Does Sustainability Orientation Drive Financial Success in a Non-Ergodic World? A Systematic Literature Review

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

The main research question is to study the concept of sustainable orientation and identify the relationship between it and financial performance. This is a noteworthy topic, and the results of the study highlight a number of issues that require further investigation. However, the study is theoretical in nature, which is not necessarily a drawback, but does limit the scope of the research.
The conclusions are consistent with the evidence and arguments presented and address the main research question. The references are appropriate.
A number of comments should be noted:
1.    I would recommend modifying Table 1 by categorising all definitions and highlighting common characteristics.
2. The authors do not provide sufficient explanation of the differences in the non-ergodic world. In this regard, the meaning of Figure 3 is not quite clear.

Author Response

Dear Reviewer,

Thank you for taking the time to review our research and for your positive overall assessment. We aim to improve the quality of our research, and we appreciate your valuable advice. You will find the answers to your questions and suggestions below.:

1. Feedback: I would recommend modifying Table 1 by categorising all definitions and highlighting common characteristics.
   Comment from the authors: Thank you for this insightful suggestion. As recommended, we have categorised the definitions of sustainability orientation in Table 1 and highlighted common characteristics using a structured format: bold for SD dimensions, italics for capabilities, resources, and competitive advantage, and underlined for resilience. In addition, we have fully revised the associated discussion (lines 212–241) to reflect this categorisation and deepen the theoretical interpretation. Furthermore, we have expanded this section by integrating Resource-Based Theory, Institutional Theory, and Stakeholder Theory into the discussion to strengthen the theoretical foundation and alignment with our research objectives. Please kindly refer to the highlighted sections of the article for more information.
2. Feedback: The authors do not provide sufficient explanation of the differences in the non-ergodic world. In this regard, the meaning of Figure 3 is not quite clear.
   Comment from the authors: We appreciate your comment on clarifying the concept of the non-ergodic world and the role of Figure 3. As suggested, we have supplemented our sustainability orientation definition with threats and added two new paragraphs (lines 376–403) explaining the core differences between ergodic and non-ergodic worlds to address this. Specifically, we discuss the differences in the non-ergodic world, where the inside-out and outside-in impacts do not follow past trends, creating further uncertainty and shifting the equilibrium even further. These changes aim to provide a smoother narrative flow and a clearer illustration of the integrative view of sustainability orientation in a non-ergodic world presented in Figure 3. Please kindly refer to the highlighted sections of the article for more information.

Sincerely,

Authors of this manuscript

Reviewer 2 Report

Comments and Suggestions for Authors

Figure 1 includes steps starting from the beginning that exclude papers that are discarded for review. I have doubts about the numbers: it is not clear how it goes from 2082 to 1107 if the discarded papers at step 2 were 1048 and how it goes from 1107 to 387 if the discarded papers at step 3 were 620. The authors should review these numbers well to see if there are only reporting errors or if some studies were discarded from the analysis erroneously. In the latter case, the analysis needs to be redone on the actual analyzable articles (potentially more than 117). Furthermore, it is not clear how the numbers reported in Figure 1 can be directly linked to those reported in the Appendix.

In the choice of filters on Scopus and WoS, it is not clear whether unpublished works (e.g., working papers), theses, and books were excluded. In addition, in some cases a filter based on the “quality” of the journals related, for example, to the presence of the journals on certain lists (e.g., FT50) or a level recognized by the academic community (e.g., ABS stars over a certain threshold) is also included. I believe the authors did not introduce this filter, but it would be useful to specify it and give a reason for it.

It is not clear from Figure 2 why 17 is precisely the number of topics beyond which there is a reduction in perplexity index improvement. The authors should explain this better and highlight it more clearly in the graph (e.g., zooming around point 17 on the x-axis if necessary).

It is not clear how the authors from the 17 topics synthesize the results into 5 macro-themes. This clustering should be explained both in methodology (what criteria did the authors materially adopt to precisely arrive at the identification of these 5 macro-themes) and in content, already at the beginning of section 5.

The authors consider three theories (Resource-Based, Institutional and Stakeholder) to structure the concept of SO, but there are some others that are not considered, such as the ecocentric theory (see, e.g., Washington et al., 2017) and the ability-motivation-opportunity theory (see, e.g., Sibian and Ispan, 2021). How did the authors identify the three they considered? It needs to be well explained, and more importantly, other, perhaps minority, theories need to be mentioned and why they were excluded from the model.

From reading the paper, it appears that the topic “financial performance” emerges from the literature review as a topic related to sustainability (topic 5). It is therefore unclear in what sense the authors then analyze an “exogenous” relationship between the concept of SO and financial performance, if financial performance itself is a pillar of the SO concept. Perhaps the interpretation could be modified, trying to figure out of the 5 (or 17) pillars which one contributes the most to the definition of SO.

References:

Sibian, A. R., & Ispas, A. (2021). An approach to applying the ability-motivation-opportunity theory to identify the driving factors of green employee behavior in the hotel industry. Sustainability, 13(9), 4659.

Author Response

Dear Reviewer,

We are grateful for your time in reviewing our research and providing feedback. We aim to improve the quality of our research, and your suggestions are a valuable source of guidance in this regard. You will find the answers to your questions and suggestions below:

1. Feedback: Figure 1 includes steps starting from the beginning that exclude papers that are discarded for review. I have doubts about the numbers: it is not clear how it goes from 2082 to 1107 if the discarded papers at step 2 were 1048 and how it goes from 1107 to 387 if the discarded papers at step 3 were 620. The authors should review these numbers well to see if there are only reporting errors or if some studies were discarded from the analysis erroneously. In the latter case, the analysis needs to be redone on the actual analyzable articles (potentially more than 117).
   Comment from the authors: Thank you for your suggestion. As suggested, we reviewed these numbers and identified an inconsistency in Appendix A and in Figure 1, which led to confusion. The correct number of articles before full-text retrieval was 186 (not 121, as initially reported). Following title and abstract screening, we had 190 articles, four of which could not be retrieved in full text. Furthermore, records excluded due to focus on specific criteria should have also included Stage 6 of Appendix A. We have corrected these errors and clarified the entire process by dividing Section 3 (Materials and Methods) into two subsections, thoroughly revising the systematic literature review subsection (lines 113–118; 121–159), and improving the Abstract (lines 8–30) according to PRISMA 2020 guidelines. Please kindly refer to the highlighted sections of the article for more information.
2. Feedback: Furthermore, it is not clear how the numbers reported in Figure 1 can be directly linked to those reported in the Appendix.
   Comment from the authors: Thank you for pointing this out. As recommended, we have revised the PRISMA flowchart (Figure 1) to align the stages of the SLR process shown in Appendix A. Please kindly refer to the highlighted sections of the article for more information.
3. Feedback: In the choice of filters on Scopus and WoS, it is not clear whether unpublished works (e.g., working papers), theses, and books were excluded.
   Comment from the authors: We appreciate your suggestion. As recommended, we have included two paragraphs in the Materials and Methods section (lines 130–149) that explain our inclusion and exclusion criteria. Specifically, we clarify that we excluded non-peer-reviewed articles, including working papers, theses, and books, to focus on peer-reviewed journal articles in the final publication stage. Furthermore, to clarify the contents of our systematic literature review, we have introduced and discussed a key statistics table in Section 5 (Table 4; lines 416-432). In this context, to further enhance the clarity of our study, we have revised the last paragraph of Section 1 to provide more precise guidance for readers of the upcoming sections of our manuscript (lines 98-108). Please kindly refer to the highlighted sections of the article for more information.
4. Feedback: In addition, in some cases a filter based on the “quality” of the journals related, for example, to the presence of the journals on certain lists (e.g., FT50) or a level recognized by the academic community (e.g., ABS stars over a certain threshold) is also included. I believe the authors did not introduce this filter, but it would be useful to specify it and give a reason for it.
   Comment from the authors: Thank you for this suggestion. As recommended, we have added a justification (lines 141–149) for not applying quality-based filters such as FT50 or ABS rankings. We aimed to provide a broad overview of peer-reviewed literature available in open access across disciplines without limiting our analysis to top-tier journals. We have also updated the limitations section (lines 764–769) to reflect this more comprehensively. Please kindly refer to the highlighted sections of the article for more information.
5. Feedback: It is not clear from Figure 2 why 17 is precisely the number of topics beyond which there is a reduction in perplexity index improvement. The authors should explain this better and highlight it more clearly in the graph (e.g., zooming around point 17 on the x-axis if necessary).
   Comment from the authors: Thank you for this observation. As suggested, we have added explanatory text (lines 186–195) detailing the rationale behind selecting 17 topics. Furthermore, we have updated Figure 2 by including a dashed line at the 17-topic threshold and a zoomed-in view around that point to highlight where improvements in perplexity diminish. Please kindly refer to the highlighted sections of the article for more information.
6. Feedback: It is not clear how the authors from the 17 topics synthesize the results into 5 macro-themes. This clustering should be explained both in methodology (what criteria did the authors materially adopt to precisely arrive at the identification of these 5 macro-themes) and in content, already at the beginning of section 5.
   Comment from the authors: We appreciate this suggestion. As suggested, we have clarified our manual categorisation approach for the 17 LDA topics into five thematic categories (lines 200–203). These categories are based on semantic similarity and manual alignment with the SD dimensions, as well as with the concepts of sustainability orientation or financial performance. We have ensured this explanation appears in Section 3 (Materials and Methods) before discussing our results in Section 5 to guide the reader more clearly through our thematic analysis. Please kindly refer to the highlighted sections of the article for more information.
7. Feedback: The authors consider three theories (Resource-Based, Institutional and Stakeholder) to structure the concept of SO, but there are some others that are not considered, such as the ecocentric theory (see, e.g., Washington et al., 2017) and the ability-motivation-opportunity theory (see, e.g., Sibian and Ispan, 2021). How did the authors identify the three they considered? It needs to be well explained, and more importantly, other, perhaps minority, theories need to be mentioned and why they were excluded from the model.
   Comment from the authors: Thank you for highlighting this. As suggested, we have introduced Table 2, which summarises the most commonly applied theories across sustainability orientation and financial performance research. Based on this table, we introduced the related paragraph (lines 264–279) to justify our decision to focus on Resource-Based Theory, Institutional Theory and Stakeholder Theory as the three most widely applied theoretical lenses, which were not considered together in the reviewed studies. By providing this information, we also acknowledge other potentially relevant theories and their exclusion in Subsection 7.2 (Limitations) (lines 772–776). Please kindly refer to the highlighted sections of the article for more information.
8. Feedback: From reading the paper, it appears that the topic “financial performance” emerges from the literature review as a topic related to sustainability (topic 5). It is therefore unclear in what sense the authors then analyze an “exogenous” relationship between the concept of SO and financial performance, if financial performance itself is a pillar of the SO concept. Perhaps the interpretation could be modified, trying to figure out of the 5 (or 17) pillars which one contributes the most to the definition of SO.
   Comment from the authors: Thank you for your thoughtful and valuable suggestion. To clarify this, we have added a justification (lines 451–463) explaining why financial performance should not be treated as a direct synonym for the economic dimension of sustainable development. Furthermore, we appreciate your observation regarding the relationship between sustainability orientation and financial performance, and the proposal to identify which of the 5 categories or 17 topics contributes most significantly to the conceptualisation of sustainability orientation is indeed insightful. While we agree that this would represent an intriguing addition to the research, we need to consider the already substantial word count of the manuscript and the need to maintain focus within the current scope. Therefore, we believe that it would add more value to explore this question in detail in our next study. Please kindly refer to the highlighted sections of the article for more information.

Sincerely,

Authors of this manuscript

Reviewer 3 Report

Comments and Suggestions for Authors

The manuscript titled "Does sustainability orientation drive financial success in a non-ergodic world? A systematic literature review" presents a timely and well-structured analysis of the relationship between sustainability orientation (SO) and financial performance (FP), particularly in an uncertain global context. The integration of Resource-Based, Institutional, and Stakeholder theories provides a robust theoretical foundation, and the use of systematic literature review (SLR) along with topic modelling (LDA) adds methodological rigor to the paper. The propositions outlined are insightful and the manuscript demonstrates a high level of scholarly depth.

The author may consider the following comments for further improvement:

1. Novelty and Contribution Clarification:
• While the introduction sets the context well, the novelty of the study is not clearly articulated. The authors should explicitly highlight what distinguishes this review from earlier works in the field, especially given the existence of numerous SLRs on sustainability and firm performance.
• The contribution of the study should be clearly outlined towards the end of the introduction section, specifying what new knowledge it brings to the literature on SO and FP in a non-ergodic world.
2. Theoretical Framing:
• The manuscript presents a strong theoretical integration of RBT, IT, and ST, which is commendable. This section is well written and reflects a deep understanding of the relevant frameworks.
3. Methodology:
• The methodology section, particularly the use of PRISMA and LDA, is clearly described and appropriate for the research objectives. The use of topic modelling to complement the SLR is a notable strength.
4. Literature on Sustainability–FP Linkage:
   • Buallay, A. (2020), "Sustainability reporting and firm’s performance: Comparative study between manufacturing and banking sectors", International Journal of Productivity and Performance Management, Vol. 69 No. 3, pp. 431-445. https://doi.org/10.1108/IJPPM-10-2018-0371.
   •  
   • Dincer, B.; Keskin, A.İ.; Dincer, C. Nexus between Sustainability Reporting and Firm Performance: Considering Industry Groups, Accounting, and Market Measures. Sustainability 2023, 15, 5849. https://doi.org/10.3390/su15075849
   • Bansal, M., Samad, T.A. and Bashir, H.A. (2021), "The sustainability reporting-firm performance nexus: evidence from a threshold model", Journal of Global Responsibility, Vol. 12 No. 4, pp. 491-512. https://doi.org/10.1108/JGR-05-2021-0049.
   • Laskar, N. (2018), "Impact of corporate sustainability reporting on firm performance: an empirical examination in Asia", Journal of Asia Business Studies, Vol. 12 No. 4, pp. 571-593. https://doi.org/10.1108/JABS-11-2016-0157.
• While the paper presents a general summary of literature on SO and FP, some important and relevant studies are missing, which could enhance the review’s comprehensiveness. The authors are encouraged to include and discuss the following studies:

Including these works would help better articulate the complex nature of the sustainability–FP nexus, especially in emerging economies.

1. Implications Section:
• A dedicated section on implications for various stakeholders is currently missing. It is recommended that the authors add a section that clearly outlines the practical implications of their findings for corporates, policymakers, investors, and academia, rather than addressing only corporate actors implicitly.
2. Theoretical Propositions:
• While most propositions are well-articulated, Proposition 2, for instance, is already extensively addressed in the extant literature. The authors are encouraged to propose a more novel and unique proposition that can advance theory in the field of corporate sustainability.
3. Corporate Governance Dimension:
• One key dimension that is not sufficiently addressed is the role of corporate governance in moderating the SO–FP relationship. Given the increasing attention to governance mechanisms in sustainability literature, the authors should consider integrating this aspect, either in the discussion or as part of the future research agenda.

 

Author Response

Dear Reviewer,

Thank you for your positive feedback and for taking the time to review our research. We are committed to improving the quality of our research, and your feedback has helped us do so. You will find the answers to your questions and suggestions below:

1. Feedback: While the introduction sets the context well, the novelty of the study is not clearly articulated. The authors should explicitly highlight what distinguishes this review from earlier works in the field, especially given the existence of numerous SLRs on sustainability and firm performance.
   Comment from the authors: Thank you for this valuable suggestion. As suggested, we have revised the introduction to articulate our manuscript's novelty and distinct contributions. We added a paragraph highlighting our approach's unique aspects (lines 86–97), including focusing on sustainability orientation and financial performance in a non-ergodic world, integrating Resource-Based, Institutional and Stakeholder Theories, and conducting topic modelling with LDA. We also differentiate our study from prior research by explaining how our research scope (sustainability orientation and financial performance) differs from topics like sustainability reporting, policy analysis, bibliometric analysis, etc. To further articulate our study's novelty, we added key statistical results of the reviewed studies under the systematic literature review (lines 67-71). Please kindly refer to the highlighted sections of the article for more information.
2. Feedback: The contribution of the study should be clearly outlined towards the end of the introduction section, specifying what new knowledge it brings to the literature on SO and FP in a non-ergodic world.
   Comment from the authors: Thank you for emphasising this. As suggested, we have incorporated a dedicated paragraph (lines 86–97) summarising our study's contributions and novel insights. In this paragraph, we have also mentioned one of the four proposed articles (Dincer et al., 2023) and further clarified how our article differs from the existing studies. In addition, we added a second contribution paragraph in Section 7 (lines 739–745), thus reinforcing the added value our findings bring to the existing academic literature. To further strengthen contributions of our study, we have revised the last paragraph of Section 1 to provide more precise guidance for readers of the upcoming sections of our manuscript (lines 98-108). Please kindly refer to the highlighted sections of the article for more information.
3. Feedback: Literature on Sustainability–FP Linkage. While the paper presents a general summary of literature on SO and FP, some important and relevant studies are missing, which could enhance the review’s comprehensiveness. The authors are encouraged to include and discuss the following studies:
1. Buallay, A. (2020), "Sustainability reporting and firm’s performance: Comparative study between manufacturing and banking sectors", International Journal of Productivity and Performance Management, Vol. 69 No. 3, pp. 431-445. https://doi.org/10.1108/IJPPM-10-2018-0371.
2. Dincer, B.; Keskin, A.İ.; Dincer, C. Nexus between Sustainability Reporting and Firm Performance: Considering Industry Groups, Accounting, and Market Measures. Sustainability 2023, 15, 5849. https://doi.org/10.3390/su15075849
3. Bansal, M., Samad, T.A. and Bashir, H.A. (2021), "The sustainability reporting-firm performance nexus: evidence from a threshold model", Journal of Global Responsibility, Vol. 12 No. 4, pp. 491-512. https://doi.org/10.1108/JGR-05-2021-0049.
4. Laskar, N. (2018), "Impact of corporate sustainability reporting on firm performance: an empirical examination in Asia", Journal of Asia Business Studies, Vol. 12 No. 4, pp. 571-593. https://doi.org/10.1108/JABS-11-2016-0157.
   Including these works would help better articulate the complex nature of the sustainability–FP nexus, especially in emerging economies.
   Comment from the authors: Thank you for your valuable suggestion. As suggested, we have added a reference to Dincer et al. (2023) and clarified how our study differs from previous research focused on different themes or methods (lines 86–97). However, the suggested references pertained to sustainability reporting rather than sustainability orientation. Additionally, those references were unfortunately not available for open access. Therefore, since we also aimed to minimise the potential increase in word count, we decided not to include the remaining three references in this study. However, we thank the reviewer for providing this valuable information, which can be applied in our next studies. Please kindly refer to the highlighted sections of the article for more information.
4. Feedback: Implications Section: A dedicated section on implications for various stakeholders is currently missing. It is recommended that the authors add a section that clearly outlines the practical implications of their findings for corporates, policymakers, investors, and academia, rather than addressing only corporate actors implicitly.
   Comment from the authors: Thank you for highlighting this. As recommended, we have significantly revised and enhanced Section 7 (Conclusion) (lines 730-732; 739-751) and divided it into four dedicated subsections: Conclusion, Limitations, Implications, and Future Research Areas. Furthermore, the Implication section was divided into theoretical, practical, and policy implications (lines 779–797). Please kindly refer to the highlighted sections of the article for more information.
5. Feedback: Theoretical Propositions: While most propositions are well-articulated, Proposition 2, for instance, is already extensively addressed in the extant literature. The authors are encouraged to propose a more novel and unique proposition that can advance theory in the field of corporate sustainability.
   Comment from the authors: We appreciate this constructive suggestion. As recommended, we have revised Proposition 2 (lines 553–556) to introduce a more novel angle by focusing on green policy and commitment reversals amid the escalating environmental crisis. We also made targeted adjustments to Proposition 3 (lines 574–576) to incorporate DEI (diversity, equity and inclusion) dynamics and growing geopolitical tensions. Similarly, Proposition 4 (lines 596–597) has been updated to include the evolving global geopolitical and trade war environment. Furthermore, we have added actions recently undertaken by the US to justify adjusting our theoretical propositions (lines 337-338). Please kindly refer to the highlighted sections of the article for more information.
6. Feedback: Corporate Governance Dimension: One key dimension that is not sufficiently addressed is the role of corporate governance in moderating the SO–FP relationship. Given the increasing attention to governance mechanisms in sustainability literature, the authors should consider integrating this aspect, either in the discussion or as part of the future research agenda.
   Comment from the authors: Thank you for this important point. We have added a future research question in Table 7 to explicitly address the potential moderating role of corporate governance in the SO–FP relationship. This addition enhances the future research directions and strengthens the link between corporate governance and sustainability orientation outcomes. Please kindly refer to the highlighted sections of the article for more information.

Sincerely,

Authors of this manuscript

Round 2

Reviewer 2 Report

Comments and Suggestions for Authors

I would like to thank the Authors for incorporating most of my suggestions in the revised manuscript. I have only three minor comments / suggestions for their consideration.

Minor Comments:

1. It is unusual to include acknowledgments or references to grants within the abstract. I suggest the Authors move this information to a footnote instead.

2. In Table 1, I recommend justifying the text alignment in the “Definition” column to improve readability. The same applies to the relevant columns in Tables 5, 6, and 7.

3. Regarding my previous comment no. 8: while I understand that the Authors face constraints in addressing this topic within the current article and plan to explore it further in future work, I recommend including a brief reference to this topic in the “Future Research Areas” section.

Good luck with this paper!

Author Response

Dear Reviewer,

Thank you for your positive feedback and for taking the time to review our research. We are committed to improving the quality of our research, and your feedback has helped us do so. You will find the answers to your questions and suggestions below:

1. Feedback: It is unusual to include acknowledgements or references to grants within the abstract. I suggest the Authors move this information to a footnote instead.
   Comment from the authors: Thank you for your suggestion. Initially, acknowledgements were included following PRISMA 2020 guidelines for abstracts, which suggest disclosure of funding sources in the abstract. However, we acknowledge this as an unusual placement. Therefore, as suggested, we moved this information to a footnote for clarity (lines 31-32). Please kindly refer to the highlighted sections of the article for more information.
2. Feedback: In Table 1, I recommend justifying the text alignment in the “Definition” column to improve readability. The same applies to the relevant columns in Tables 5, 6, and 7.
   Comment from the authors: Thank you for this observation. As recommended, we justified the text alignment in all tables (Tables 1–7), as well as tables in Appendices A and B. Additionally, to include the latest development in our non-ergodic world, we included a reference to the rising geopolitical tensions in the Middle East in Section 4 (lines 253-255) to further enhance contextual relevance. Please kindly refer to the highlighted sections of the article for more information.
3. Feedback: Regarding my previous comment no. 8: while I understand that the Authors face constraints in addressing this topic within the current article and plan to explore it further in future work, I recommend including a brief reference to this topic in the “Future Research Areas” section.
   Comment from the authors: We appreciate this recommendation. As suggested, we included a brief reference to this topic within Section 7.3, noting the importance of exploring this further in future research. Please kindly refer to the highlighted sections of the article for more information.

Sincerely,

Authors of this manuscript