Sustainable Business Practices Research Articles

Executive compensation, sustainable business practices and firm performance: a systematic literature review and future research agenda

PurposeThis paper provides the latest systematic literature review (SLR) of prevailing studies on the interrelationship among executive compensation, financial performance and sustainable business practices. This SLR is done in three parts: (1) examine the theories employed by previous studies; (2) identify the unique variables employed by researchers in analysing this interrelationship and (3) explore potential opportunities for further study in the field.Design/methodology/approachThis study conducted an SLR analysing studies from the Web of science, Scopus and EBSCO in over 20 countries from 2009 to 2022 published in several top-ranked journals. We utilised various search strings using the key phrases “executive compensation”, “CEO Pay”, “financial performance” and “sustainable business practices”. The initial sample of 27,210 was filtered with our meticulous inclusion and exclusion criteria to produce a list of 161 studies.FindingsOur findings are as follows: first, most studies encompassing this subject area lack multi-theoretical perspectives with agency theory being the most dominant theoretical viewpoint; second, we observed the use of monotonous quantitative research methods, with studies heavily lacking qualitative and mixed-method research approaches; finally, there is a palpable gap in cross-country studies.Research limitations/implicationsThere are a few limitations that must be acknowledged. First, the inclusion criteria ensured that only articles published in the CABS journal ranking of three star and above. Thus, this review may not be a precise reflection of the EC, FP and SBPs literature scope. The inclusion criteria also limit our review to only accounting, finance, management and business-related studies about the topic. Therefore, future studies could explore studies ranked three star and below and from other subject areas.Originality/valueThis study contributes to the existing literature by conducting a comprehensive SLR that examines both the theoretical underpinnings and empirical evidence on this topic. It builds upon previous research and extends our understanding of the interrelationship among executive compensation, financial performance and sustainable business practices.

Examination of the interplay between corporate governance theories and sustainable practices in companies: A review study

The objective of this review study is to comprehensively investigate and integrate existing corporate governance theory and its influence on sustainability performance. In light of the growing importance placed on sustainable development goals and ethical business practices, scholars and practitioners must comprehend the impact of corporate governance systems on sustainability results. This study aims to analyze academic publications in order to find patterns and trends in the literature. By doing so, it aims to get insights into how corporate governance theory may promote sustainability actions. This review aims to provide a detailed understanding of the intricate relationship between corporate governance structures and sustainable business practices by analyzing different aspects of corporate governance theories, such as agency theory, stakeholder theory, institutional theory, and legitimacy theory. The results of this study can provide helpful advice to governments, business executives, and investors that aim to improve sustainable performance through the implementation of efficient governance structures. Moreover, this review offers valuable knowledge for scholars and researchers regarding the specific corporate governance theories that are strongly linked to sustainable practices.

Long-term Impact of Chinese Family Businesses on Earnings Management under the Sustainable Business Concept

This study aims to delve into the long-term impact of Chinese family businesses on earnings management under the framework of sustainable business practices. Considering the significant role of family businesses in the global economy, this paper focuses on the criticality of their earnings management strategies to economic stability. Employing an in-depth case study methodology, the paper analyzes several successful family businesses to explore the practical implications of sustainable business models on earnings management. The research reveals that integrating the concept of sustainable business into corporate culture and orienting towards long-term development can balance short-term gains with long-term sustainability, thereby fostering the robust growth of the enterprise. The conclusions of this paper emphasize the need for family businesses to concentrate on collective efforts in areas such as social responsibility, innovation upgrading, transparency, and effective communication to achieve long-term and stable development. This study provides practical guidelines for sustainable business strategies tailored for Chinese family businesses, aiming to create more favorable conditions and establish a solid foundation for future long-term development.

Community Empowerment through Eco-Crowdinvesting in Green Business for Sustainable and Eco-Friendly MSMEs

The COVID-19 pandemic, coupled with climate change repercussions, has gravely impacted global economies, notably the MSMEs in Kelurahan Meteseh. These MSMEs, which play key roles in local tourism and cuisine, struggle with energy and capital issues. This community service program addresses these challenges by implementing a green economic ecosystem for these SMEs, leveraging digital platforms, and promoting environmentally friendly business operations. Methodologically, the project encompassed preparation, technology deployment and installation, technology transfer, and mentoring. To address these issues, a community service program introduced Eco-Crowdinvesting green business technology with solar panels to help MSMEs recover sustainably. Solar panels and the Eco-Crowdinvesting platform reduce operational costs, improve finance, and strengthen MSMEs, making energy affordable for them. In line with national digital and green economy strategies, this program gives MSMEs access to solar power and an innovative financing platform, strengthening their economic resilience, promoting sustainable business practices, and increasing environmental awareness.

Corporate governance, social responsibility and sustainability commitments by banks: Impacts on credit risk and performance

AbstractWith the increasing pressures to commit to social and environmental issues, banks align with stakeholders' expectations via corporate social responsibility (CSR), and sustainable development goals (SDGs) initiatives. Understanding how these initiatives affect credit risk and performance of banks is crucial for the economy. Relying on the dynamic generalized method of moments and data on Thai listed commercial banks from 2015 to 2020, we find commitments to good governance, CSR and SDGs largely have an opposite effect on bank credit risk and performance. Consistent with stewardship or resource dependency hypothesis, together with stakeholder and good management hypothesis, banks with more female directors, higher levels of anti‐corruption and SDGs commitments are associated with a reduction in credit risk. However, consistent with queen bee hypothesis and agency and trade‐off hypothesis, banks with larger board size, more female directors and higher levels of CSR and SDGs commitments underperform. This apparent contradiction between negative impacts on bank performance and positive impacts on credit risk can be reconciled by understanding the trade‐offs involved, the long‐term focus of sustainability initiatives, leading to a decline in short‐term performance but enhancing their resilience to adverse events, ultimately reducing credit risk. Our findings enable stakeholders to make informed decisions, improve sustainable business practices, and contribute to the long‐term success of banks and the broader society.

Is the accounting curricula keeping up with sustainability development?

ABSTRACT There is continuing demand from practitioners, standard setters, and regulators for accountants to have the knowledge and competencies to contribute to sustainable business practices, reporting, and assurance. Educators at all levels of the accounting curricula have a responsibility to upskill. This research examines the extent of sustainability education among all levels of accounting curricula. Publicly available course information at three levels in New Zealand – secondary school, university, and professional accounting – was analysed using content analysis. The research finds a lack of sustainability education at all accounting curricula levels, with uneven coverage that is focused on sustainability broadly with questionable breadth and depth. This inconsistency among accounting educators results in accounting graduates with varied exposure to sustainability. This research calls for collective responsibility and collaborative leadership among educators, professional accounting bodies, practitioners, standard setters, regulators, and society to ensure sustainability education keeps pace with the development of sustainability accounting practice globally.

COMPARATIVE ANALYSIS OF BUSINESS MODELS IN RETAIL: FAST CYCLE VS. LONG-TERM SUSTAINABILITY

This study conducts a comprehensive comparative analysis of fast-cycle and long-term sustainability business models in the retail industry. Through a mixed-methods approach, incorporating both quantitative and qualitative data, this research examines the key characteristics, underlying mechanisms, and impacts of these two contrasting models. The findings reveal stark differences in supply chain structures, design and production processes, marketing strategies, and consumer behavior. While fast-cycle models excel in speed, affordability, and trend responsiveness, they are associated with environmental degradation, ethical concerns, and a culture of disposability. Conversely, sustainable models prioritize ethical sourcing, environmental responsibility, and long-term value creation, but face challenges related to cost, scalability, and the need to balance timelessness with trend relevance. The implications for retailers, policymakers, and consumers are discussed, with a focus on the potential for hybrid models that combine elements of both approaches. This research contributes to the growing body of literature on sustainable business practices and provides valuable insights for retailers seeking to navigate the complex landscape of consumer preferences and sustainability demands.

The Influence of Environmental Sustainability Orientations on organizational Performance: A Review

This comprehensive review addresses a critical research gap concerning the relationship between Entrepreneurial Orientation (EO), Environmental Sustainability Orientation (ESO), and organizational performance. The study advocates for future research to delve into this uncharted territory, providing valuable insights for organizations and policymakers to promote entrepreneurship and sustainable business practices. It suggests a deeper examination of EO, specifically Innovativeness, Proactiveness, and Risk-Taking, as independent variables, alongside organizational performance as the dependent variable. The review emphasizes the pivotal mediating role of ESO, highlighting its strategic significance in differentiating firms and enhancing performance. It affirms the positive influence of EO on ESO, subsequently improving organizational performance. The review stresses the managerial implications of integrating EO dimensions into strategies for a competitive advantage, along with the importance of embracing ESO for reputation enhancement and cost reduction through eco-friendly practices. The study encourages future researchers to explore additional EO variables and utilize diverse data analysis tools to enhance understanding of the intersection of entrepreneurial and sustainability orientations.

Enhancing Corporate Sustainability through Just-In-Time (JIT) Practices: A Meta-Analytic Examination of Financial Performance Outcomes

This paper utilizes a meta-analytic approach to examine the correlation between Just-In-Time (JIT) practices and financial performance. The investigation assesses JIT’s influence on key financial metrics, including Return on Investment (ROI), Return on Sales (ROS), Asset Turnover, and Profit Margins. Results indicate a robust positive correlation between JIT implementation and enhanced financial outcomes, demonstrating that JIT significantly contributes to both operational efficiency and financial health. The findings illustrate that JIT’s effectiveness varies by organizational scale and economic context, with larger firms and stable economic conditions seeing the most pronounced benefits. Conversely, smaller firms might face challenges in harnessing JIT’s full financial potential, underscoring the importance of tailored implementation strategies. This study confirms the strategic value of JIT for boosting profitability and efficiency, providing managers with actionable insights to optimize JIT deployment. It also suggests areas for future research to refine understanding of JIT’s variable effects across different operational contexts and explore potential contributions to sustainability initiatives. This contribution enriches the discourse on JIT’s role in enhancing corporate financial performance and opens the door to examining its broader impacts on sustainable business practices.

Collaborating a Dependent Business Model: Corporate Social Responsibility - Evidence from India

The research concludes that businesses in developing nations, notably India, exhibit a steadfast commitment to Corporate Social Responsibility (CSR). Despite marked advancements in CSR procedures, there remains a judgment for businesses to transcend self-interest and embrace a broader societal perspective. For multinational corporations (MNCs), robust CSR practices are indispensable for upholding their reputational integrity. The research utilizes secondary data of the Net Profit after taxes, CSR Spending and Budget for the Fiscal Years 2017–18 to 2021–22, Share prices for the fiscal years 2017–18 through 2021–22 on the BSE and NSE, and Sector-wise distribution of CSR initiatives from company websites, online databases, and annual reports. The findings suggest that businesses in developing nations, including India, are committed to CSR. While there has been an improvement in CSR practices, businesses are still not consistently going above and beyond or solely focusing on themselves. This study contributes valuable insights into the evolving CSR terrain within India, shedding light on the strides made and the persistent challenges encountered in fostering a symbiotic relationship between corporate profitability and social responsibility. By delineating these nuances, the research seeks to inform stakeholders and policymakers about the trajectory of CSR evolution, thereby fostering a conducive environment for sustainable and responsible business practices. The study provides valuable insights into the CSR landscape in India and the ongoing efforts to integrate responsible business practices.

Learning from the Past Bridging Digital and Physical Markets: A Guidelines for Future Research Agenda of Online-to-Offline (O2O) Marketing Strategy

This bibliometric study comprehensively analyses the scholarly landscape surrounding Online-to-Offline (O2O) commerce from 2006 to 2023. Through a systematic review of existing literature with a bibliometric analysis approach, this research identifies pivotal themes, methodologies, and findings that characterize the evolution and impact of O2O strategies across various sectors. The study begins by tracing the conceptual foundation of O2O commerce, emphasizing its role in integrating digital and physical consumer experiences in response to the changing dynamics of consumer behaviour and market demands. It highlights the strategic adoption of O2O models by e-commerce entities and brick-and-mortar stores, aiming to create a seamless shopping journey by leveraging the strengths of both online and offline platforms. The analysis focuses on the strategic implications for businesses, including the decision-making processes regarding market coverage, delivery costs, and inventory management to enhance profitability and sustainability. The research further delves into consumer behaviour, examining factors influencing the preference for online or offline purchasing, such as demographic characteristics, product types, price levels, and perceived service quality. The findings reveal a dynamic evolution of O2O strategies, underpinned by a growing emphasis on customer engagement, technological innovation, and the strategic management of online and offline synergies. The research underscores the transformative potential of O2O commerce in bridging the gap between digital and physical marketplaces, enhancing consumer experiences, and fostering sustainable business practices. In conclusion, this bibliometric study sheds light on the multifaceted dimensions of O2O commerce, offering valuable insights for academics, practitioners, and policymakers interested in the strategic integration of digital and physical retail environments. It calls for continued research and innovation to harness the full potential of O2O models in meeting the complex needs of consumers and businesses in the digital era.

Developing a smart green supplier risk assessment system integrating natural language processing and life cycle assessment based on AHP framework: An empirical study

Global carbon reduction drives the transformations of corporations, emphasizing carbon and environmental impact within supply chains. A critical challenge in risk management is converting unstructured data into quantifiable information, and ruining the conversion often leads to ineffective risk assessments. While artificial intelligence is increasingly used in supply chain risk management, previous studies seldom integrate text analysis for risk extraction and lack accurate risk assessment methods. This study pioneers an intelligent green supplier risk assessment system integrating natural language processing (NLP) and life cycle assessment (LCA) based on an analytic hierarchy process (AHP) framework. The proposed approach utilizes NLP keyword extraction to identify and assess risk and uses LCA to uncover environmental risks, minimizing negative impacts. The text classification model attains 81.7 % accuracy, ensuring a trustworthy risk assessment system. The proposed method could significantly improve risk analysis efficiency, foster sustainable procurement, and elevate enterprise competitiveness in sustainable business practices.

Moderating role of enterprise risk management in the relationship between sustainability performance and a firm’s competitive advantage

The emergence of sustainable business practices has garnered interest among stakeholders. However, the question of whether sustainability performance provides companies with a competitive advantage is still being debated in the literature. This paper aims to examine the influence of sustainability performance – namely economic sustainability performance and environmental, social, governance (ESG) – on competitive advantage, with the effectiveness of enterprise risk management (ERM) as the moderating variable. This paper used 202 firm-year observations during 2015–2022 from non-financial sector companies listed on the Indonesia Stock Exchange. To test the hypotheses, panel data regression with a one-year time-lag analysis is conducted. The findings show that economic sustainability performance has no relationship with competitive advantage, while ESG has a positive effect. Furthermore, ERM effectiveness strengthens the effect of economic sustainability and ESG on competitive advantage. Further investigation used a two-year time-lag analysis for a long-term perspective. The analysis shows that economic sustainability performance and ESG have a positive impact on competitive advantage. In contrast, ERM effectiveness has no effect on the relationship between economic sustainability performance and competitive advantage. Moreover, additional analysis incorporates the effect of COVID-19 into the main model and shows that the pandemic did not affect competitive advantage; this is consistent with the main results. The findings encourage companies to improve their risk management and sustainability initiatives. The government may also take it into account when developing rules that promote the implementation of sustainable development. AcknowledgmentThis research was supported by the Ministry of Education, Culture, Research, and Technology of the Republic of Indonesia through the Center for Higher Education Fund (BPPT) and Indonesia Endowment Funds for Education (LPDP) for providing the Indonesian Education Scholarship (BPI-Beasiswa Pendidikan Indonesia).

Identifying and Dealing with Interdependencies and Conflicts between Goals in Manufacturing Companies’ Sustainability Measures

Companies are increasingly focusing on sustainable business practices. Internal and external stakeholders’ expectations manifest in legal requirements, national and international standards, and market and customer expectations, among other things, must be considered. In addition to profit maximization, which is the usual target for corporate management, management must consider environmental sustainability aspects such as resource efficiency, greenhouse gas intensity, and a company’s emissions behavior. In addition, social aspects related to the company’s employees, the immediate urban environment, the situation in the supply chain, and effects on the market environment must increasingly be considered. Specifically, companies are faced with the challenge of dealing with conflicting objectives regarding the various aspects of sustainability and, if necessary, weighing them up against each other. These trade-offs must be made against the company’s socio-economic and ecological environment, corporate strategy, and sustainability goals. This paper provides an overview of current approaches and research gaps on this topic through a literature review. It highlights the lack of methods and frameworks to specifically deal with trade-offs and conflicts between goals.

When and how to engage with employee environmental activism: Lessons learned from a global service firm

Employee activism, in which employees collectively press an organisation on societal issues, is a growing phenomenon. Many employees have been motivated by the climate crisis to demand more sustainable business practices and insist that employers tackle the issue. Ignoring such activism can have negative reputational effects. This paper examines two employee initiatives that tackled climate change in a global professional service firm and sheds light on how organisations can influence employee-driven undertakings and integrate them with more sustainable business models. Reflecting on best practices, but also on lessons learned from the cases, the article also suggests how organisations can help employee activists stay motivated and pursue their passion sustainably.

Owner-Manager Attitudes to Soft Skills Training in Malta’s Small Enterprises

A study of owner-manager attitudes to soft skills training in Malta and how these affect their small and micro businesses, and their learning as entrepreneurs. Talent retention and development may be overlooked when examining sustainable small business practice. In fact, training can help firms retain and develop a diverse range of employees, including those underrepresented in the workforce locally: upgrading skills rather than being caught in disruptive and expensive recruitment cycles (Bridge and O’Neill 2017; Klaus 2010). Training in soft skills (including interpersonal, communication, and listening skills as well as EQ) can provide a route to sustainable business growth. Studies as early as 2006 (such as Beaujean et al.) indicate that growing strong customer relationships is a crucial factor in achieving a competitive edge. Furthermore, the ‘impact of frontline emotional intelligence on the bottom line is clear’ and therefore work to encourage and develop such skills in employees is significant and worthwhile (Beaujean et al. 2006). This approach aligns well with key aspirations of the United Nations Sustainable Development Goals, especially number 9 (UN 2023). The attitudes of owner-managers, therefore, will certainly influence both whether soft skills are valued in the enterprise and whether all employees are offered training in these areas. This, in turn, may affect whether the business reaches its full potential.

Unveiling barriers to Industry 5.0 adoption in supply chains: a DEMATEL approach

Purpose The objective of this research is to investigate the barriers impacting the integration of Industry 5.0 (I5.0) in supply chain sustainability. By understanding these challenges, this study aims to provide valuable insights that can guide organizations in successfully implementing the transformative potential of I5.0. The ultimate aim is to improve operational efficiency and advocate for sustainable practices within supply chains. Design/methodology/approach Research has used industry expert interviews, a comprehensive literature review and the decision-making trial and evaluation laboratory approach for analysis. Industry expert interviews serve to capture first-hand insights from professionals well versed in the field, providing practical perspectives on the barriers to I5.0 adoption. Findings This study identifies technological challenges, organizational barriers, regulatory impediments and economic constraints as pivotal factors inhibiting the widespread adoption of I5.0 in supply chain sustainability. Research limitations/implications This research serves as a foundation for future investigations into overcoming barriers to I5.0 adoption, guiding scholars and practitioners in refining strategies for successful implementation. Practical implications The findings offer practical insights for organizations aiming to adopt I5.0, informing decision-makers on key challenges and facilitating the development of targeted strategies to overcome them. Social implications The social implications lie in fostering sustainable business practices through the adoption of I5.0, contributing to environmental responsibility and societal well-being. Originality/value This research contributes original insights from practitioners, policymakers and researchers in navigating the complex landscape of I5.0 adoption, ensuring meaningful contributions to both academia and industry.

Implications of corporate social responsibility on the financial and non-financial performance of the banking sector: A moderated and mediated mechanism

This study aims to investigate the influence of corporate social responsibility (CSR) on both financial and non-financial performance in the Pakistani banking sector by applying a quantitative research approach to the primary data from 405 branch managers in the Pakistani banking sector. Both financial and non-financial performance indicators are analyzed in relation to CSR practices. The CB-SEM findings of this study reveal a significant and positive correlation between CSR and both financial and non-financial performance. Our results demonstrate that CSR initiatives contribute to improved financial performance, reputation, and innovation within the sector. These findings confirm the importance of prioritizing social responsibility initiatives to enhance overall performance in the banking industry. This study provides valuable insights into the impact of CSR on performance in the context of the Pakistani banking sector. The research contributes to the existing literature by highlighting the positive relationship between CSR and financial/non-financial performance. The findings underscore the relevance of CSR practices for banks in Pakistan and emphasize the potential benefits of incorporating social responsibility initiatives into their operations. This study serves as a foundation for future research, encouraging further exploration of CSR's role in the banking industry and its implications for sustainable business practices.

Aligning servitization and circularity: The role of institutional confluence in sustainable business models

This conceptual study explores the alignment between servitization—a shift from selling products to offering services—and circularity principles. The study introduces institutional confluence—a configuration of institutional pressures that enhance business model legitimacy to stakeholders and facilitate operational success— which can serve as a driver aligning servitization with circular principles. Institutional confluence has the capacity to trigger novel business models, shape resources and processes, enhance value capture, and inhibit unsustainable business models. The study develops the concept and underscores the role of institutional confluence in promoting this alignment and subsequent environmental sustainability. The article utilizes illustrative case examples from servitization and circular business models to develop the concept of institutional confluence serving sustainable servitization. The study offers strategic insights for managers and policymakers, emphasizing the need for a holistic approach that integrates servitization and circularity from the outset of business model design. It advocates for policies that leverage regulatory, normative, and mimetic pressures to foster sustainable business practices. The article contributes to the servitization literature by delineating the mechanisms through which institutional forces facilitate or hinder the integration of servitization and circularity, offering directions for future research to explore these dynamics across different contexts and industries.

SKILL MANAGEMENT IMPACT IN INDIAN MSMES TOWARDS SUSTAINABLE CONSUMPTION AND PRODUCTION PATTERNS IN THE CONTEXT OF CSR PRACTICES

Upskilling is a prevailing trend in the workplace that provides employees with updated and advanced training programs and opportunities to enhance their skills and bridge skill gaps. Sustainable consumption and production patterns and green CSR practices are pervasive in Indian MSMEs to become a greener economy. The consumer demand for sustainable products is visible across the globe, creating opportunities for Indian MSMEs in the international marketplace. In light of this fact, the present research article aims to analyze the current gap in past studies concerning MSMEs by investigating the correlation between sustainability practices, specifically with respect to sustainable consumption and production patterns, green CSR initiatives, and the performance of MSMEs. This study aims to examine various viewpoints on MSMEs' sustainable business practices, which are a) how sustainable consumption impacts the efficiency of MSMEs, b) the influence of sustainable production patterns on MSMEs' performance, and c) the impact on the efficiency of MSMEs' operations as a result of CSR activities.A self-structured questionnaire has been sent to the MSMEs' owners, managers, directors, and administrative officers through email to conduct the research work. In addition, a structural Equation Model (SEM) was used to sample 130 Indian MSMEs. The study's main findings are that the sustainable consumption and production patterns of skill-based CSR practices impact the efficiency of MSMEs in India. It has also been discovered that their sustainable practices are generating global market opportunities. This study has important implications for MSME owners and policymakers because applying sustainable consumption and production patterns and implementing skill-based CSR practices as sustainable strategies will create a greener economy and positively impact the performance of MSMEs.