ABSTRACT
Executives in Central Europe must operate in complex and uncertain economic conditions as their countries undergo a transition from socialist to market systems. The transition affects every segment of society (Jackson et al., 1993). One of the most critical challenges facing Hungarian managers is how to resolve the conflicting pressures of attaining fmancial stability for their companies while at the same time coping with potentially serious problems such as environmental pollution. The stereotype of managers from third world or formerly communist countries as being oblivious to or unconcerned about the dangers of environmental degradation arises from the belief that the government and the private sector continue to avoid the costs of environmental protection and cleanup (Pearson, 1987). Although Hungary's economy is just emerging from a long period of stagnation and its GDP per capita ranks only 56 among the 160 countries for which the World Bank and the United Nations Development Program provide comparative economic statistics, its human development index (the combination of GDP per capita, illiteracy rate, average number of years spent in school and life expectancy) ranks higher than some Western European countries (World Bank, 1994). Because education levels and environmental awareness are correlated, the concern for a clean environment should be relatively high in a country like Hungary. Given Hungary's human development index and its desire to become a member of the European Economic Community, its corporate executives should be willing to adopt higher environmental standards as quickly as possible.
