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Testing sustainable value added as an integrative measure of business sustainability

Author

Listed:
  • Dejan Miljenoviæ

    (University of Rijeka, Faculty of Economics, Ivana Filipoviæa 4, 51000 Rijeka, Croatia.)

Abstract

New analytical approaches used for a holistic/integral evaluation of the company created value advocate implementation of business models based on Corporate Social Responsibility (CSR) sand the Triple Bottom Line (TBL). Owing to the fact that CSR and TBL are strategically oriented on business objectives of sustainable development, especially in managing eco-efficiency, this type of value is being named – Sustainable Value Added (SVA). However, since previous research and constructive criticism of SVA models have not been adequately tested by applying the appropriate econometric models so far, in this paper author introduces applicable empirical testing of the SVA sensitivity on the Triple Bottom Line aspects: 1) financial, 2) environmental and 3) social business results. The aim of this paper is to conduct research on SVA as an integrative measure for quantitative assessment of company contributions to the long-term sustainable development. The author also advocates an important thesis regarding the extraction of the TBL data, implicating that this process validates only when a relevant number of companies, across different benchmarks, regularly publishes annual CSR reports. Such publishing ensures transparent and unified TBL data essential for SVA analysis. Research methodology rests on the comparison of SVA with a traditional economic measure of Value Added (VA) in terms of their contributions to business sustainability. Empirical testing indicates significant differences between the SVA and VA regarding their financial, environmental and social sustainability effects. Testing empirically confirms SVA as an integrative measure for sustainable business contributions. This ensures the presentation of complete and standardized data of triple results required for SVA analysis. Additional objective in this context was to investigate eco-efficiency of a specific benchmark as a sustainability precondition, measured by using the SVA.

Suggested Citation

  • Dejan Miljenoviæ, 2018. "Testing sustainable value added as an integrative measure of business sustainability," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 36(1), pages 103-128.
    • Handle: RePEc:rfe:zbefri:v:36:y:2018:i:1:p:155-181
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    References listed on IDEAS

    as
    1. Ehrmann, Markus, 2008. "Comparing Sustainable Value Approach, Data Envelopment Analysis and indicator approaches - An application on German dairy farms," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44140, European Association of Agricultural Economists.
    2. Amanda Ball & David L. Owen & Rob Gray, 2000. "External transparency or internal capture? The role of third‐party statements in adding value to corporate environmental reports1," Business Strategy and the Environment, Wiley Blackwell, vol. 9(1), pages 1-23, January.
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    More about this item

    Keywords

    corporate social responsibility; sustainable value added; triple bottom line; reporting; company; sustainability;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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