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

• Main Authors: Duc Cuong Pham, Thi Ngoc Anh Do, Thanh Nga Doan, Thi Xuan Hong Nguyen, Thi Kim Yen Pham
• Format: Article
• Language: English
• Published: Taylor & Francis Group 2021-01-01
• Series: Cogent Business & Management
• Subjects: sustainability; sustainable development; green initiatives; financial performance
• Online Access: http://dx.doi.org/10.1080/23311975.2021.1912526

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.