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The impact of sustainability practices on financial performance: empirical evidence from Sweden

Author

Listed:
  • Duc Cuong Pham
  • Thi Ngoc Anh Do
  • Thanh Nga Doan
  • Thi Xuan Hong Nguyen
  • Thi Kim Yen Pham

Abstract

This study aims at empirically exploring the influence of sustainability practices on the finan cial performance of 116 listed Swedish companies in the year 2019. The research findings indicate a positive relationship between corporate sustainability and financial performance that is measured by earnings yield, return on asset, return on equity and return on capital employed. However, when it comes to a market-based financial measure, Tobin’s Q, the result is inconclusive. Finally, to improve financial performance, firms are recommended to e ngaging in Dow Jones Sustainability Index, prepare their sustainability report in accordance with Global Reporting Initiative (GRI) Standards, improve their sustainable growth rate, as well as keep a high position in the corporate social responsibility ranking.

Suggested Citation

  • Duc Cuong Pham & Thi Ngoc Anh Do & Thanh Nga Doan & Thi Xuan Hong Nguyen & Thi Kim Yen Pham, 2021. "The impact of sustainability practices on financial performance: empirical evidence from Sweden," Cogent Business & Management, Taylor & Francis Journals, vol. 8(1), pages 1912526-191, January.
    • Handle: RePEc:taf:oabmxx:v:8:y:2021:i:1:p:1912526
    DOI: 10.1080/23311975.2021.1912526
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    Citations

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    Cited by:

    1. Madriaga, Zyreen Camill T & Felix, Jerry G. & Liasos, Ronaline B. & Acar, Mae Angela M. & Agacer, Kenneth Paolo B. & Adducul, Sheryl A., 2024. "Sustainability Practices and Financial Performance of Coffee Producers in Nueva Vizcaya," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(2), pages 2363-2388, February.
    2. Sadia Rashid & Kanwal Iqbal Khan & Adeel Nasir & Tayyiba Rashid, 2022. "Unveiling living dead: characteristics and consequences of zombie firms," Cogent Business & Management, Taylor & Francis Journals, vol. 9(1), pages 2121240-212, December.
    3. Zaheer Alam & Yasir Bin Tariq, 2023. "Corporate Sustainability Performance Evaluation and Firm Financial Performance: Evidence from Pakistan," SAGE Open, , vol. 13(3), pages 21582440231, July.
    4. Osorio Iris Maria Velez, 2024. "Exploring the Link between Sustainable Practices and Corporate Performance Across Industries," Business Systems Research, Sciendo, vol. 15(1), pages 158-177.
    5. Sanoran, Kanyarat (Lek), 2023. "Corporate sustainability and sustainable growth: The role of industry sensitivity," Finance Research Letters, Elsevier, vol. 53(C).
    6. Phemelo Tamasiga & Helen Onyeaka & Malebogo Bakwena & El houssin Ouassou, 2024. "Beyond compliance: evaluating the role of environmental, social and governance disclosures in enhancing firm value and performance," SN Business & Economics, Springer, vol. 4(10), pages 1-38, October.
    7. Gaurav Jyoti & Ashu Khanna, 2024. "How does sustainability performance affect firms' market performance? An empirical investigation in the Indian context," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(8), pages 20457-20483, August.

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