An institutional environment encompasses three types: weak, strong, and heterogeneous. These types explain a different societal level of expectations, concerning the conditions and characteristics a socially responsible business must conform to. In regards to weak institutional environment, the businesses operate in a flexible atmosphere, which allows the business to have more opportunities in decision-making and without being constrained by external guidance. A strong institutional environment, on the contrary, is when the businesses are expected to adhere to certain standards or structures in order to sustain a quality of the maintenance. Lastly, a heterogeneous institutional environment refers to varied expectations from different sectors, and the maintenance must be conducted in a way that balances the viewpoints of different parties. To determine the environment whether it is strong, weak, or heterogeneous, the businesses can make its assessment by observing the patterns of thinking and behavior of the stakeholders.
