| Title | Relationship between corporate sustainability performance and corporate financial performance: evidence from U.S. companies |
|---|---|
| ID_Doc | 76101 |
| Authors | Matuszewska-Pierzynka, A |
| Title | Relationship between corporate sustainability performance and corporate financial performance: evidence from U.S. companies |
| Year | 2021 |
| Published | Equilibrium-Quarterly Journal Of Economics And Economic Policy, 16, 4 |
| Abstract | Research background: Sustainable development at the enterprise level is understood as the integration of economic, environmental and social dimensions aimed at meeting the needs of all firm's stakeholders in the present and in the future. Therefore, it is crucial to evaluate the relationship between economic, environmental and social sustainability performance of a company and its financial performance. Purpose of the article: Considering the business model for sustainability as well as the debatable results of empirical research on the relationship between corporate sustainability performance (CSP) and corporate financial performance (CFP), the essential aim of the paper is to answer the question whether the improvement of corporate sustainability performance in its all particular dimensions brings about higher total revenues (TR) of a company. Methods: The main method of empirical research is panel regression models based on Cobb-Douglas production function, which has been extended to include variables of corporate sustainability scores. The selection between pooled OLS model, random-effects model and fixed-effects model has been made with the use of the F test, the Breusch-Pagan test and the Hausman test. Additionally, descriptive statistics and the Pearson correlation coefficients have been analyzed. The empirical studies were conducted in the period 2014-2019 among the 59 largest U.S. companies listed in the Fortune 500 ranking between 2015-2020. Findings & value added: The research hypothesis assuming the existence of positive relationship between corporate sustainability performance (CSP) at both aggregate and disaggregate levels and corporate financial performance (CFP) expressed by TR cannot be positively verified. It means that the improvement of corporate sustainability performance in environmental, social and governance dimensions does not lead to an increase in TR of a company, as some empirical studies suggest. |
| http://economic-research.pl/Journals/index.php/eq/article/download/1931/1823 |
Similar Articles
| ID | Score | Article |
|---|---|---|
71440
|
Poursoleyman, E; Mansourfar, G; Homayoun, S; Rezaee, Z Business sustainability performance and corporate financial performance: the mediating role of optimal investment(2022)Managerial Finance, 48.0, 2 | |
| 67489
|
Yilmaz, I Sustainability and financial performance relationship: international evidence(2021)World Journal Of Entrepreneurship Management And Sustainable Development, 17, 3 | |
| 66579
|
Jung, S; Nam, C; Yang, DH; Kim, S Does Corporate Sustainability Performance Increase Corporate Financial Performance? Focusing on the Information and Communication Technology Industry in Korea(2018)Sustainable Development, 26, 3 | |
| 77286
|
Bodhanwala, S; Bodhanwala, R Does corporate sustainability impact firm profitability? Evidence from India(2018)Management Decision, 56, 8 | |
| 70528
|
Chang, DS; Kuo, LCR The Effects of Sustainable Development on Firms' Financial Performance - an Empirical Approach(2008)Sustainable Development, 16, 6 | |
| 74711
|
Naseer, MM; Hunjra, AI; Mattoussi, F; Amin, MN Unlocking the effect of corporate environmental practices in driving firms' financial performance(2023) | |
| 70995
|
Paunica, M; Opris, VN; Opris, ME; Tanase, GL Financial performance improvement through sustainable development(2017) | |
| 73625
|
Gupta, AK; Gupta, N Effect of corporate environmental sustainability on dimensions of firm performance - Towards sustainable development: Evidence from India(2020) | |
| 66289
|
Jyoti, G; Khanna, A How does sustainability performance affect firms' market performance? An empirical investigation in the Indian context(2024)Environment Development And Sustainability, 26, 8 | |
| 74076
|
Lee, YM; Hu, JL Integrated Approaches for Business Sustainability: The Perspective of Corporate Social Responsibility(2018)Sustainability, 10, 7 |