Leveraging stakeholder engagement for market value growth: Empirical evidence on sustainable development leadership in Europe

This study analyzes the impact of sustainable development leadership on firm performance. The context of the empirical analysis is the European region between 2010 and 2018. Sustainable development leaders are defined as the firms included in the Dow Jones Sustainability Index for Europe. To control...

Full description

Saved in:
Bibliographic Details
Published in:Sustainable development (Bradford, West Yorkshire, England) West Yorkshire, England), 2024-02, Vol.32 (1), p.336-347
Main Authors: Garcia‐Blandon, Josep, Argilés‐Bosch, Josep Maria, Ravenda, Diego
Format: Article
Language:English
Subjects:
Civil law
Common law
Comparative advantage
Competition
Competitive advantage
Corporate governance
Dow Jones Sustainability Index
Empirical analysis
firm performance
Impact analysis
Leadership
Market value
Organizational performance
Research design
Securities markets
Selection bias
stakeholder engagement
Stock exchanges
Sustainability
Sustainable development
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:This study analyzes the impact of sustainable development leadership on firm performance. The context of the empirical analysis is the European region between 2010 and 2018. Sustainable development leaders are defined as the firms included in the Dow Jones Sustainability Index for Europe. To control for endogeneity problems caused by self‐selection bias in the sample, the research design relies on Heckman two‐stage model. The results show that stock market participants do not perceive sustainability leadership as an asset that adds value to the firm. Our findings also suggest that corporate governance shapes the relationship between sustainable development leadership and performance as common‐law countries have a more positive perception sustainable development leadership than civil‐law countries. Additionally, the study reveals a decline in stock market sentiment toward sustainability leadership over the research period, indicating a potential loss of competitive advantage for sustainable development leaders as sustainability initiatives become more widespread.
ISSN:0968-0802
1099-1719
DOI:10.1002/sd.2662