Corporate Sustainability Performance Research Articles

Sustainability performance in science and technology parks: how can firms benefit most?

PurposeAchieving good sustainability performance requires balancing higher economic profits with better environmental and social performance. Knowledge plays a key role in improving corporate sustainability performance, but this knowledge is becoming increasingly complex, specific and dispersed among many scientific, technological and business actors. Science and technology parks (STPs) are infrastructures designed to host varying types of organizations that can bring together new, disruptive knowledge. Our purpose is to unveil how these spaces can be drivers of sustainability performance for companies.Design/methodology/approachWe test our hypotheses on a longitudinal database of Spanish companies over the period 2009–2016 using structural equation models (SEMs).FindingsThis research confirms that a firm’s location in an STP helps improve its sustainability performance, provided that conditions are optimal in the STP. These optimal conditions are based on an abundance of knowledge spillovers available to the firm and the firm’s ability to harness them, especially those of a more disruptive nature, through absorptive capacity.Originality/valueResults of this study yield implications for academia in the form of future lines of research and practical implications for policymakers and managers of both STPs and the organizations that host them.

The Influence of Green Leadership and Entrepreneurship on the Sustainability of Manufacturing Companies: Mediation of Green Innovation and Knowledge Management

<em>The industrial sector is one of the main contributors to Indonesia's economic development and GDP. However, the growth of the manufacturing industry cannot be separated from negative effects such as waste or emissions produced. The industrial sector is under pressure to immediately reduce the impact of its production emissions and waste on the environment. It needs to transform in a greener direction to improve the company's sustainability performance which consists of 3 aspects, namely economic, environmental, and social. This research will examine the influence of green transformational leadership, knowledge-oriented leadership, and green entrepreneurial orientation on corporate sustainability performance through the mediating role of green innovation and knowledge management processes. The research will be carried out using qualitative methods on 133 manufacturing industries in Indonesia with Structural Equation Modeling (SEM) analysis with the Partial Least Square (PLS) method to test the hypothesis. The results of this research show that the role of mediation has a positive influence on the company's sustainability performance, especially the knowledge management process which can act as a mediator between green transformational leadership, knowledge-oriented leadership, and green entrepreneurial orientation and the company's sustainability performance.</em>

Competitive strategy and circular economy practice implementation toward corporate sustainability performance

AbstractThe impact of competitive strategy on corporate sustainability and the role of circular economy (CE) practices remains scanty in the extant literature. This study therefore examines the mediating role of CE practices on the relationship between competitive strategy and sustainability performance. Drawing on the natural resource‐based view (NRBV) theory and institutional logics (IL) theory, this study explores a framework that introduces competitive strategy as an antecedent variable in advancing CE practices and sustainability performance among firms in a developing economy. Using data obtained through a survey of 380 firms in Ghana, the results revealed that competitive strategy has a positive and statistically significant relationship with corporate sustainability performance. Additionally, CE practices mediate the positive association between competitive strategy and corporate sustainability. Our research extends the frontiers of the literature by combining the IL and NRBV theories to explain how competitive strategy influences sustainability performance via CE practices.

The effect of Sustainability Innovation, Proactive Sustainability Strategy, and Digital Transformation on Corporate Sustainability Performance

Purpose: Business sustainability is widely accepted as a crucial approach to ensure the long-term success of enterprises. This research aims to explore how proactive sustainability strategies, sustainable innovation, and digital transformation impact a company's sustainability performance.
  
 Method: Additionally, the study will use organizational culture as a moderator and add size and leverage as control variables to evaluate their effects. A total of 705 sample data were collected from the financial statements, annual reports, and sustainability reports of non-financial companies listed on the Indonesia Stock Exchange (IDX) between 2018 and 2022. To test the hypotheses investigated, multiple regression analysis was used.
  
 Results and conclusion: The findings reveal that proactive sustainability strategy, sustainability innovation, and digital transformation have a positive impact on corporate sustainability performance. Secondly, it was found that organizational culture cannot act as a moderator in the relationship between proactive sustainability strategy, sustainability innovation, and digital transformation.
  
 Research implications: The research highlights that to enhance long-term performance, environmental, economic, and social strategies should be supported by stakeholder engagement, governance and leadership, and communication strategies. Among these six elements, stakeholder engagement and communication strategies have the most positive impact on sustainability performance.
  
 Originality/value: This study has introduced three new aspects for measuring the Proactive Sustainability Strategy.

Retraction Note: How digitalization works in promoting corporate sustainable development performance? The mediating role of green technology innovation.

Retraction Note: How digitalization works in promoting corporate sustainable development performance? The mediating role of green technology innovation.

The Role of Digital Transformation, Corporate Culture, and Leadership in Enhancing Corporate Sustainable Performance in the Manufacturing Sector of China

The Chinese manufacturing industry faces many challenges to sustainable development. This study examines how transformational leadership, corporate culture, and digital transformation affect Chinese manufacturing organizations’ sustainability. It will also examine the moderating role of environmental dynamism and the mediating effect of innovation capabilities. A self-administered survey was distributed to 350 manufacturing companies’ owners, managers, leaders, and employees, etc. Participants were selected via convenient sampling. This data collection effort validated findings and empirically tested theories. Smart PLS structural equation modelling (PLS-SEM), quantitative research, and cross-research are used in this study. The findings suggest that corporate culture, transformational leadership, and digital transformation significantly affect organizations’ sustainability. Innovation capability does not affect the relationship between corporate culture and sustainability. However, it mediates the relationship between transformational leadership, digital transformation, and business sustainability. Innovation capabilities and business sustainability performance are moderated by environmental dynamism. This study contributes to sustainable corporate performance theory by showing managers how transformational leadership, digital transformation, and corporate culture can help manufacturing companies grow indefinitely. The findings have major implications for China, a highly industrialized nation. This study could benefit regulatory authorities, academic institutions, industry, government agencies, and researchers.

Humane Entrepreneurship in the Circular Economy: The Role of Green Market Orientation and Green Technology Turbulence for Sustainable Corporate Performance

The modern business world is confronted with growing social and environmental issues, which pose a serious challenge to pursuing sustainable growth. Drawing from the natural resource base view and stakeholder theory, this study examines the effect of humane entrepreneurship on sustainable corporate performance through the mediating mechanism of green market orientation and the moderating role of green technology turbulence. Cross-sectional data were obtained from Turkish small- and medium-sized enterprises (SMEs) across various sectors. This research adopts a quantitative approach. In total, 393 valid responses obtained from managers of SMEs were utilized to examine the above relationships. The results indicate that humane entrepreneurship has a positive effect on sustainable corporate performance. Humane entrepreneurship has a positive effect on green market orientation. Green market orientation has a positive effect on sustainable corporate performance. The relationship between humane entrepreneurship and sustainable corporate performance is partially mediated by green market orientation. The relationship between humane entrepreneurship and sustainable corporate performance is further strengthened in a highly green technology turbulent environment. The indirect positive effect of humane entrepreneurship on sustainable corporate performance through green market orientation is the strongest when green technology turbulence is high. Simultaneously examining the mediation and moderation relationships, we provide novel insights that extend traditional entrepreneurial vision to a more environmentally conscious humane entrepreneurship approach. The study provides a comprehensive picture of how green market orientation and green technology turbulence are involved in using humane entrepreneurship to achieve superior sustainable corporate performance in the circular economy context.

The impact of media attention, board independence on CEO power, and ESG in state-owned enterprises

This paper explores the interrelationships among the three key factors influencing the environmental context. Analyzing data from listed Chinese companies between 2012 and 2021, the study results found that excessive power of the state-owned company's CEO can hinder sustainable corporate performance. Furthermore, the independence of the board of directors cannot moderate the negative impact of the CEO's excessive power on environmental, social, and governance (ESG) performance due to “regulatory paralysis,” resulting in a lack of board effectiveness. The results of the constructed regression models indicate that Chinese state enterprises’ governance can be improved by attracting media attention to promote ESG performance. In addition, female executives as a factor lead to heterogeneity in the role of CEO power on ESG.

Prioritizing institutional pressures, green supply chain management practices for corporate sustainable performance using best worst method

The emerging institutional concerns regarding the environmental crisis over the past decades have promoted the implementation of green initiatives within the supply chain, aiming to reduce environmental harm while maintaining efficiency. This study employed the BWM from a double perspective, aiming to identify and rank institutional pressures for GSCM practice implementation and the importance of these practices for sustainable performance in the Moroccan manufacturing industry. The study used purposive sampling to identify respondents with supply chain management expertise. A survey was distributed to 124 potential respondents, resulting in 55 responses. Data collection occurred between April and August 2022, with an effective response rate of approximately 38%. The results indicate that institutional pressure increases the likelihood of firms improving their GSCM activities. Normative pressures are found to be the main influencing factor for businesses to implement GSCM practices, while mimetic pressures are the least important. However, certain GSCM practices, such as GP, ECO-D, and IEM, remain among the top three most affected by isomorphic pressures. The study also highlights the importance of certain GSCM practices, such as IEM, GP, and ECO-D, for firms' sustainable performance. Economic outcomes are perceived as the experts' priority, followed by environmental and social performance. This research provides a theoretical and practical foundation for decision-makers seeking to identify the pressures affecting the implementation of GSCM practices along with the activities that most likely contribute to improving various aspects of sustainable performance.

Analyzing Factors That Affect Korean B2B Companies’ Sustainable Performance

This study empirically examines factors that can influence the sustainable corporate performance of Korean business-to-business (B2B) companies with the help of unique survey data. Factors such as technological capability, the chief executive officer (CEO)’s risk-taking propensity, B2B seller skill, and key account management (KAM) are analyzed to clarify their impact on sustainable financial and non-financial performance. In particular, given that environment, society, and governance (ESG) reporting has recently been widely recognized as an important evaluation factor for companies, we look at the mediating effects of ESG management on sustainable business performance. The results show that the CEO’s risk-taking propensity and B2B seller skill significantly impact the company’s sustainable financial performance, while technological capability and the CEO’s risk-taking propensity significantly impact sustainable non-financial performance. The fact that a CEO’s risk-taking propensity affects both sustainable financial and non-financial performance indicates the importance of entrepreneurial competency in the sustainability of the company. Furthermore, the findings reveal that ESG management plays a crucial role in sustainable corporate performance. The mediating role of ESG management allows technological capability, B2B seller skill, and KAM to influence sustainable financial performance significantly. Likewise, all of the explanatory factors contribute to the company’s sustainable non-financial performance through ESG management. The findings are important for both practitioners and scholars because they emphasize the need to establish an optimal ESG management strategy for corporate survival and sustainability. Furthermore, this study underscores that ESG management should be implemented by all organizational members, from CEOs to employees. Future research will include more comprehensive samples and analyze various strategic factors not covered in this study to derive effective ways by which companies can increase their performance and sustainability. We will also explore the factors that contribute to good ESG management practices.

Digitalisation driving sustainable corporate performance: The mediation of green innovation and green supply chain management

In the current dynamic and technologically innovative world, operating a green-conscious firm is no longer a realistic choice for the sustainable and long-term financial viability of small-to medium-sized enterprises (SMEs) across all industries. In this study, we evaluated the link between digitization and sustainable corporate performance for small and medium Vietnamese organisations in the food and beverage sector. The current research body illustrates that different methodologies have been used to investigate how digitalisation (DI) affects business results. We investigated the link between the DI and sustainable corporate performance (SCP) of SMEs in an emerging economy environment via the lens of green innovation (GI) and green supply chain management (GSCM). As the aforesaid coupled linkage and its influence on sustainability had hitherto not been discussed in the literature, we focused on the mediating role played by GI and GSCM in the relationship between DI and SCP. We employed a quantitative methodology and gathered data through a carefully designed questionnaire administered to senior and medium managers. This yielded 405 valid replies. We then analysed the data by using Partial Least Square Structural Equation Modelling (PLS-SEM). The results were found to indicate a positive relationship between DI, GI, GSCM, and SCP. Additionally, they were found to illustrate the mediating role played by GI and GSCM in the relationship between DI and SCP. Therefore, we would encourage managers to engage in DI, GI, and GSCM in order to enable their organisations to achieve sustainability.

Unpacking women’s power on corporate boards: gender reward in board composition

AbstractParticipation of women on corporate boards has long been a topic of debate in academia and practice. Yet, the threshold of women's participation in a corporate board to obtain a synergetic impact on corporate  sustainability performance remains to be examined. Data from 19 European countries, having 2640 firm-year of observation, this study revealed that women on boards positively affect corporate sustainability performance in the European context, with an approximately 30% participation of women on boards (WoB) ensuring synergetic impact. This study further revealed that after the threshold of WoB participation, the market value of companies tends to be negative in the European setting. An indication of investors' reactions. The issue was first examined through the lens of the resource-based view, social role, agency and critical mass theories and then empirically tested. To reach a conclusion, this study employs both static and dynamic econometric models; thus, the finding is consistent and empirically robust. The research findings contribute to the current discussion on corporate governance and corporate sustainability performances issues, especially in the European context, and have implications for researchers, business practitioners, and policymakers.

The Role of Big Data in Circular Supply Chain Practices and Corporate Sustainability Performance

The green industry is a national priority target, with one of the indicators being the application of a circular economy. The application of a circular economy to the entire supply chain process is an effort to extend the service life of materials so that sustainability arises. The application of circular supply chains needs to be supported by digital technology to improve processes. This study aims to analyze the effect of circular supply chain practices on corporate sustainability performance and the moderating effect of Big Data. The hypothesis testing using SEM analysis tools. The number of samples used was 140, who are currently working or have worked in companies that have implemented a circular economy. [KM1] The results of the study show that Circular Supply Chain Practices do not influence on Corporate Sustainability Performance, so the moderating effect of Big Data is not supported. Therefore, managerial parties need to implement a circular supply chain in the company's business processes. Managers need to provide technical training related to designing environmentally friendly products and educational strategies to customers regarding the application of a circular economy. Nonetheless, this study also has limitations, in that it consists of only one variable, Circular Supply Chain practices, which affect Corporate Sustainability Performance. Thus, the next researcher should add other variables that can affect Corporate Sustainability Performance, such as the purchasing realized absorptive capacity variable. [KM1]Refer in research method section for my comment.

A Causal Linkage Between Corporate Sustainability Performance and Financial Performance of Select IT & ITeS Companies in India

A Causal Linkage Between Corporate Sustainability Performance and Financial Performance of Select IT & ITeS Companies in India

University of Pannonia Sustainability index (UPSi) for corporate sustainability

This paper explores the concept of corporate sustainability and the role of sustainability indi-cators in achieving the United Nations’ Sustainable Development Goals (SDGs). It emphasizes the need for companies to integrate sustainability principles into their strategies and operations while minimizing negative impacts on the environment, society, and economy. The study highlights the importance of using relevant sustainability indicators to measure and assess corporate sustainability performance. In this context, we developed the University of Pannonia Sustainability index (UPSi), a comprehensive indicator that monitors sustainability performance and supports decision-making in sustainability developments. A case study was conducted to demonstrate the effectiveness of UPSi in assessing corporate sustainability practices. The findings showcase the practical application of UPSi in identifying strengths, weaknesses, and areas for improvement in sustainability efforts. The examined public institution could improve its performance primarily in management indicators and in relation to greening and transportation, namely the use of renewable energy sources, zero-emission vehicles and sustainability-related expenses solutions can be proposed. This paper contributes to the field of corporate sustainability by offering a framework and tool to evaluate and enhance sustainability performance, thereby fostering a more sustainable future.

Corporate sustainable development performance through top management team's transactive memory system and organizational resilience: A moderated mediation analysis

Addressing the measurement of corporate sustainable development performance (SDP) in economic, social, and environmental dimensions is a pressing global challenge. This study investigates the intrinsic impact mechanisms of the top management team's transactive memory system (TMT TMS) on SDP within Chinese manufacturing firms. It extends the analysis by introducing opportunity alertness (OA) as a moderating variable and organizational resilience (OR) as a mediating variable. Notably, OA was found to have a moderating mediation effect on the TMT TMS-OR-SDP pathway. Data from 294 executives was collected through non-probability convenience sampling. Initially, exploratory factor analysis was conducted utilizing SPSS; confirmatory factor analysis was performed with the aid of AMOS. Additionally, hierarchical regression and the SPSS PROCESS macro were employed to test the hypothesized models and paths of influence. The results illuminate the positive impact of TMT TMS on SDP through the enhancement of OR, a relationship further strengthened by OA. This study adds to the theoretical understanding and offers practical insights for optimizing TMT TMS and OA to achieve corporate sustainable development.

How can organizations measure the integration of environmental, social, and governance (ESG) criteria? Validation of an instrument using item response theory to capture workers' perception

AbstractEvaluation of corporate sustainability parameters has become part of organizational management. Item Response Theory (IRT) serves as a valuable approach for quantifying and exploring observable variables associated with these parameters. Therefore, this article aims to propose, apply, and validate an instrument utilizing IRT to measure environmental, social, and governance (ESG) impacts on corporate sustainability performance, using the perspective of workers. Workers were chosen as key stakeholders for the present study, as they were pointed by previous research as central to corporate sustainability decisions. The present paper addresses a literature gap by introducing, implementing, and validating a research instrument, along with a comparative scale, to assess the effects of integrating ESG criteria on corporate sustainability performance. Workers of two major Brazilian electricity sector companies were respondents for this instrument. Multigroup IRT method was used to assess item discrimination and difficulty levels, and to construct a scale reflecting workers' perceptions of integrating ESG criteria. The questionnaire consisted of 15 items, demonstrating Content Validity Coefficients (CVC) above .97, confirming the instrument's content effectiveness. Cronbach's Alpha and McDonald's Omega were greater than .94 for both companies. Questionnaire items demonstrated satisfactory discrimination ability and varying difficulty levels, resulting in a five‐level scale to gauge the impacts of ESG criteria. This research contributes through the introduction and validation of the research instrument, the latent trait assessment scale, and the evaluation of workers' perceptions regarding ESG criteria impacts on corporate sustainability performance. In conclusion, the proposed instrument showed robust psychometric properties, displaying favorable reliability and validity parameters. It effectively measures the impacts of ESG criteria, providing interpretable levels aligned with the unique characteristics of its constituent items

Employee financial participation and corporate social and environmental performance: Evidence from European panel data

AbstractCompensation and benefit practices are mainly considered as instruments to align employee behaviour to an organization's strategic goals, such as economic outcomes. Going beyond this economic focus, this study examines whether and how employee financial participation, may drive corporate sustainability performance (CSP; i.e. social and environmental performance). We investigate the relationship between employee share ownership, stock option and profit‐sharing plans, on the one hand, and CSP, on the other hand. In addition, we investigate the relationship between narrow‐based employee share ownership plans (only eligible for top management) and broad‐based employee share ownership plans (all employees eligible), on the one side, and CSP, on the other side. Using a unique European panel dataset, the results indicate that companies with (broad‐based) employee share ownership plans portray higher CSP, while companies with profit‐sharing plans exhibit lower CSP when there is no share ownership plan present. Also, the positive effect of broad‐based employee share ownership plans on CSP is magnified when the employees own a larger stake in the company. The results indicate that employee share ownership increases stakeholder orientation, strengthening the mutual interests of the organization and employees to long‐term investments in terms of CSP, at the same time broadening their orientation to long‐term external stakeholders’ interests.

Do agency costs and business risk affect the corporate sustainability–financial performance relationship?

PurposeThe aim of this research is to examine the effect of corporate sustainability performance on financial performance and the role of agency costs and business risk in determining this effect.Design/methodology/approachThis study uses the data of 83 non-financial Turkish firms listed on Istanbul Stock Exchange during the period 2014–2021. Two-step system GMM models are applied to examine the study’s hypotheses.FindingsThe results indicate a positive effect of corporate sustainability performance on financial performance, and that this effect is significant only for firms that are more likely to suffer agency costs of equity, firms with R&D expenditures and firms with lower business risk.Practical implicationsThe results of this study confirm the importance of regulations introduced by regulators to support the sustainability initiatives for firms that have less ability to access funds required for their investments. In addition, the findings provide important insight into the role of the persistence of corporate sustainability performance in enhancing financial performance through mitigating managers' opportunistic behavior.Originality/valueTo the author’s knowledge, this research is one of few that examine the effect of agency costs and business risk on the corporate sustainability–financial performance relationship in emerging markets.

Towards to sustainable corporate performance through circular economy practices and corporate social responsibility in Vietnam

Towards to sustainable corporate performance through circular economy practices and corporate social responsibility in Vietnam