, we developed differentiated strategies based on survey data collected by the Global Manufacturing Research Group, which represents developed, emerging, and developing economic regions.

Manufacturers may initially observe limited direct impacts of EMC on sustainable performance. However, our findings reveal that firms in emerging economies exert the most effort in implementing environmental management capabilities compared to those in developed and developing nations. Firms in developed countries are increasingly reaching the “diminishing point” of their performance, investing just enough resources in EMC to maintain their competitive position as order qualifiers rather than order winners. Meanwhile, firms in emerging economies are rapidly advancing in both environmental and business performance, while those in developing countries are striving to close the gaps. This insight is crucial for managers, especially in multinational corporations, highlighting the need to adapt to varying economic conditions and development stages, and to allocate resources appropriately and effectively.

Keywords: Economic development, Environmental management, Supplier Environmental management,