The University of Southampton
University of Southampton Institutional Repository
Warning ePrints Soton is experiencing an issue with some file downloads not being available. We are working hard to fix this. Please bear with us.

Sustainable environmental practices and financial performance: evidence from listed small and medium-sized enterprise in the United Kingdom

Sustainable environmental practices and financial performance: evidence from listed small and medium-sized enterprise in the United Kingdom
Sustainable environmental practices and financial performance: evidence from listed small and medium-sized enterprise in the United Kingdom
In this article, we investigate the financial implication of sustainable environmental practices on UK small and medium‐sized enterprises (SMEs)–traded firms. Existing literature indicates that there is a direct relationship between sustainable environmental practices and financial performance. However, studies looking at this relationship have focused mainly on large firms with little attention paid to SMEs. Further, those looking at environmental and financial performance relationships have often used a single measure of performance in their studies. This study bridges these research gaps by focusing on listed SMEs in the United Kingdom using multiple measures of sustainable environmental policy indices on a panel of 201 SMEs on the Alternative Investment Market from 2011 to 2016. Evidence from our panel data analysis suggests significant and a nonlinear (concave) relationship between sustainable environmental practices and firms' financial performance. Specifically, energy efficiency practices, greenhouse gases, material, and resource efficiency revealed an inverted U‐shaped relationship with financial performance. The results will offer guidance to management in terms of allocating resources to sustainable environmental practices investment.
SMEs, development, environmental practices, financial performance, stakeholder engagement, sustainable
0964-4733
2583-2602
Boakye, Danquah Jeff
1d5deb56-32ce-4641-8a15-2f2bf80b15d2
Tingbani, Ishmael
e6b2741a-d792-4adf-84cc-a2f64d5545ca
Ahinful, Gabriel
215f135d-6345-444f-bb30-f0e2bd2ee9c8
Damoah, Isaac
24e93686-945a-4459-aae9-0cc0fd7483bc
Tauringana, Venancio
27634458-b041-4bc1-94da-3e031d777e4f
Boakye, Danquah Jeff
1d5deb56-32ce-4641-8a15-2f2bf80b15d2
Tingbani, Ishmael
e6b2741a-d792-4adf-84cc-a2f64d5545ca
Ahinful, Gabriel
215f135d-6345-444f-bb30-f0e2bd2ee9c8
Damoah, Isaac
24e93686-945a-4459-aae9-0cc0fd7483bc
Tauringana, Venancio
27634458-b041-4bc1-94da-3e031d777e4f

Boakye, Danquah Jeff, Tingbani, Ishmael, Ahinful, Gabriel, Damoah, Isaac and Tauringana, Venancio (2020) Sustainable environmental practices and financial performance: evidence from listed small and medium-sized enterprise in the United Kingdom. Business Strategy and the Environment, 29 (6), 2583-2602. (doi:10.1002/bse.2522).

Record type: Article

Abstract

In this article, we investigate the financial implication of sustainable environmental practices on UK small and medium‐sized enterprises (SMEs)–traded firms. Existing literature indicates that there is a direct relationship between sustainable environmental practices and financial performance. However, studies looking at this relationship have focused mainly on large firms with little attention paid to SMEs. Further, those looking at environmental and financial performance relationships have often used a single measure of performance in their studies. This study bridges these research gaps by focusing on listed SMEs in the United Kingdom using multiple measures of sustainable environmental policy indices on a panel of 201 SMEs on the Alternative Investment Market from 2011 to 2016. Evidence from our panel data analysis suggests significant and a nonlinear (concave) relationship between sustainable environmental practices and firms' financial performance. Specifically, energy efficiency practices, greenhouse gases, material, and resource efficiency revealed an inverted U‐shaped relationship with financial performance. The results will offer guidance to management in terms of allocating resources to sustainable environmental practices investment.

Text
Sustainable environmental practices and financial performance- Evidence from listed small and medium-sized enterprise in the United Kingdom - Accepted Manuscript
Restricted to Repository staff only until 30 April 2022.
Request a copy

More information

Accepted/In Press date: 30 April 2020
e-pub ahead of print date: 19 May 2020
Published date: 19 May 2020
Keywords: SMEs, development, environmental practices, financial performance, stakeholder engagement, sustainable

Identifiers

Local EPrints ID: 441297
URI: http://eprints.soton.ac.uk/id/eprint/441297
ISSN: 0964-4733
PURE UUID: cc788bb1-9493-460c-8e20-d29ce28c297b
ORCID for Ishmael Tingbani: ORCID iD orcid.org/0000-0002-4012-1224
ORCID for Venancio Tauringana: ORCID iD orcid.org/0000-0002-1433-324X

Catalogue record

Date deposited: 09 Jun 2020 16:30
Last modified: 26 Nov 2021 03:22

Export record

Altmetrics

Contributors

Author: Danquah Jeff Boakye
Author: Gabriel Ahinful
Author: Isaac Damoah

Download statistics

Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.

View more statistics

Atom RSS 1.0 RSS 2.0

Contact ePrints Soton: eprints@soton.ac.uk

ePrints Soton supports OAI 2.0 with a base URL of http://eprints.soton.ac.uk/cgi/oai2

This repository has been built using EPrints software, developed at the University of Southampton, but available to everyone to use.

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we will assume that you are happy to receive cookies on the University of Southampton website.

×