Impact analysis in the assessment of corporate sustainability by foreign multinationals operating in emerging markets: Evidence from manufacturing in Indonesia

Abstract

The private sectors’ role in pursuing sustainability and supporting the global agenda towards sustainable development is broadly acknowledged. In recent years, corporate sustainability assessment has emerged as key for supporting business to address sustainability in their operations. However, there remains a lack of consensus on what sustainability assessment is and how to implement it. With a focus on impact analysis within the broader assessment of corporate sustainability, this study seeks to provide further insight into the current practices of multinational enterprises in subsidiary-level operations. The study focuses on nine foreign multinational enterprises operating in the manufacturing sector of Indonesia, with insights from thirty-two respondents and documentary analysis. Findings reaffirm the status quo of a core reliance on regulations as the basis for sustainability considerations, although, highlight that external guidelines, standards and principles are pushing practices beyond seeking to satisfy mere base requirements. Broadly, organisations also appear to be embedding sustainability as a fundamental aspect of operational processes, and there are formal structures, processes and personnel being placed to support this. At the same time, however, there is still a significant gap between ideals promoted in existing literature and actual practice.