Sustainable Firm Performance Research Articles

Sustainability performance of firms in the emerging economy: The role of corporate governance and corporate strategy

Despite the significance of the company’s strategy decisions in shaping the governance of the board toward sustainable performance, an inadequate study has focused on the role of corporate strategy in the association between corporate governance (CG) and sustainability performance (SP). This study examines the direct influence of corporate governance on sustainability performance, as well as through corporate strategy (CSTR) as a mediating variable. A panel data mediation methodology based on a series of panel data regression analyses was conducted using data from 126 listed non-financial firms over the 2012–2021 period. The study finds that corporate governance has a positive and significant contribution to sustainability performance. Furthermore, this study demonstrates that corporate strategy acts as a mediator that influences the link between corporate governance and sustainability performance. The findings of the study shed fresh light on the board members, practitioners, and policymakers for planning and promoting sustainability practices, as well as strategies and firm governance necessary for sustainable development. The paper concludes that companies with effective corporate governance structures stand a better chance of demonstrating better sustainability performance, specifically with strategy decisions targeted at sustainability integration. Our findings support the agency and stakeholder theoretical points of the study and are also consistent with Ludwig and Sassen’s (2022) findings.

Determinants of sustainable financial and innovation performance: a panel data analysis of Indian manufacturing SMEs

The contribution of Indian manufacturing small and medium enterprises to the gross domestic product has been consistently falling across the last few years as they have been struggling to survive and scale up due to a host of factors. This study aims to provide important implications to improve their competitive position by trying to identify the determinants which influence the two critical indicators of sustainable firm performance-sustainable financial performance and sustainable innovation performance. To do so, we empirically analyse 486 R&D conducting SME manufacturing firms from the firm-level data for the period of 2006-2017. Our results indicate that the determinants have a disparate impact on both types of sustainable firm performance. The study reveals important theoretical as well as practical insights for the long-term sustainability and competitiveness of manufacturing SMEs.

Impact of Lean Manufacturing Practices on Sustainable Firm Performance: An Empirical Study Moderated by Lean Culture

Impact of Lean Manufacturing Practices on Sustainable Firm Performance: An Empirical Study Moderated by Lean Culture

Impact of Institutional Pressure on Cleaner Production and Sustainable Firm Performance

This study aspires to investigate the influence of institutional pressure (IP) on cleaner production (CLP) practices and sustainable firm performances in the clothing industry of Bangladesh. Moreover, the research work explores the mediating role of cleaner production between institutional pressure and firms’ environmental performance. It also analyzes environmental performance as a mediator between cleaner production and firms’ economic performance. Data were collected from 246 textile and garments manufacturing units and analyzed using structural equation modeling (SEM) with the partial least square (PLS) method. The study findings unveiled a direct and positive relationship between institutional pressure and cleaner production, environmental performance and cleaner production, and firms’ environmental and economic performance. The study’s results also reveals that cleaner production partially mediate the relationship between institutional pressure and environmental performance while environmental performance is also partially mediate between cleaner production and firm’s economic performance. The research outcomes recommend that the clothing manufacturing sector welcome institutional pressures and employ cleaner production practices, leading to sustainable performance. Finally, the study highlights the managerial and theoretical implications.

A strategic framework for developing sustainable value propositions

The discussion on firms’ sustainability performance has resulted in business organizations becoming more conscious of sustainability issues and implementing strategies to ensure sustainable value propositions. The purpose of this study is to explore strategies that firms could use to develop sustainable value propositions. Through an extensive literature review, the study proposed a conceptual framework and further developed hypotheses suggesting that the strategies such as stakeholder involvement, flexible decision-making, and social and environmental values could influence sustainable value propositions. The hypotheses were tested through quantitative research analysis using data collected from owners/managers in 143 SMEs in the coastal areas of Ghana. The data supported almost all the hypotheses, namely H1, H2, and H5-H8 with T-values and P-values of > 1.96 and < 0.05, respectively. This finding indicates that all three core antecedents of sustainable value propositions contributed 78 percent of variations in the model. However, contrary to expectations, the result also showed that shareholder orientation and employee orientation with T-values and P-values of ˂ 1.96 and ˃ 0.05, respectively, did not support sustainable value propositions resulting in rejecting H3 and H4. Despite this outcome, the study concludes that all three strategies are relevant and valuable to firms in developing sustainable value propositions. AcknowledgmentThis paper was supported by IGA/FaME/2021/004: SME Innovation Performance, Firm Sustainability performance and Influence of Pandemic on Entrepreneurial wellbeing.

Sustainable Performance through Digital Supply Chains in Industry 4.0 Era: Amidst the Pandemic Experience

Amidst the COVID-19 pandemic disruption, industry 4.0 technologies (I4TEs) and digital supply chains (DSCs) are reinforcing businesses to gain economic stability and agility to enrich their sustainable performance (S.P.). Survey methods have been deployed based on the constructs obtained from the literature. Data collection through a survey resulted in 202 valid responses. Confirmatory factor analysis (CFA) confirms the constructs and the mediating effect of the DSCs through partial least squares structural equation modeling (PLS-SEM). The study is among the few studies that examine the I4TE impact on DSCs and S.P. The results show that industry 4.0 technologies enhance the sustainable performance of firms. Results also show a complete mediation of DSCs on the inter-relationship between I4TEs and S.P. Those DSCs with I4TE inclusion can transform an organization’s strategic decision-making. For the authors, this study is the first of its kind. Although some of the literature explored different aspects of the concept of industry 4.0 and digitalizing supply chains, studies have yet to specifically evaluate the potential impacts of digital supply chains on sustainable performance. The novelty of DSCs is their support of firms in improving their preparedness, agility, and transparency to strengthen their sustainable performance. These DSCs will provide agile, collaboration, responsiveness, end-to-end visibility, and resilient supply chains to diminish supply risk and enrich preparedness and responsiveness to recuperate quickly from uncertainty amidst the pandemic. The study will help managers re-designing their strategic planning, resulting in new cost reduction and resilience models for supply chains. The study calls for firms to employ multiple DSCs once they have set clear strategic priorities. The overall findings of the work fill the literature gaps of studies in the digitalization of supply chains.

Entrepreneurial Orientation as a Determinant of Sustainable Performance in Polish Family and Non-Family Organizations

The paper investigates the relationship between entrepreneurial orientation and sustainable firm performance with the mediating role of innovation output in family and non-family businesses in the post-transition economy. In order to analyze these relationships, quantitative research on a sample of 322 Polish organizations was conducted. The research results show a few differences between family and non-family businesses concerning the influence of entrepreneurial orientation on innovativeness and sustainable organizational performance. Moreover, the study reveals the critical role of the proactiveness dimension in shaping long-term firm performance.

Sustainability impact assessment of new ventures: An emerging field of research

Entrepreneurs and start-ups are key actors in implementing environmental innovation and accelerating sustainability transitions. Thus, analyzing as well as predicting the impact of entrepreneurial ventures is central to management and entrepreneurship research. The sustainability performance, value and impact of incumbent firms and their products and services has been a key topic in business-related sustainability research for many years. However, assessing the sustainability effects of new ventures such as start-ups is a neglected area in the research literature. This article therefore provides an overview, including key definitions, a new conceptual framework, and notions that can help guide and inspire a future research agenda. In this way, it also serves as an introductory article for the Journal of Cleaner Production's special issue ‘Assessing and forecasting the sustainability impact of new ventures: Theories, methods, and empirical evidence’.

Supply chain driven sustainability: ambidexterity, authentic leadership and interorganizational citizenship behavior

PurposeThe purpose of this study is to examine how supply chain strategy affects a firm's sustainability performance and how the strength of that relationship is influenced by managerial authentic leadership (AL) and its associated impact on interorganizational citizenship behavior (ICB).Design/methodology/approachBuilding on the intersection of three theories: organizational ambidexterity, AL and ICB, a mediated moderation model is developed and tested using structural equation modeling based on the responses from a cross-sectional survey administered by the authors.FindingsThe results reveal that an ambidextrous supply chain strategy is positively related to firm sustainability performance and this relationship is strengthened by AL. Furthermore, this study finds that this moderating relationship is partially mediated by ICB.Originality/valueTo the best of the authors’ knowledge, this paper is among the first to empirically test the effect of supply chain ambidexterity on sustainability performance by explicitly considering how leadership characteristics can both directly and indirectly affect the efficacy of this relationship. The findings complement existing literature by providing novel insights into the ability of firm supply chain strategy to affect sustainability performance.

Going green: Impact of green supply chain management practices on sustainability performance.

The rising environmental challenges are capturing the attention of stakeholders of corporations due to increasing competition. The sustainable performance of firms does not merely gauge their economic performance but also their sustainable development. Since the environmental supply chain management of firms has an important part in maneuvering their sustainable performance, the present study focuses on assessing the impact of green supply chain management practices on the sustainable performance of the textile, automobile, and tobacco industries. The data were collected from 384 organizations and analyzed through SPSS and AMOS. The results reveal that the impact of green manufacturing, green purchases, eco-design, and green information system are significant and positive on the sustainable performance of the organizations, whereas the impact of cooperation with customers is insignificant. Similarly, the moderation of institutional pressures between green manufacturing, green purchases, eco-design, and sustainability performance is insignificant, whereas it significantly moderates between cooperation with customers, green information systems, and sustainable performance. The study is significant and novel for considering five different factors of green supply chain management (GSCM): green manufacturing, green purchasing, cooperation with customers, eco-design, and green information systems. Furthermore, adding institutional pressures as a moderator between GSCM and sustainable performance adds to the novelty and uniqueness of the research. The managerial implications have also been discussed.

Collaboration strategies in buyer-supplier relational (BSR) networks and sustainable firm performance: A trade-off story

A buyer firm can increase collaboration in its buyer-supplier relational (BSR) network by focussing on supplier-to-supplier interconnectivity (i.e., network density) or alternatively, by enabling supplier clustering. While the extant literature has considered the effects of these two strategies on firm financial performance, it has not shown whether a focal firm's buyer-supply network collaboration strategy affects its sustainable firm performance (SFP), specifically its environmental and economic performance. This paper investigates three key questions: (a) How do collaboration strategies influence SFP? (b) Is there an optimal mix of these two network strategies for fostering collaboration in a firm's BSR network? (c) Can a manager win on both environmental and economic frontiers by pursuing either strategy? Leveraging extant research on BSR networks, ambidexterity, and network theory, we propose a model linking collaboration strategies to SFP. We construct 330 multi-tier BSR networks and find strong support for the non-linear effects of both collaboration strategies on SFP. A response function analysis identifies the combination of strategies yielding the best outcome for SFP. We also find strong evidence for trade-offs between the performance variables. The results show that managers should focus on density as a lever while developing a minimal level of supplier clustering. We discuss academic and managerial implications of our findings for managing buyer-supplier relationships and enhancing a firm's performance.

Effective Crisis Management during Adversity: Organizing Resilience Capabilities of Firms and Sustainable Performance during COVID-19

Drawing on crisis management and organizational resilience literature, this study adopts a firm’s capability-based perspective of organizational resilience to examine how different sets of firm-based resilient capabilities a firm has developed can help a firm achieve sustainable firm performance during a crisis. We took a configurational approach and applied the fsQCA method to examine how various combinations of a firm’s financial, cognitive, and behavioral capabilities as causal conditions can affect firm financial performance. For the empirical analysis, 21 listed Chinese film and television firms were selected. We collected information on financial capability from 2018 to 2020, and on cognitive and behavioral capabilities and firm size in 2020. This study obtains six configurations or paths that lead to the improved performance. Overall, the findings indicate that if a large firm has a low level of financial capability, it needs to leverage its cognitive capability instead of behavioral capability. A small firm with high financial capability needs to quickly leverage its cognitive capability but can use less behavioral capability. On the other hand, small firms with low financial capability need to utilize its behavioral capability to take quicker actions. With comprehensive analysis and multiple-perspective comparison of configurations, the study proposes various response strategic suggestions for firms with different sizes during the COVID-19 epidemic in China.

The Outcomes of Entrepreneurship, Relational Capital and Innovativeness on Tourist Satisfaction

Addressing the needs of customers is fundamental to the success of companies, particularly in the long-term. In fact, most companies use customer satisfaction as a method to determine and evaluate their performance and outline their strategies for the future. Therefore, the main objective is to better understand entrepreneurship and new product development antecedents and implications on customer satisfaction, a key element for sustainable development. A model is proposed to assess the relationship between two antecedents of entrepreneurial orientation (EO) and new product development (NPD) and a measure of performance. Based on a survey sample of 137 tourism SMEs, the model was tested using Partial Least Squares (PLS). The results show that both the relational capital and innovativeness positively influence entrepreneurship and NPD. They also suggest a positive relationship between entrepreneurship and customer satisfaction. Although there is a positive impact of NPD on customer satisfaction, this relationship was not significant. In addition, the results indicate that relational capital and innovativeness positively influence customer satisfaction through entrepreneurship and NPD. Consequently, to improve the sustainable performance of tourism firms and to increase customer satisfaction, managers must invest in the development of entrepreneurship as well as in the development of new products and their antecedents.

Impact of Environmental and Social Reporting and Performance on Financial Performance of a Firm: An Indian Study

The article analyses the impact of environmental and social reporting on financial performance through two effects. First is the compliance mechanism, where the firm complies with the expected norms of the field, that is, transparency or unambiguity. Second is the disclosure mechanism, which states that the firm can choose what to disclose. We study how both these mechanisms work in the short and long term in the Indian context. We extensively study the sustainability reporting and sustainability performance of Indian firms. We analyse the impact of environmental disclosure/performance and social disclosure/performance on financial performance (accounting ratios, return on assets [ROA] and return on equity [ROE] of the firm). Analysing a sample of 56 companies for 2014–2021, we show that environmental and social sustainability disclosure positively impacts the ROA/ROE in the long run but not in the short run. Further, the environment and social disclosure positively moderate the positive influence of environment/social performance on ROA/ROE in the shorter run but not in the longer run. These results will help managers understand the strategic role sustainability disclosure can play and how environmental and social disclosure can be used to achieve higher legitimacy and reputation and hence maximize firm returns.

Study on the Impact of Supply Chain Dynamic Capabilities on Long-Term Performance of Enterprises

The risk of frequent disasters is becoming a huge challenge for enterprises and their supply chains. In particular, sudden global public health events have brought a great test to the supply chain. How to make sustainable planning and preparedness and smoothly carry out supply chain operations and obtain sustainable firm performance in the complex market environment requires urgent attention from industries and academia. The different effects of supply chain operational capability and dynamic capability on the long-term performance and short-term performance of enterprises are still unclear; therefore, a model was established to discuss this. Based on the theory of dynamic capability, a relational model between supply chain dynamic capability, supply chain operational capability, and firm performance was constructed, a hypothesis testing method and Amos software were used to verify the set model, and the mechanisms of supply chain dynamic capability and supply chain operational capability on firm performance were discussed. The empirical results show that supply chain operational capability has a mediating effect on supply chain dynamic capability and firm performance, and supply chain dynamic capability has a moderating impact on supply chain operational capability and firm performance. The supply chain and its enterprises should cultivate and continuously improve the supply chain dynamic capability as soon as possible, so that in the face of emergencies, the supply chain operation capability can be reasonably configured to avoid damage, improve firm performance, and gain competitive advantages.

CSR orientation and firm performance in the Middle Eastern and African B2B markets: The role of customer satisfaction and customer loyalty

Ample body of evidence suggests the presence of a direct relationship between corporate social responsibility (CSR) orientation and firm performance. However, this finding seems spurious and imprecise, likely due to missing intervening factors that mediate this relationship. This gap in pertinent literature has motivated the present study, as a part of which customer satisfaction and customer loyalty were examined as two probable mediators in the relationship between CSR orientation and firm performance. The findings yielded by surveying the representatives of 326 Saudi Arabian businesses that have extensive business-to-business (B2B) operations across the Middle East and African (MEA) markets revealed that the link between CSR and firm performance is a fully mediated relationship. We found that firms' pursuit of CSR orientation positively affects firm performance, which is sequentially mediated by customer satisfaction and customer loyalty. These findings suggest a role CSR orientation plays in indirectly promoting firm performance by enhancing customer satisfaction as well as customer loyalty. Therefore, as business and society are two intertwined, mutually interdependent entities, business owners are responsible for all stakeholders (e.g., employees, customers, suppliers, and community), and this stakeholder-driven CSR orientation leads to sustainable firm performance.

Big data analytics capabilities for reinforcing green production and sustainable firm performance: the moderating role of corporate reputation and supply chain innovativeness.

The literature review lacks empirical studies on the role of big data analytics (BDA) and green technological innovation capabilities (GTICs) in promoting the sustainable performance of the manufacturing industry. The primary objective of this study is to examine the role of BDA-technology capability, GTIC, and environmental orientation toward green production and sustainable firm performance. Moreover, this research paper investigates the mediating role of green production and green competitive advantage and the moderating role of corporate reputation and supply chain innovativeness. Primary data was collected from Pakistani manufacturing firms through the survey method. Structural equation modeling was applied to measure and verify the relationship of proposed hypotheses. Empirical findings show BDA technology capability, GTIC, and environmental orientation positively contribute to green production. Moreover, green production helps achieve a green competitive advantage, and green competitive advantage positively influences sustainable firm performance. Furthermore, mediating role of green production and green competitive advantage and moderating role of corporate reputation and supply chain innovativeness was also confirmed. This study contributes by developing a comprehensive model showing the relationship between organizational capabilities, BDA technology capability, GTIC, and sustainable firm performance by considering potential mediators and moderators. Thus, this research suggests enhancing green production and sustainable firm performance through adopting BDA technology capability and GTIC by Pakistani manufacturing firms.

GREEN HUMAN RESOURCE PRACTICES AND ENVIRONMENTAL PERFORMANCE OF FIRMS: A REVIEW OF LITERATURE AND RESEARCH AGENDA

This paper aims to provide conceptual and empirical literature on green human resource practices and environmental performance of firms. The paper adopted conceptual and theoretical approaches to achieving its objective. This was done by critically reviewing extant literature on green human resource practices and environmental performance of firms. Based on the review of extant literature, it was observed that green human resource practices stimulate the environmentally sustainable performance of firms. The paper identified research gaps for future studies based on the methodological gaps of extant studies identified. It is recommended that the link between green human resource practices such as green recruitment and selection, green performance appraisal, green compensation and benefits, and green training and development and the environmentally sustainable performance of oil firms in Nigeria should be further explore.

How do corporate social responsibility and green innovation transform corporate green strategy into sustainable firm performance?

In the context of today's dynamic world with the development of technology, running a green-oriented business for long-term viability is no longer an option, particularly for businesses in general and small-medium enterprises (SMEs) for long-term viability and sustainability . The present research examines the relationship between corporate green strategy and sustainable firm performance for SMEs by exploring the mediating role of corporate social responsibility and green innovation in the given context in an emerging economy. This study applies a quantitative approach by using a well-structured questionnaire for data collection. The target respondents were managers at senior and middle levels. There were 469 valid responses obtained from the main survey. The final data was included in the analysis using Smart PLS (version 3.3.2) Structural Equation Modelling (SEM) to investigate the relationships between constructs and latent variables and provides an extension to the current literature by providing an integrated model of corporate green strategy, green corporate social responsibility, green innovation and sustainable firm performance. In addition, the model's application to the emerging economy reinforces the originality of this study. This study therefore provides an integration of “three green” elements in a model which is also unexplored by the extant literature. Specifically, green strategy, green corporate social responsibility and green innovation are integrated, aiming to facilitate enterprises, improve environmental performance, enhance sustainable competitive advantages and achieve firm sustainability. Moreover, this study provides strategic thinking for long-term business development towards a sustainable balance of economic, social and environmental benefits, through which business leaders are encouraged to consider practical actions carefully to improve environmental performance as this is certain to develop business competitiveness and achieve sustainable business performance. • Integrated model of corporate green strategy, green corporate social responsibility, green innovation and sustainable firm performance. • Strategic thinking for long-term business development towards sustainable balance of economic, social and environmental benefits. • Encouraging to practical actions carefully to develop business competitiveness and achieve sustainable business performance.

CEO Vision Communication of Sustainability and Sustainability Performance

Even if sustainable development is well known for its critical role in firm economic benefits, survival, and growth, we still know little about the antecedents of how it works within the organization. The purpose of this paper is to establish how and when CEO vision communication fosters firm sustainability performance. Building on the framework of upper echelon theory and organizational sustainability literature, we proposed that vision communication of sustainability would catalyze organizational change, facilitating firm sustainability performance. Moreover, we also reveal the boundary condition of dialectical leadership. CEO dialectical leadership will accelerate the above positive associations. Data analysis results from 130 CEO and their 562 top management team (TMT) members supported our propositions. Theoretical implications and future research directions are also discussed.