Premium
Corporate sustainability and stakeholder value trade‐offs in project selection through optimization modeling: Application of investment banking
Author(s) -
Kudratova Shamsiya,
Huang Xiaoxia,
Kudratov Khikmatullo,
Qudratov Shohrukh
Publication year - 2019
Publication title -
corporate social responsibility and environmental management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.519
H-Index - 73
eISSN - 1535-3966
pISSN - 1535-3958
DOI - 10.1002/csr.1846
Subject(s) - sustainability , stakeholder , net present value , return on investment , selection (genetic algorithm) , sustainable value , investment (military) , business , value (mathematics) , investment value , process (computing) , environmental economics , economics , computer science , microeconomics , finance , ecology , management , artificial intelligence , production (economics) , machine learning , politics , political science , law , biology , operating system , cash
This study presents a new optimization model for quantitative sustainability measurement in net present value estimation process of corporate investments. Proposed model presents an innovative perspective for the transformation of the logic behind traditional investment project selection practices to the sustainable project selection in corporations. By using the proposed model, it is possible that investors' can find positive sustainability trade‐offs without harming returns on investment. A case study is presented to illustrate the applicability of the proposed model in project selection decision‐making processes. Expected net present value is employed to calculate the return of the project investment for project selection decision‐stage. In order to identify stakeholder value trade‐off gaps, proposed model with sustainability involvement is evaluated in contrast to the traditional net value method estimations of the model. Based on optimization results, comparative analysis of proposed sustainability cost involvement in net present value estimation with traditional net present value estimation in project selection practices restore positive trade‐offs verifying the efficiency of proposed methodology.