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The determinants of corporate sustainability performance
Author(s) -
Artiach Tracy,
Lee Darren,
Nelson David,
Walker Julie
Publication year - 2010
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/j.1467-629x.2009.00315.x
Subject(s) - sustainability , incentive , leverage (statistics) , corporate sustainability , equity (law) , business , stakeholder , free cash flow , index (typography) , industrial organization , cash flow , accounting , economics , microeconomics , management , ecology , machine learning , world wide web , computer science , political science , law , biology
This paper investigates the factors that drive high levels of corporate sustainability performance ( CSP ), as proxied by membership of the Dow Jones Sustainability World Index. Using a stakeholder framework, we examine the incentives for US firms to invest in sustainability principles and develop a number of hypotheses that relate CSP to firm‐specific characteristics. Our results indicate that leading CSP firms are significantly larger, have higher levels of growth and a higher return on equity than conventional firms. Contrary to our predictions, leading CSP firms do not have greater free cash flows or lower leverage than other firms.