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The Impact of Sustainability Practices on the Going Concern of the Travel and Tourism Industry: Evidence from Developed and Developing Countries

Author

Listed:
  • Nagalingam Nagendrakumar

    (Business School, Sri Lanka Institute of Information Technology, New Kandy Rd., Malabe 10115, Sri Lanka)

  • Kalubowilage Navodya Nilupulee Alwis

    (Business School, Sri Lanka Institute of Information Technology, New Kandy Rd., Malabe 10115, Sri Lanka)

  • Udage Arachchige Kaveesha Eshani

    (Business School, Sri Lanka Institute of Information Technology, New Kandy Rd., Malabe 10115, Sri Lanka)

  • Seekku Baduge Ushani Kaushalya

    (Business School, Sri Lanka Institute of Information Technology, New Kandy Rd., Malabe 10115, Sri Lanka)

Abstract

Sustainability refers to the evaluation and communication of quantitative and qualitative information of the sustainability performance of a business in a balanced way regarding the environment and the society in which it operates. Companies are responsible for stakeholders’ justification and disclosure expenses consisting of dedicated sustainability practices, thereby strengthening the company’s financial performance. However, due to the deficiency of consistent information and a lack of transparency in corporate reporting, tourism industries fail to realize the association between sustainability practices and financial performance. Moreover, there is a lack of literature that deals with the impact of macro-level sustainability factors on firms’ financial performances. Furthermore, linking the going concern concept and sustainable practices with financial performance through the Z -score model is not frequently done in the corporate world. Hence, this paper investigated the impact of macro-level sustainability practices on the going concern ability in developed and developing countries’ tourism industries for the 2016–2020 period, including a sample size of 138 listed companies, through panel data analysis. This study fills the empirical gap by adopting the Altman Z -score to analyze the financial performance related to sustainability practices in terms of environmental, economic, and social dimensions. The empirical results reveal that macro-level sustainability practices significantly impact the going concern from developed and developing countries’ perspectives.

Suggested Citation

  • Nagalingam Nagendrakumar & Kalubowilage Navodya Nilupulee Alwis & Udage Arachchige Kaveesha Eshani & Seekku Baduge Ushani Kaushalya, 2022. "The Impact of Sustainability Practices on the Going Concern of the Travel and Tourism Industry: Evidence from Developed and Developing Countries," Sustainability, MDPI, vol. 14(24), pages 1-21, December.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:24:p:17046-:d:1008313
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    References listed on IDEAS

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    1. Paolo Galli & Eleonora Concari & Diana Cerini & Erika Scuderi & Federica Doni & Shazla Mohamed & M. Sami Zitouni & Hussain Al Ahmad & Alessandro Gabbiadini, 2025. "From Stars to Sustainability: An Integrated Analysis of Sustainable Practices and Environmental Policies in Maldives Resorts," Sustainability, MDPI, vol. 17(11), pages 1-25, June.
    2. Yi Lu, 2024. "RETRACTED ARTICLE: Transforming China’s Tourism Industry: The Impact of Industrial Integration on Quality, Performance, and Productivity," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 18116-18153, December.
    3. C.N.R. Wijesundara & Ali Khatibi & S.M. Ferdous Azam & Jacquline Tham, 2024. "Extent of Corporate Sustainability Adoption in the Hospitality Industry: A Case Study of Tourist Hotels in Sri Lanka," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(9), pages 79-92, September.
    4. Chenghao Zhong & Wengao Lou & Yongzeng Lai, 2023. "A Projection Pursuit Dynamic Cluster Model for Tourism Safety Early Warning and Its Implications for Sustainable Tourism," Mathematics, MDPI, vol. 11(24), pages 1-17, December.
    5. Indah Fajarini Sri Wahyuningrum & Amin Chegenizadeh & Ain Hajawiyah & Sriningsih Sriningsih & Sri Utami & Mochamad Arief Budihardjo & Hamid Nikraz, 2023. "Determinants of Corporate Water Disclosure in Indonesia," Sustainability, MDPI, vol. 15(14), pages 1-17, July.

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