Sustainability and Corporate Performance: Moderating Role of Environmental, Social, and Governance Investments in the Transportation Sector

Abstract

This study employs the two-stage dynamic data envelopment analysis model to examine sustainability and corporate performances of the 29 largest multinational enterprises in the transport manufacturing industry from 2015 to 2019. The results show that, on average, sustainability has a positive relation to corporate performance and sustainability performance is better than corporate performance for all multinational enterprises (MNEs). In addition, we also found that corporate social responsibility (CSR) acts as a moderator in the relationship between sustainability and corporate performances. Overall, the American group leads the others in sustainability performance, followed by Asia and Europe. On the other hand, Europe has the highest score in terms of corporate performance. In terms of size, the results show that it is positively related to corporate performance. In contrast, leverage has a negative relationship with corporate performance. The findings of this research can assist inefficient MNEs in identifying areas for advancement by learning from their peers and provide perspective and insights into the plans for MNEs’ strategies and decisions in the future.