The impact of sustainability practices on companies' financial performance and value creation

Companies, markets, governments, and society in general have shown a growing interest in sustainability topics. However, the economic viability of these practices by companies is still controversial. Some studies confirm its positive impact on companies' financial performance and value. Others...

Full description

Saved in:
Bibliographic Details
Published in:Revista de contabilidade e organizações 2024-01, Vol.18, p.1-12
Main Authors: Lima, Wallace, Jucá, Michele Nascimento
Format: Article
Language:English
Subjects:
Developing countries
Financial performance
Industrialized nations
LDCs
Sustainability
Value creation
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Companies, markets, governments, and society in general have shown a growing interest in sustainability topics. However, the economic viability of these practices by companies is still controversial. Some studies confirm its positive impact on companies' financial performance and value. Others highlight the high costs of its implementation, without a compensatory benefit. Furthermore, the level of countries' development has a moderating effect on the adoption of these practices by organizations. Therefore, this study aims to evaluate the impact of sustainable practices on the financial performance and value creation of companies, considering the moderating effect of the countries' level of development. We analyzed, 355,416 observations from 2,509 companies located in 4 developed countries and 5 key partners of the Organisation for Economic Cooperation and Development. The data was obtained from the Bloomberg, Capital IQ, and World Bank databases for the period from 2010 to 2022. The verification of these objectives was carried out via a hierarchical linear model or multilevel regression with panel data. As a result, there is confirmation of the positive impact of sustainable practices in adding value and improving the financial performance of organizations, especially for those located in emerging countries.
ISSN:1982-6486
DOI:10.11606/issn.1982-6486.rco.2024.220597