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Sustainability 2018, 10(3), 649; https://doi.org/10.3390/su10030649

Comparison of Sustainable Environmental, Social, and Corporate Governance Value Added Models for Investors Decision Making

Department of Economics, Faculty of Business and Management, Brno University of Technology, Kolejní 4, Brno 61200, Czech Republic
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Received: 11 January 2018 / Revised: 24 February 2018 / Accepted: 27 February 2018 / Published: 28 February 2018
(This article belongs to the Section Economic, Business and Management Aspects of Sustainability)
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Abstract

The Sustainable Value-Added Model is a new approach in value-oriented strategic management that focuses on maximizing the value that is created by non-financial sustainability indicators. The objective of this paper is to refine the calculation of sustainable added value by incorporating environmental, social, and corporate governance sustainability indicators, assigning weights to the indicators and, by alternative methods, assigning target values to the indicators. Ten alternative models of Sustainable Environmental, Social, and Corporate Governance Value Added were created. The models encompass 11 environmental, social, and corporate governance indicators of sustainability, and two economic indicators (Earnings before Interest, Taxes, Depreciation and Amortization, and Value Added). Indicator values are related to the target values that represent the opportunity costs. The quality of the models was assessed by statistical methods, i.e., the Receiver Operating Characteristic curve, Gini index, and Kolmogorov-Smirnov statistic. The results of these statistics show sufficient quality of all the models proposed. The most accurate model is that with the economic indicator Value Added and target values that are based on the values of the company with the best economic results. View Full-Text
Keywords: corporate sustainability; sustainable value added; ESG indicators; non-financial indicators; benchmarking; Data Envelopment Analysis corporate sustainability; sustainable value added; ESG indicators; non-financial indicators; benchmarking; Data Envelopment Analysis
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Pavláková Dočekalová, M.; Kocmanová, A. Comparison of Sustainable Environmental, Social, and Corporate Governance Value Added Models for Investors Decision Making. Sustainability 2018, 10, 649.

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