Sustainable Performance Evaluation: Evidence from Listed Chinese Mining Corporations

Rapid industrial development has caused a series of environmental problems, which is not conducive to sustainable development of society as a whole. It is necessary to build a sustainable development evaluation system. Most of the existing literature has evaluated corporate sustainable performance from the economy, environment and society on the basis of triple bottom lines. Considering the research gap and the practice need, an evaluation system is established from four dimensions, referred to as economy, society, environment and responsibility management, and 29 indicators are designed to measure these four dimensions. Twenty seven listed Chinese mining corporations are selected as research samples, and the entropy-weight-based Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) method is applied to calculate indicators’ weights. Results show that the four dimensions of sustainable performance weights from high to low are society, environment, economy, and management process.


Introduction
Due to the environmental degradation caused by industrial development, sustainable development (SD) has become a major concern for countries, firms and individuals [1]. Some scholars believe that firms are the only organizations that have resources, technology, and motivation to achieve sustainability, so firms have a greater potential contribution to SD of countries and regions [2]. Considering the urgency of SD and the potential influence of firms, scholars have linked firms with SD and proposed the concept of corporate sustainable performance (CSP), which is used to represent the status and level of corporate SD [3,4]. A reasonable indicator system should be established to evaluate CSP. The development of performance indicators is conducive to optimizing operations, connecting and weighing all aspects of SD [5], in order to guide firms to take specific management actions to improve corporate sustainability [6][7][8].
Scholars have generally established CSP evaluation indicators based on triple bottom lines [9]. The most recognized is the Global Reporting Initiative (GRI) framework [10][11][12]. It developed a corporate sustainable assessment framework to guide firms in the preparation of corporate sustainability reports on environmental, social and economic impacts [5] for the following categories: economic, environmental, financial, employee and workplace related, product related and social related [10][11][12]. However, the biggest disadvantage of the GRI framework is that indicators are basically prepared for external reporting, and their impact on the actual management process of sustainable performance is limited [5].
The existing research on CSP evaluation has achieved valuable results, yet several deficiencies still exist. First, most studies adopt triple bottom lines to analyze CSP, with the emphasis on economy, environment, and society, lacking a consideration of firms' management process [13][14][15][16]. International Standards Organization believes that natural environment may be influenced due to firms' operation, which calls for the implementation

Literature Review
The World Commission on Environment and Development first proposed the concept of SD in 1987, arguing that SD is the fulfillment of the needs of the present day without harming future generations in meeting their own needs [28]. With the advancement of times and academic exploration, the concept of SD is gradually extended into the process of corporate development. Scholars employ CSP to denote the outcomes of corporate sustainability. Moreover, corporate sustainable development and relating performance measures frequently consider economic, environmental, and social issues. While ensuring economic development and accountability to shareholders, firms also need to meet the needs of direct and indirect stakeholders (such as employees, customers, communities, etc.) [29].
The term Triple Bottom Lines was first coined by Elkington [30]. Some scholars believe that measuring CSP based on the triple bottom lines allows evaluating whether a firm meets the criteria for sustainability from three aspects of economy, environment and society [19,20]. On the basis of the triple bottom lines, the GRI, co-issued by the US non-profit environmental economic organization and the United Nations Environment Program, established a framework for CSR reporting. The GRI provides a reference for academia to measure CSP [10][11][12]. Drawing on the experience of GRI, Rankins Corporate Social Responsibility Ratings (RKS) has been issued by Chinese corporate responsibility third party rating agency since 2009.
Although GRI is widely recognized, scholars have not stopped their efforts to rebuild the sustainable performance evaluation framework for firms. Academia hopes to guide firms' SD more scientifically through more sample research. Lee and Saen [18] evaluate the inputs and outputs of Korean electronic manufacturing firms from 3 aspects, economic profitability, social responsibility, and environmental sustainability. Considering the impact of firm size on CSP, Cagno et al. [17] set up indicators for 3 different sizes of firms. Aras et al. [31] add corporate governance into the triple bottom lines to evaluate CSP. Specially, Tan et al. [1] establish an indicator framework using a systematic indicator selection method in order to facilitate the SD of small and medium sized firms in Singapore. Besides the triple bottom lines that are often mentioned in extant research, performance management is added in his framework, and 9 sub-indicators are identified. Although management indicator is included in Tan et al. [1], there are still lack of discussion and demonstration of indicator weight, which limits the guidance of the research conclusion to the SD of firms.

Corporate Sustainable Performance Index System
Based on the triple bottom lines [30], which aims to measure the economic, social, and environmental performance of a company over time, and considering the management process, the CSP evaluation index is constructed in terms of economic performance, environmental performance, social performance, and responsibility management.

Economic Performance
Economic performance reflects the value of firms' existence and is an important aspect of CSP, because profit can maintain firms' survival and support their development [9]. Under the context of SD, firms' economic sustainability should ensure long-term effective profitability of corporate financial capital [35], because economically stable firms can guarantee cash flow to meet capital liquidity at any time, and provide stakeholders with continuous returns above the average level [36], so as to ensure themselves keep on sustainability.
Firms' economic performance indicators are evaluated from three aspects: financial performance, solvency, and firm growth. Financial performance provides information on the return of firms' funds, solvency guarantees the safety of firms' assets, and firm growth is the source of SD.

Environmental Performance
Environmental performance relates to the impact of an organization on biological and non-biological natural systems, including ecosystems, land, air, and water. The GRI has revealed several indicators of environmental performance, such as materials, energy, water, biodiversity, emissions, and compliance [10,11]. Studies have also shown that environmental performance should disclose such aspects as environmental policy, organizational responsibility, training and awareness, monitoring and follow-up activities [37]. Relative evaluations of environmental performance have been conducted by different organizations and scholars, so that such evaluations can operate in various social, economic, and environmental contexts to serve different purposes [38]. Firms' environmental performance indicators are constructed of environmental initiatives, energy conservation, as well as pollution abatement and emission reduction.

Social Performance
Social performance is closely related to moral norms. Firms are responsible for producing and selling goods, as well as providing services to benefit from the whole society. Therefore, each firm is obliged to feedback the supports of community and stakeholders [39] to create value for the public and society affected by it [9]. Social performance usually focuses on issues related to internal business environment, such as human resource practices and employee health and safety [40], as well as issues related to stakeholders and the public in external business environment [41]. In addition, social performance also requires firms to comply with laws and regulations, concern human rights of employees, ensure product quality, and pay attention to regional philanthropy [9,39]. In summary, we argue that firms should be responsible for the laws, employees, products, and community, based on which, relevant indicators of social performance are proposed.

Responsibility Management
On the basis of the triple bottom line, the importance of management process to firms' sustainable performance is fully taken into consideration, therefore, the dimension of responsibility management is added to the sustainable performance evaluation. Responsibility management is employed to measure the formulation and adoption of management measures and weigh up the management performance in terms of firms' SD. This dimension mainly focuses on the efforts of firms in setting responsibility concept, establishing responsible organization, formulating responsibility strategy and promoting responsibility integration. Responsibility management is not easily monitored and is seldom involved in studies of sustainable performance measurement [42]. However, appropriate sustainable management measures play a vital role in obtaining favorable sustainable performance. As such, it is necessary to formulate and implement management measures that can ensure firms' performance level to realize sustainable goals [5]. It is indicated that management indicators are another pillar of traditional sustainability, which can be used to measure firms' management performance in SD [1]. Neugebauer, et al. [43] also believe that the severe SD pressure increases the necessity to develop SD management initiatives, which is conducive to promote and guide firms' sustainable practices. In addition, firms need to employ strategy development and rigorous management to meet stakeholders' requirements to achieve sustainable development. In summary, the index framework of this paper includes four dimensions and 29 indicators, and the specific indicators are shown in Table 1.

The Entropy-Weight-Based TOPSIS Method
The entropy-weight-based TOPSIS method is a modification of the traditional TOPSIS evaluation method, by first determining the weights of the evaluation indexes through the entropy weight method, and then determining the ranking of the evaluation objects through the TOPSIS method using approximate the ideal solution.
The entropy-weight method objectively determines the weight according to the information provided by each evaluation indicator to be entropy weight. It can objectively reflect the importance of a certain indicator in the indicator system and has strong fitness during weight determination [27].
TOPSIS is a multi-criteria decision method, developed by Hwang and Yoon [44]. Its core ideology is to calculate the distances between the evaluation objects and the best (worst) solutions, based on which, the relative closeness can be calculated, and each scheme can be ranked [31,45].

Calculating the Index Weights
The weights of each index are calculated by the entropy weight method, and the specific calculation steps are as follows: (1) Constructing original information matrix; (2) Standardized processing; R = r ij n×p is obtained by normalizing the X, in which i = 1, . . . , n; j = 1, . . . , p; r ij ∈ [0, 1]. In addition, different meanings are in the positive index and negative index values (the positive index value is the higher the better, but the reverse is negative index), thus heterogeneous algorithms for data standardization of positive and negative indexes are performed. The positive index: The negative index: The moderate index: (3) Calculating the proportion of evaluation object i under indicator j; (4) Calculating the entropy of the jth index; In which k = 1 ln n , and hypotheses when P ij = 0, P ij ln P ij = 0. (5) Calculating the entropy weight of the jth index

Constructing Evaluation Model
The specific steps of TOPSIS method are as follows: 1.
Construct weighted normalization matrix Z = (Z ij ) np according to the weight determined by Formula (6), in which is a standard normalized matrix based on Formula (7) 3.
Determine set Z + of positive ideal solutions and set Z − of negative ideal solutions Z + = maxZ ij |i = 1, 2, . . . , n

4.
Calculating Euclidean distance between evaluation objects and positive (negative) ideal solutions:

5.
Calculating comprehensive evaluation index of evaluation objects:

Sample Selection and Data Source
In this paper, we amassed data of listed mining corporations from corporate financial reports and corporate social responsibility reports published in 2018 and 2019 from the China Stock Market & Accounting Research (CSMAR) database, the web of giant tide and corporate official network. After removing firms with incomplete information, 27 corporations were left as the samples of this paper. The descriptive statistics of these indicators are depicted by Table A1 in Appendix A.

Calculation of Evaluation Index Value
According to the above indicator framework in Table 1, the entropy weight of indicators needs to be defined firstly. The indicators selected in this paper include several positive indicators, whose optimal solution is the maximum value and the worst solution is the minimum value, and vice versa if there are negative indicators. In addition, several moderate indexes are also selected, including return on investment, short-term solvency, long-term solvency, reasonable compensation, and the proportion of female executives.
Since the values of sustainable development concept, institutional sector and compliance system construction are 1, their entropy weights are 0.

Standardization and Determination of Entropy Weight
Due to the nonuniformity of measurement units of each index, standardized processing is indispensable before calculating the comprehensive index with the index data, that is, the heterogeneous indexes need to be homogenized first. The method in Formulas (1)-(3) is used in the standardized process based on the nature of index (positive index, negative index or moderate index). Following steps of the entropy weight method, the proportion of the ith evaluation object in the jth index, the entropy value of the jth index, and the entropy weight value of the jth index are calculated according to the formula. Then the index is sorted out according to the dimension it belongs to, and the entropy weight value of the comprehensive index is obtained. The specific calculation results are shown in Table 2. According to Table 2, excluding the indicators of sustainable development concept, institutional sector and compliance system construction, the weight difference of the remaining 26 indicators is not obvious, indicating minor differences in these indicators among selected firms, and almost the same individual impact degree for sustainable performance score. However, after sorting out and calculating the indicators according to the dimensions they belong to, it can be seen that the weights of environmental performance and social performance are significantly higher than the weights of responsibility management and economic performance, which are 34.1961% and 39.0993%, respectively, playing a vital role in corporate sustainable performance. The weight of economic performance is 19.5590%, moderately influencing corporate sustainable performance. While the weight of responsibility management is 7.1457%, contributing slightly to corporate sustainable performance.

Results of TOPSIS Comprehensive Evaluation
After calculating the weight of each indicator by the entropy weight method, the comprehensive evaluation of corporate sustainable performance is conducted by the TOPSIS method. The ranking results of sample analysis are shown in Table 3. The score of comprehensive evaluation value Ci obtained by TOPSIS method is distributed in the range of 0 to 1. The closer the score is to 1, the higher the CSP is, on the contrary, the closer the score is to 0, the worse the CSP is. It can be seen from Table 3 that the comprehensive evaluation values of the top five firms with sustainable performance are 0.5482, 0.4517, 0.4382, 0.4265 and 0.4050, respectively, indicating better sustainable performance. However, the bottom five firms' are 0.2748, 0.2619, 0.2578, 0.2510 and 0.2130, respectively, indicating poor sustainable performance, which calls for further improvement.
The evaluation value and ranking of the top five firms in terms of economic performance, environmental performance, social performance and responsibility management are listed in Table 4. It can be seen from Table 4 that a minor differentiation in economic performance exists among those four firms except for Jizhong Energy Group (000937) ranked the 18th, and a relatively separated distribution exists among those five firms in terms of environmental performance, ranking from the second to the 26th. Moreover, only Hainan Mining (601969) ranks poorly in terms of social performance. Additionally, although the five firms score near the top in responsibility management, there are large deviations in the evaluation results. Finally, according to the results of Table 4, it is indicated that the poor rankings in environmental performance and social performance of Hainan Mining (601969) and Shaanxi Coal Industry (601225) result in their lower comprehensive rankings in Table 3.

Result Discussion
Most studies have classified CSP into economic performance, environmental performance and social performance, and affirmed the significance of environmental and social performance in the process of corporate sustainable development [13,17]. This paper also gives positive comments about the environmental and social performance in CSP evaluation. However, after comparing and sorting the existing literature, the triple bottom lines is limited obviously in that it only considers the economy, environment and society so that inevitably lacks attention of corporate management process. In view of this limitation, the management performance indicator, referred to as responsibility management, is added to the evaluation system. Although the comprehensive evaluation value of responsible management is the lowest among the four dimensions, it also indicates to some extent that the corporate management process contributes to the CSP.
Although there is relatively mature sustainability evaluation institutions in China, such as RKS, the samples it uses are 800 constituent corporations that are listed in the capital market and lack of special attention to a certain industry. Considering the differences between industries in SD, we chose a single industry. Therefore, in terms of evaluation results, it is difficult to find comparable conclusions in existing studies. To further highlight the characteristics and significance of the results, we comparatively analyze the research of Aras et al. [31] which similarly explored the sustainable performance of Turkish banking sector based on triple bottom lines with the entropy-weight TOPSIS method. It divided CSP into four dimensions of economic performance, environmental performance, social performance and corporate governance, and indicated the entropy weight of economic performance is the highest, followed by environmental performance, social performance and corporate governance. While our research classifies CSP into four dimensions and the entropy weight of those four dimensions from high to low is social performance, environmental performance, economic performance and responsibility management. It is indicated that the degree of urgency in terms of economy, society and environment is different when facing the problem of sustainable development. For the mining industry, social performance related to safety and employee benefits and environmental problems caused by mining influence sustainable development much more compared with economic performance.
Listed mining corporations are selected as research samples. Their strong economic strength leads to minor differences in terms of economic performance, but a large difference exists in environmental performance and social performance, resulting in higher weight results. It is indicated that owing to China' s rapid economic growth over the past 20 years, some large firms have accumulated strong economic foundation, therefore, their competition for sustainable performance mainly focuses on social performance and environmental performance. The Chinese government has realized the necessity of SD. In the past decade, several norms on SD have been formulated and constantly improved and perfected. Furthermore, the concept of green development and sustainable development has been proposed in the 12th Five-Year Plan and the 13th Five-Year Plan. With increasingly improved awareness of protecting the environment and contributing to society and ever-growing concerns about the environment and society, Chinese firms have gradually realized that economic development is not the only purpose, but the ecological environment and social support are development foundations. Therefore, great efforts have been put into environment and society. Specifically, the high weight results of environmental and social performance in this paper are the evidence showing emphasis that firms paid to the environment and society.
In order to further analyze the comprehensive evaluation results of CSP and provide inspirations for other firms to improve their sustainable performance, this paper analyzes the social responsibility reports disclosed by these five firms in detail and tracks their public information. These firms have carried out comprehensive work in protecting the environment and contributing to society, for example, they have generally established an environmental management system, and have constantly tried to develop new production mode of energy conservation as well as adopted environmental protection measures to reduce pollution emissions. Taking China Molybdenum (603993) as an example, it updated the environmental policy applicable to the whole group, discussing various issues such as tailings management, closure plan and reclamation, biodiversity, energy, greenhouse gas emissions and air quality in February 2020. The mining areas operated by China Molybdenum have been equipped with mature environmental management system (EMS) and passed the ISO14001 certification. Specifically, China Molybdenum has formulated standards in tailings management with six key elements of governance, including (1) accountability, responsibility and ability, (2) planning and resource allocation, (3) risk management, (4) change management, (5) emergency preparation and response, (6) audit and verification. China Molybdenum also have endeavored to protect environmental and conserve resources. For example, it is committed to maximizing resources utilization, reducing waste generation, using circulating water in production, and continuously improving water saving technology, as well as protecting underground water, which helps saving much water resources. China Molybdenum has repeatedly changed its energy structure by using renewable energy while increasing input of new energy, in addition, strict control of pollutant emissions has been implemented to reduce the environmental impact of exhaust gas and waste emissions as far as possible. China Molybdenum has attracted a large number of professional talents, giving priority to employees' safe and health through regularly employee training and constantly improvement of safety measures, for example. In addition to the above, China Molybdenum has so far been concerned with social and community development, and strongly supported education. In 2019, it contributed about CHY 2.67 million to the education cause of Luanchuan County, and provided material assistance to students. Moreover, it provided animal husbandry training and assistance to 267 farmers from 14 local villages, and cumulatively contributed about CHY 60 million to the public housing project in Luanchuan county. For lack of space, the evaluation values and rankings of the bottom 5 firms do not be listed in detail. By further comparing their financial reports and corporate social responsibility reports, it is found that several problems do exist in these firms such as lower management level, inefficient environmental management, less implementation of environmental protection measures, aging and infrequent maintenance of environmental protection facilities, and less voluntary activities.

Conclusions
This paper proposes a new framework for sustainable performance evaluation considering the dimensions of economy, environment, society, and management. The entropyweight-based TOPSIS method is used to calculate the weight and listed Chinese mining firms are selected as samples for quantitative analysis. The four dimensions of sustainable performance with the weight from high to low are society, environment, economy and management.
The conclusions can provide several implications for both academia and practitioners. Theoretically, when studying corporate SD, scholars should not only focus on the triple bottom line and other results, but also take the management process into consideration. The existence of appropriate sustainable management measures to a certain extent determines whether firms can obtain good sustainable performance. Although the management process of SD is not easy to be monitored, it is necessary for academia to consider its role in the overall management of corporate sustainable development. The research on the management process of corporate sustainable development is to study sustainability at a higher corporate management hierarchy and guide the sustainability. Firms with SD concepts and appropriate SD management initiatives are more likely to achieve higher sustainability performance [5]. Therefore, the corporate management process or other relevant factors should be taken into account apart from the considerations of economy, environment and society when studying CSP, which is beneficial to improve corporate management process thus contribute to firms' SD.
This study also provides implications for corporate managers. Corporate managers should change the original concept only focusing on economic performance, because SD is an important manifestation of firms' future competitiveness. Efforts that should be put into the environment and society cannot be ignored, furthermore, firms should pay more attention to environmental and social performance while focusing on economic performance. Firms with poor sustainable performance can draw from those with good sustainable performance, such as constant adjustment of corporate SD management system, adoption of environmental-friendly supporting equipment in the process of product production, implementation of green innovation to reduce environmental pollution, care and protection of employee rights, and support of social public welfare. In addition, responsibility management also has a great contribution to improving CSP. Firms can establish a SD department to coordinate their SD management and promote their sustainability by means of carrying out SD training, enhancing the sustainable awareness of departments, and formulating reasonable management plans.
It is also worth reminding that our research has suffered from some limitations. First, fewer research samples are available because a relatively authoritative SD system has not been established, together with firms' unmatured awareness of undertaking social responsibility and varying disclosure quality of SD. Second, only a single industry is selected as the research sample in this paper, lacking a consideration of other industry characteristics. Therefore, research of SD of more industries is encouraged and more detailed explorations of CSP should be conducted in the future, including evaluation models, evaluation frameworks, and even the discovery of theoretical bases.