Sustainability Matter and Financial Performance of Companies

By Carlos Lassala, Andreea Apetrei, J. Sapena. 2017

139 citations recorded by the source corpus.

The relationship between social and environmental performance and financial performance in companies has been a subject widely debated in the literature but the results obtained to date are not conclusive. This research employs the fuzzy-set qualitative comparative analysis (fsQCA) and offers new evidence on the relationship between both types of performance in a sample of companies listed in the Spanish capital market. Financial performance is measured by the return on equity (ROE) ratio, variable that is widely used in Finance and Accounting related research. The corporate performance of the company is measured by its inclusion or not in the sustainability index used as reference for the Spanish capital market, the FTSEGood4 IBEX. The model also incorporates other business variables that might affect the relationships between both types of performance, such as return on assets (ROA) ratio, company size, debt ratio, and industry. The results suggest that, for specific industries, return on assets is a necessary condition for companies with leverage to reduce the cost of debt due to their sustainability profile and consequently boost their ROE.

Subfields: Marketing, Organizational Behavior and Human Resource Management, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/9688a6eda1e99fe1b9e054ef201e8ebfeed21fa5

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Marketing

1. Binghan Wang
2. Jian Xu
3. J. Sapena

In Organizational Behavior and Human Resource Management

1. Binghan Wang
2. Jian Xu

In Strategy and Management

1. Jian Xu
2. Binghan Wang
3. Rafael Rivelles
4. J. Paniagua
5. J. Sapena
6. Feng Liu
7. Ngoc Phu Tran
8. Duc Hong Vo

Citations in the corpus

• Intellectual Capital, Financial Performance and Companies’ Sustainable Growth: Evidence from the Korean Manufacturing Industry (2018, methodology): “This provides evidence for H4, consistent with the findings of Smriti and Das [13] and Chen et al. [21] who stated that IC has a positive impact on revenue growth.”
• Corporate governance and financial performance: The role of ownership and board structure (2018, background): “It is also ideal for small to intermediate N research designs, particularly in economics and business (for recent applications, see Apetrei et al., 2016 ; Lassala et al., 2017).”