Implications of COVID-19 policies on the sustainable corporate practices of European firms

Abstract

PurposeThis study aims to analyze how mixes of COVID-19 policy responses are shaping the context in which companies will compete in the following years, defining how the crisis might impact firms’ ability to keep their commitments to sustainable practices.Design/methodology/approachEuropean country-performance data for the years 2019 and 2020 were grouped into indicators of macro sustainability, then cross-analyzed against the policies adopted during the period (also grouped based on their impacts on sustainability pillars), using correlations, factor analysis and clustering.FindingsThe influence of traditional sustainability determinants was reframed according to the novel context shaped by the policy responses to the pandemic crisis. The social and digitalization aspects gained the most relevance and appeared interconnected, with digitalization of employment attaining overall more traction. Moreover, changes in the leadership within sustainability domains were observed for each identified country-cluster, due to newly implemented emergency policies. In fact, environmental innovation, digitalization and social support policies appeared to be the main variables to be impacted by the intensity of the policy efforts.Practical implicationsBusinesses monitoring the developments of sustainability policies closely, will observe novel trends in technological applications.Social implicationsPolicymakers and researchers may gauge the efficacy of policies against the COVID-19 crisis in the domain of sustainable development and resilience.Originality/valueThis paper provides a cross-analysis of quantitative macroeconomic and quantified policy responses to the 2020 pandemic crisis, linking each indicator to the pillars of sustainability that were relevant for companies between the crucial pandemic outbreak years 2019 and 2020.