The effect of Corporate Sustainability Performance on the Brand
Value of Multinational Companies in emerging and developed
markets
MSc Business Administration – Strategy – Master Thesis
Roderick Ruinard 10676872 University of Amsterdam Amsterdam Business School - Faculty of Economics and Business Supervisor: Sebastian Kortmann
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Statement of Originality
This document is written by Roderick Ruinard who declares to take full responsibility for the contents of this document.
I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.
The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.
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Content
Abstract ... 4
1. Introduction ... 5
2. Literature review ... 9
2.1 Corporate Sustainability Performance ... 9
2.2 Brand value ... 12
2.3 Emerging and developed markets ... 17
3. Theoretical framework and hypotheses ... 23
4. Methodology ... 28 4.1 Research design ... 28 4.2 Sample ... 28 4.3 Measurement of variables ... 29 4.3.1 Dependent variable ... 29 4.3.3 Independent variable ... 29
4.3.3 Moderating and anteceding variables ... 31
4.3.4 Control variables... 31
5. Results ... 33
5.1 Analytical strategy, descriptive statistics and correlation ... 33
5.2 Hypothesis testing with linear regression ... 34
6. Discussion ... 38
6.1 Corporate Sustainability Performance and Brand Value in emerging and developed markets . 38 6.2 Implications ... 42
6.3 Limitations and future research ... 44
7. Conclusion ... 46
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Abstract
This study analyzes whether addressing economic, social and environmental concerns, in other words being sustainable, influences brand value of multinational companies (MNCs) and tests how this effect differs in emerging and developed countries. With increased pressure and empirical evidence that financial success only is not sufficient in the current competitive environment, MNCs want to know if the three sided topic of sustainability actually pays off. Also, increased internationalization, the battle between regionalization and globalization and the rise of the emerging markets make companies continuously evaluate the success of their (sustainability) strategies in different markets and countries. This study proposes that firms that have a high Corporate Sustainability Performance (CSP) are rewarded by their customers and other stakeholders with a higher Brand Value. Furthermore, it is hypothesized that companies from developed markets are more successful when it comes to sustainability and that this fact influences the relationship between CSP and brand value. Consumers and other stakeholders from emerging countries are expected to value sustainability less than those from developed countries. To evaluate these propositions, a sample of 138 MNCs has been analyzed quantitatively, but little empirical evidence for the hypotheses was found. However, a surprising result was found for the relationship between the development of a country and the CSP of MNCs. It seems that nowadays companies from emerging countries are better performing when it comes to sustainability then their developed country counterparts. The fact that no evidence for the other proposed relationships was found might be because brand value is based on other factors than sustainability, such as company size and innovation, that companies are not effective in communicating sustainability initiatives or that they simply don’t see the need to do so. The results from this research provide various implications and contributions for both theory and practice and interesting openings for future research.
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1. Introduction
Corporate sustainability, is it really worth it? We are in the middle of a shifting landscape for companies and corporate sustainability. Almost all of the world’s largest companies report on sustainability initiatives and use their reports to identify environmental and social changes that impact their business and its stakeholders (KPMG, 2013). They have a strategy to manage risks and opportunities involved with these changes and have identified that they can exploit them for opportunities in innovating, market share growth and cutting costs. And it is where these companies lead, that other companies will follow. The recognition is there that we are all living on a planet subject to many changes on environmental, social and economic level. The world population is increasing dramatically and the climate is changing because of pollution and the greenhouse-effect, which both cause resources to deplete. Changes in social conditions and expectations and the shift towards new norms and values of consumers have given companies plenty of food for thought. The exponential growth of the emerging markets and the rise of the emerging market multinational provide opportunities, but also increased competition, uncertainty and risk. In the end of the day, multinational companies (MNCs) are commercial organizations, with shareholders to satisfy. Managers of MNCs continuously are struggling with the question if and how sustainability actually pays-off.
Sustainability is associated with the equal consideration of social, ecological and economic goals by firms. By considering these different goals and subsequently implementing a sustainability strategy, firms combine long-term profits with their goals to protect the ecosystem. With growing sensitivity towards social issues, companies are increasingly expected to take greater responsibility for making sustainable development a reality. A firm that is oriented on sustainability aims for financial and competitive success, but simultaneously for social legitimacy and the efficient use of natural resources (Perrini & Tencati, 2006). However, defining this new role is a major challenge for companies as they search for ways to balance economic, environmental and social performance. To integrate sustainability principles into their business strategies and to aid resource allocation decisions, managers must quantify the link between social and environmental actions and financial performance. Therefore, companies are increasingly attempting to link social and environmental initiatives to financial performance (Epstein and Roy, 2003). The common thought among companies about social and environmental care is that it increases costs and possibly negatively influences competitiveness (Russo & Fouts, 1997). However, research seems to show the opposite. Eccles (2012) investigated the effect of a corporate culture of sustainability on multiple facets of corporate behavior and performance outcomes. He found that high sustainability companies significantly
6 outperform their counterparts over the long-term, both in terms of stock market and accounting performance. Nevertheless, managers are still looking for answers to the question how their companies can improve sustainability performance, and, more specifically, how they can identify, manage and measure the outcomes of improved sustainability performance (Epstein, 2001).
Stakeholder opinion can be a source of information to measure the outcomes of a company’s sustainability strategy and if firms with high sustainability performance actually benefit. Stakeholders are defined as ‘any group or individual (in the organizations environment) who can affect or are affected by the achievement of the organizations objectives’ (Freeman, 1984). Firms that manage for stakeholders develop trusting relationships with them, which helps them acquire important information that can spur innovation (Harrison et al, 2010). The challenges of sustainability can be linked to creating sustainable value for all stakeholders of the firm (Hart, Milstein, & Caggiano, 2003). Nowadays, for the largest stakeholder group, the consumers, social and environmental concerns have earned a significant level of importance (Cleveland et al., 2005).
A significant link between companies and their consumers are brands. ‘’Brands are the worlds new opinion makers’’ (Kunde, 2002). Brands have evolved over the past 50 years from something that only has to resonate with the rationale of consumers to something that has to weave with spiritual and ethical values of consumers in order to establish a long term relationship (Pringle and Thompson, 2001). The potential of stakeholder opinion and the measurement of the pay-off of corporate sustainability performance (CSP) gives space to a new measure of firm performance: the brand value of companies. The reputation of a company seems to be the missing link between corporate financial and social performance (Orlitzky et al, 2003). All actions and behavior of companies reach stakeholders and affect their perception of the company, the brand and their subsequent (buying) behavior (Duncan & Moriarty, 1998). By having a good or even superior reputation, companies engaging in social and environmental strategies are rewarded by their stakeholders and this will ultimately result in superior financial performance (Roberts and Dowling, 2002; Porter and Kramer, 2006). Now what is the core component of the reputation of a company? It is its brand (Fan, 2005). When effectively and efficiently communicated, the brand of a company serves as a signal towards consumers and other stakeholders. It can build trust, reputation and in the end a fertile relationship between stakeholder and company (Duncan & Moriarty ,1998). Therefore, it is the value of this brand that can be used as a measure for firm performance and can explain a source of competitive advantage. In a single variable, brand value includes components and characteristics like economic earnings, the driving consumer demand and the brand strength, being its reputation, loyalty and
7 market position, that are all sensitive to social, ecological and environmental influence (Melo & Galan, 2010; First & Ketriwal, 2008).
Another issue that multinational companies face more and more, besides questions regarding sustainability and its pay-off, is the rise of emerging markets and the globalization/regionalization trade-off. Emerging markets have become the focus of academic research over the past 20 years for multiple reasons. They comprise the majority of the world population and land and grow much faster than developed markets. They are subject to different conditions in terms of for example their legal, business and political environment. Other, more specific differences between emerging and developed markets are factors such as language, culture and level of income (Hoskisson et al., 2000; Kearney, 2012). These different environments might need different approaches regarding sustainability issues. These approaches might yield different results, of which brand value is one measure in the different markets. As a consequence, previous research has addressed the issue of MNCs and their international strategies and the distinction between emerging and developed economies (Hoskisson et al. 2000; Nielsen 2011). MNCs are companies that are active in both their home markets and foreign markets and more and more of them see the opportunity to enter emerging economies. Emerging economies require different strategies from MNCs to cope with their broad scope and large amount of economic and political change (Hoskisson et al, 2000). Strategies that are effective in developed countries might not be as effective in emerging countries and require adaption (Peng et al., 2008). Therefore, it seems obvious that MNCs should distinguish in their strategic approach in different markets (Jansson, 2008).
So why this study? Summarizing, MNCs are trying to become more sustainable, operate in both developed and emerging markets, with different perceptions and opinions among consumers and other stakeholders regarding sustainability and want to know if their sustainability strategies pay off. By using brand value, a powerful instrument to asses stakeholder opinion and a different way of measuring firm performance, this study can address these questions about the corporate sustainability performance of MNCs.
There is already some research on the areas of corporate social responsibility, environmental performance, consumer behavior and brand value (First & Ketriwal, 2008; Melo & Galan, 2010, Becker-Olsen & Hill, 2005) , but there is not yet an integrated approach that researched corporate sustainability performance and brand value. The distinction between brand value in emerging and developed markets has been made (Aaker, 1996; Essousi & Merounka, 2007), but not in combination with CSR or CSP.
8 This study addresses the effect of Corporate Sustainability Performance (CSP) on brand value in emerging and developed countries. By conducting database research on 136 multinational companies, it answers the question to what extent stakeholders, especially consumers, are influenced by the, whether or not successful, sustainability strategy of firms. Considering the fact that many MNC´s are operating in both developed and emerging countries, those will be distinguished. By clarifying these aspects of sustainability strategies and performance, various practical implications will arise. MNCs, originated in both developed or emerging countries, will be able to assess the effects of improving or adjusting their sustainability strategy and learn if it, among other ways, can be used to improve brand value, which could be seen as a way to gain a competitive advantage over competition (Porter & Kramer, 2006).
The following research question is formulated:
What is the effect of Corporate Sustainability Performance on a MNCs brand value in developed and emerging countries?
To answer this question, the rest of the paper is structured as following. First, a critical review of the relevant literature on the research topic is outlined. This review is guided by the following subtopics: corporate sustainability and its (financial) performance, brand value and the distinction between emerging and developed markets. This literature review results in a theoretical framework and the development of hypotheses. In the next section the research method is explained with a description of the sample, the research strategy, the measurement of variables and the way the data is analyzed in order to answer the hypotheses. Next, the results of the study are given and described, including an overview of descriptive statistics and results of various regression analyses. In the discussion section the context of the study is elaborated. The results are compared with current theoretical insights on topics such as corporate sustainability and brand value and are interpreted with these in mind. Managerial implications are also given. The study will be critically viewed and limitations of the research are given, followed by directions for future research to increase and improve the available knowledge on the topic. Finally, the conclusion summarizes the whole study, its results and implications.
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2. Literature review
This chapter identifies the relevant literature on the research topic of this study. To be able to contextualize the topic, the specific subjects of corporate sustainability performance, brand value and emerging and developed markets are introduced. The currently available literature combined with new research contributes to a better understanding of the specific topics and their relationships.
2.1 Corporate Sustainability Performance
In a changing environment, the strategies of multinational companies have to be constantly adapted, improved and extended. In the current 21st century, companies face a highly competitive environment, where continuous profits are not guaranteed. Also, with resource depletion, pollution and the quest for socially responsible actions, the emergence of new strategies is inevitable. Sustainability grounds the development debate in a global framework, within which a continuous satisfaction of human needs constitute the ultimate goal (Brundtland, 1987). When converting this idea to the business level, corporate sustainability can accordingly be defined as meeting the needs of a firm’s direct and indirect stakeholders (such as shareholders, employees, customers, NGO’s etc), without compromising its ability to meet the needs of future stakeholders as well. Consequently, as a result of rapid depletion of natural resources and growing concerns over wealth disparity and corporate social responsibility, business research has increasingly focused on sustainability (Agrawal, 2002). The topic is not something new (Bowen, 1953), but with the world population growing exponentially, more important than ever.
Sustainability is associated with the equal consideration of three sides: the social, ecological and economical goals by firms (Epstein, 2014). By considering these different goals and subsequently implementing a sustainability strategy, firms combine long-term profits with their goals to protect the ecosystem. With growing sensitivity toward social issues, companies are increasingly expected to take greater responsibility for making sustainable development a reality. A firm that is oriented on sustainability, strives for financial and competitive success, but also for social legitimacy and the efficient use of natural resources (Perrini & Tencati, 2006). Today, most managers see corporate sustainability as inevitable in day to day business (Holliday, 2001). They know that to become more sustainable, they must address the different dimensions of sustainability at the strategic level as a part of the strategy content at the corporate, business and functional levels (Bonn & Fisher, 2011). More specific, firms have started appointing sustainability officers, publish annual sustainability reports and have begun to incorporate sustainability strategies (Dyllick & Hockerts, 2002). In
10 practice, sustainability is becoming the key driver of innovation more and more (Nidumolu et al, 2009), with companies developing new , more sustainable, environmental and social friendly, business models to stay competitive (Eweje, 2011).
There are many definitions in academic debates and business environments that refer to the three sided issue of sustainability and they all have been proposed referring to a more humane, more ethical and more transparent way of doing business (Van Marrewijk, 2003). The literature uses both corporate social responsibility (CSR) and corporate sustainability (CS) to refer to social and environmental management issues, but there is no clear distinction between the two terms. Montiel (2008) shows that the two concepts are converging, even though there are some points of difference. Companies use both terms for their reports, which makes their overlapping more evident. In the past, sustainability related only to the environment and CSR only to social aspects such as human rights. Nowadays many consider CS and CSR as synonyms, but van Marrewijk (2003) recommends a distinction. He argues that CSR relates to phenomena such as transparency, stakeholder dialogue and sustainability reporting, while CS is considered the ultimate goal and focuses on the actual value creation and the environmental and human capital management. Since MNCs are searching for strategies that create sustainable value for themselves and other stakeholders (Porter & Kramer, 2011), it is this ultimate goal that is seriously interesting to research. To demarcate the research area for this study, the definition for corporate sustainability, and not corporate social responsibility, is used. The study will look at the value that is created by MNCs by addressing the three factors of sustainability: social, environmental and economic.
This perspective on doing business is called the ‘Triple Bottom Line’ (Elkington, 1997). Business is sustainable when it lives up to the “triple bottom line” of economic prosperity, environmental quality and social justice. The three dimensions are also commonly called the three Ps: people,
planet and profits and they are interrelated, interdependent, and partly in conflict.
Only a company that measures performance across this triple bottom line is taking account of the full costs involved in doing business. More specific, companies should incorporate three dimensions in their corporate strategy. The environmental dimension refers to issues such as pollution and waste prevention, the social dimension refers to the contribution to a better society and the economic dimension refers to economic results, such as the creation of shareholder value or preserving the profitability of the firm (Hart et al., 2003; Dahlsrud, 2008).
Notwithstanding that there has been a great deal of attention paid in the media and academic research to the notion of corporate sustainability and the fact that nowadays corporations,
11 particularly those that have global presence, are required to commit to sustainability strategies and practice, there is also evidence that firms do not sufficiently address the environment or social issues. This is often caused by a lack of understanding of the three-sided issue of sustainability and its costs and benefits (Schaltegger & Synnestvedt, 2002). The problem of the Triple Bottom Line is that the three separate factors, social, environmental and financial cannot easily be added up. It is difficult to measure the planet and people accounts in the same way as profits, that is, in terms of cash (Norman & Macdonald, 2004). Much research therefore has tried to link the different dimensions, the environmental, social and financial, in terms of performance. Does it pay off to be socially or environmentally responsible? The conventional thought about environmental care is that it comes at an extra cost, which may influence competitiveness of firms. However, research has shown that improving a company's environmental performance can lead to better economic or financial performance and not necessarily to an increase in costs (e.g., Porter & van der Linde, 1995, Russo & Fouts, 1997). Especially the right environmental management, more specific the managerial qualities on this area, has a significant influence on economic performance (Schaltegger & Synnestvedt, 2002). Ambec (2008) shows that environmental expenses can be offset by gains on areas such as better access to certain markets, product differentiation and selling pollution-control technologies or a lower cost of capital and labor. The link between social and financial performance also has been made. Corporate virtue in the form of social responsibility is likely to pay off (Orlitzky et al, 2003), people and profit are positively linked (Margolis & Walsh, 2001). Overall, corporate sustainability performance has a positive effect on firm financial performance (Wagner, 2010).
The fact that sustainability can have a positive effect on financial performance shows that the sustainability of a company is not something that is only an internal case, since profits are generated by the whole network of stakeholders, from suppliers to consumers. Sustainability not only depends on employees, shareholders and clients, but it also depends on various external stakeholders, such as the firms suppliers, public authorities and the civil society (Perrini & Tencati, 2006). By considering the well-being of their customers, the depletion of natural resources vital to their businesses, the viability of suppliers and the economic distress of the communities in which they produce and sell, companies can bring business and society together. This, by generating economic value in a way that also produces value for society and the environment by addressing their challenges. By incorporating this complete network, these strategies might eventually lead to economic success and competitive advantage (Porter and Kramer, 2006, Porter & Kramer, 2011).
From the other side of the table, other research has addressed the stakeholders point of view on sustainability and the societal demand for sustainability practices. Consumers are increasingly aware
12 of sustainability and the practices that can be performed by companies (McDonald & Oates, 2006). Changes in values and an expanding normative framework of consumers cause that companies are asked to become more involved in solving environmental and social problems. It is required to achieve the blessing of the community in order to survive (Lopez et al, 2007). In fact, two in three citizens want companies to go beyond their historical role of making a profit, paying taxes, employing people and obeying all laws; they want companies to contribute to broader societal and environmental goals as well (Gugler & Shi, 2009). Consumers expect firms to be involved in social and environmental initiatives and may reward them for their efforts through purchase behavior (Becker-Olsen & Hill, 2005). Eccles (2012) confirms this notion, by specifically showing that high sustainability companies strongly outperform low sustainability companies over time, both in terms of stock market and accounting performance. This effect is most visible in sectors where the customers are individual consumers, companies compete on the basis of brands and reputation and in sectors where companies’ products significantly depend upon extracting large amounts of natural resources (Eccles, 2012). In addition, Shrivastava (1995) argues that sustainability endorses a company's public relations and corporate image. It can help companies both to establish a social presence in markets and to gain social legitimacy. So, for companies to better understand the value of sustainability strategies, a broader perspective of sustainability pay-off is required. In assessing the benefits and potential of successful sustainability strategies, MNCs might find more to come than financial pay-off only.
2.2 Brand value
Companies are ever searching for mechanisms and measures to test whether their executed strategies are successful and what they deliver in terms of value for the company and all of its stakeholders. Many research has focused on the benefits of corporate sustainability and is mostly focused on the correlation with corporate financial performance (Melo & Galan, 2010). This association however is often not directly linked to the CSR or corporate sustainability of the firm itself. The financial rewards are most frequently considered to be a direct consequence of benefits from reputation or image status which is gained through these social and environmental activities. McWilliams and Siegel (2001) support this issue by pointing out that a firms expression of corporate sustainability creates a reputation that the firm is reliable and honest. By being reliable and honest, consumers will tend to assume that products of this firm are better or of a higher quality than the products of companies that show no interest in corporate sustainability. In addition, companies that enjoy a good reputation among consumers are better able to sustain their competitive advantage and secure long-term profits. Reputation is the link between social and financial performance, which
13 implies that companies engaging in CSR, are rewarded by their stakeholders, which will reflect in superior financial performance (Roberts and Dowling, 2002 ; Porter and Kramer, 2006).
To be more specific, consumers adapt their beliefs, attitudes, intentions and actions as a result of their perception of a firms actions (Becker-Olsen & Hill, 2005). Thus, an important notion that MNCs could and should build on when thinking about their sustainability strategies is that the behavior of consumers and other stakeholders is strongly affected by the social and environmental initiatives of companies.
By this reasoning, a different and new measure of the pay-off of social, financial and environmental performance can be found in the stakeholder opinion with respect to the company, or in other words: the companies reputation. The core component of corporate reputation is the corporate brand (Fan, 2005). Bravo et al (2007) corroborate this notion and regard the brand of a company as a unique opportunity for them to influence the perceptions of consumers and other stakeholders. Brand reputation is build up over the years, as are other factors such as brand image and trust and they are key in ensuring future profits (Kapferer, 2004). An organization’s image is the cumulative assessments of the firm by its stakeholders over time. If the firm conforms to stakeholder expectations, it builds legitimacy, which helps build stronger relationships and trust with these stakeholders (Bansal & Bogner, 2002). Furthermore, if people trust a company they are more likely to transact with it. “At the end of the day, customers buy, financers invest in, and prospective employees want to join companies that they trust” (Brady, 2003).
These insights have triggered a shift among managers thoughts. They have started to realize that the primary asset of their company was their brand. The real value of the strategy of companies lies in the minds of consumers (Kapferer, 2004) and firms with a strong brand create superior shareholder value (Madden, Fehle & Fournier, 2006). Concluding, as opposed to conventional indicators of firm performance, such as sales or growth, brand value can serve as an alternative performance measure with different (managerial) insights and implications.
So, brands are important to firms and incorporate much useful information. Now what are brands and how can they be measured? The understanding of ‘what is a brand’ is not universal (First & Ketriwal, 2008). The definitions are varying from simple ones where a brand is perceived as a name, logo or a legal instrument, to more extensive or holistic ones that refer to a brand as a positioning, a cluster of values, a relationship and a promise to the customer (De Chernatony, 2010; Kapferer, 2004). In this research the brand is seen at the holistic level, since this strokes best with the value creation question that is associated with sustainability strategies. The two main purposes of brands are to create differentiation from competitors and to represent a certain value. Consumers use
14 brands to direct them in chossing to buy a certain product (Bridson & Evans, 2004). By representing a a specific quality, security and consistency, the brand can create customer loyalty and trust, and, in the end, superior profits (Werther, 2005). Keller (2003) explains that because of complexity, a brand requires strategic planning. Strategies should take the brand into account and vice versa. Many conceptual models in literature, of which two are explained below, are built to cope with this complexity (Aaker and Joachimsthaler, 2000). The key elements of a brand are its identity, its image and its relationship with stakeholders, by showing value propositions and potential benefits. Brand identity is what a brand wants to be perceived as, what it transmits to the customer. Brand image is defined as the perceptions about a brand which are reflected by various associations that a
consumers makes in its mind when thinking of the brand (Keller, 1993).The brand’s image is what
actually reaches the customer and is created through the associations that the brand activates. This image differs from the brand identity because of market noise and competition (Kapferer, 2004). In the end, this brand image is what matters, but to manage this perceived image of the brand, a firm should manage its brand identity at first (First & Ketriwal, 2008).
This management of brand identity starts with the strategy and its communication by a company. Firms that want to distinguish themselves from others can do so by executing certain strategies. Strong care for environmental and social issues are examples. However, the development and use of such strategies is not enough: they have to be communicated. As explained before, a strong brand is built on reputation, trust and a good perception among stakeholders and consumers. A company’s actions, such as strategies, can create these critical factors, but in order to appropriate value from them, effective and efficient communication is necessary. Duncan & Moriarty (1998) show the importance of communication for companies in building brand relationships, which are the relationships of a company with its consumers and other stakeholders. Communication is the human activity that connects people and creates relationships. It integrates the company with its consumers and other stakeholders by sharing information, answering questions and listening. Everything that a company does or does not, impacts the stakeholders of the company and therefore impacts the brand (Schultz, 1992). For example, employee hiring conditions, environmental policies and financial performance, all issues involved with sustainability, communicate certain signals or meanings that affect stakeholders and brand relationships. Since previous research has shown that it is not possible to not communicate, companies and brands must manage both unplanned, such as word of mouth, and planned communication, such as advertising (Duncan & Moriarty (1998). All decisions made by consumers are made within a constellation of consumption activities, situations, social environments and related products. So, consumers substantiate their behavior by processing signals from many sources. This means that by effectively using information and other signals, companies can build a
15 certain relationship with their consumers and other stakeholders, which determines brand identity and brand image and consequently drive brand value for the company. Firms can create positive associations with their brands, but also negative ones. A positive brand image links with strong, favorable, and unique associations to the brand (Keller, 2008). Corporate actions that violate societal expectations may damage or even destroy the brand image among stakeholders, among which current and also potential consumers of a firms products and services (Werther, 2005).
With brands being signals of company and product positions, they enable companies to credibly inform consumers and other stakeholders. This credibility is important. Only if the information about a brand is credible, it will influence stakeholders perceptions, actions and behavior and possibly create a brand relationship (Erdem, 1998). So, within these relationships, trust, as also explained earlier, plays a crucial role. Trust is the corner-stone and a desirable quality in any relationship. This makes brand trust key in creating brand loyalty and brand value. Next to factors that summarize the knowledge and experience of consumers and other stakeholders, such as perceived quality, brand reputation and satisfaction, trust is the factor that generates customer commitment. So companies should manage not only customer satisfaction, but also more abstract factors. These are related to the customer perception of how his or her interests and welfare are considered by the companies brand and subsequently help the customer to feel secure and therefore trust the brand to satisfy his or her needs in future situations, thus increasing expected utility. This results in commitment and a higher brand value, since the customer will be willing to pay more for the brand (Delgado-Ballester & Munuera-Alemán, 2005). The use of brands, branding, is a crucial signaling concept, since it provides stakeholders with information. By means of branding, companies are able to create favorable differences among consumers perceptions of the own firm in comparison with others (Keller, 2003). Because of the possibilities that brands create for MNCs, managers want to know how they can measure the outcomes or strength of their brands. Two different ways of measuring the effects or strength of a brand are common in previous research; brand value and brand equity (Raggio & Leone, 2007). In academic literature brand equity is often discussed as an equal notion of brand value. However, Raggio & Leone (2007) show that they are separate constructs, with brand equity being a part or precursor of brand value. Brand equity moderates the impact of marketing activities on consumers ’actions, implies a consumer-based focus and represents one of many factors that contribute to brand value. Brand value in its turn is defined as the sale or replacement value of a brand, which implies a company based perspective. Brand equity represents what the brand means to the consumer, whereas brand value represents what the brand means to a focal company. Thus, brand equity is defined as the perception or desire that a brand will meet a promise of benefits. Keller (1993) states that brand equity is ‘’the differential effect of brand knowledge on consumer
16 response to the marketing of the brand’’. Each consumer has his or her own perceptions about the salience of a promise of benefits and the brand ’s performance. Therefore, brand equity must be an individual-level construct, which implies that neither the brand nor the firm ‘owns ’ a brand’s equity, it is all in the mind of the consumer (Raggio & Leone, 2007). The management of brand equity involves managing the collection of all meanings associated with a brand (Aaker, 1991). In order to reach a superior relationship level with the consumers, it is first necessary that these consumers obtain the right and also sufficient brand knowledge. The strength of a brand has its origin in what customers have learned, felt, seen and heard about the brand during their experiences with it (Keller, 2003). This again emphasizes the need for effective and efficient communication of norms, values, actions and (sustainability) strategies of companies.
Opposite to seeing brands from a consumer based perspective on brands, but looking at them from a corporate based perspective, the definition of brand value is the more widely used in academic literature, while brand equity is not. Brand value represents what the brand means to a focal company and it may vary depending on the owner (or potential owner) of the brand, because different owners may be able to capture more or less potential value according to their ability to leverage brand equity. Raggio and Leone (2007) define brand value as the sale or replacement value of the brand. They state that brand value and brand equity are connected. Brand value is impacted by brand equity to the extent that brand equity contributes to more positive financial outcomes in favor of the brand. From a managerial point of view, the primary task of brand managers is to maximize and leverage brand equity to increase brand value. Further distinguishing between brand equity and brand value, brand value is impacted by managerial decisions related to pricing, brand scope, segmentation and positioning. Additionally, brand value also accrues to firms from sources that are not directly related to customers or consumers in general. These sources can be patents, trademarks, channel relationships, superior management and creative talent. They are all brand assets that contribute to brand value, but since they are not derived from consumers, they are not a component of brand equity. These assets allow a firm to reduce competition, by for example patents, or to create and leverage brand equity, by for example superior management and capabilities and thus are valuable to a firm. For this research brand value, and not brand equity, will be used, because it incorporates the full array of factors that influence the measure of a brand. It will give the most comprehensive measure of sustainability performance effects on the brands of MNCs.
To assess the sources and outcomes of brand equity and the manner by which certain strategies create brand value, Keller (2003) developed the brand value chain, which to some extent summarizes the above described academic literature. The brand value chain provides a holistic approach to understanding the value created by brands and it is based on the fact that the value of a brand in the
17 end resides in the associations that consumers or other people have with that brand. The creation of brand value thus starts with the firm's communication of their strategies, of which among others also their sustainability activities. These activities influence customers who, in turn, affect how the brand performs in the marketplace and how the brand is ultimately valued by the financial community.
Thus, the opinion of consumers and other stakeholders determines the value of a brand. This causes MNCs to think about questions like: Who are my customers? Where are they? What do they want? How do they value sustainability? How do they value my company and products? Therefore, some of the key components for MNCS crafting a successful brand strategy include the debate over global versus local messaging and control, the power of brands to create and reflect social and cultural values, the pressure for brands to be authentic and the need for companies to recognize a brand’s stakeholders (Werther, 2005). Firms must identify different segments within different markets to be able to increase focus and maximize the potential of their brand. The different market segments are subgroups of organizations or people that have similar needs for products and services, because they share one or more characteristics or have common needs and show common buyer conduct. By means of segmentation, firms can recognize the differences among customers and target those with similar needs in a similar way (Yankelovich & Meer, 2006). One of the most characteristic segmentations is that of different countries, possibly requiring different strategies and customer approaches.
2.3 Emerging and developed markets
Since multinational companies are active in different countries worldwide, hence the multinational in its name, it is interesting to look at the differences in both global and local markets. Different countries account for different market specific situations such as consumers with their own specific preferences. In these markets, (sustainability) strategies may have different results. International business literature has discussed the comparison of emerging and developed markets, where it focused on levels such as economics, finance, international business and management, sustainability and consumer behavior, and found both differences and overlap. Results show that both private and public companies had to develop specific strategies for the two markets to be able to deal with the broad scope and speed of political and economic change in emerging markets (Hoskisson, 2000). However, the topics of sustainability and consumer behavior still give space to more specific research on these single topics, when looking at them in the different markets (Kearney, 2012). These facts make it interesting to delve deeper into the issue of globalization, the differences of emerging and developed countries and how these could affect sustainability strategies and consumer behavior.
18 Globalization is driven by a search for new capital, talent, resources and new consumers and many researchers have shown the potential benefits of globalization. They emphasized the need for multinational firms to handle strategies that help them to compete not only in their home country, but global (Hamel and Prahalad, 1985; Levitt, 1983). Originally, literature has emphasized the potential of standardization and how it can create a competitive advantage for multinational companies (Levitt , 1983). By integrating different markets around the world, companies find the opportunity to make use of synergies and arbitrage in different countries. For example, worldwide standardization of products, activities and processes enables economies of scale (Kobrin, 1991). Ohmae (1987) defined this somewhat as the triad power concept, where MNCs attempt to have “equal penetration and exploitation capabilities, and no blind spots, in each of the triad regions”, with the triad regions being North America, Asia an d Europe. Recent data indeed shows the increased growth of world trade in relation to world Gross Domestic Product (GDP) and also shows that the number of MNCs engaging in international activities is increasing.
However, globalization has also been described from a different angle in literature. Rugman (2001), called Ohmae’s (1987) triad power concept a myth and stated that following a global strategy would face the problem of global deadlock, when attempting to penetrate the three regions with a similar strategy. Therefore, later research has focused on regional strategies, opposed to global ones. The world is not homogeneous and most MNCs operate in a semi-globalized world (Ghemawat, 2003). Firms need to find a strategy that fits between the two extremes of complete integration or complete isolation of markets across the world. Rugman and Verbeke (2004) support this view by their research on regionalization in the Fortune Global 500. Only a couple of the world largest MNCs can be seen as true global companies. Most companies were strongly focused on their home markets in terms of their total sales. This disagreement regarding globalization or regionalization shows that both academic researchers and MNCs are still on a quest for answers to specific situations that have to deal with this issue.
This quest is fueled by the growth of emerging markets and the subsequent expansion of emerging market based multinational companies. They are expanding at a high speed and scale and already boast 70 of the Fortune Global 500 list of the world’s biggest companies, coming from just 20 companies 10 years ago. This growth is driven by the search for new markets, efficiency, innovation and government policies. The expansion of these companies also synchronizes with a period of plentiful supply of cheap capital, domestic policies intended to liberalize investment and advances in information technology (UNCTAD, “World Investment Report, 2007). With a large growth in population and economic environment, emerging markets are of an ever growing importance. They give multinationals the opportunity to reach larger target markets and offer the ability to reduce
19 production costs. The existence and emergence of these new markets will inevitably influence the strategies of multinational companies (Enderwick, 2009). As a starting point, Wright, Filatotchev, Hoskisson, & Peng ( 2005) have shown that MNCs in different situations should ask themselves different questions regarding the appropriate strategy to follow. They make a distinction between firms from developed economies entering emerging economies, domestic firms competing within emerging economies, firms from emerging economies entering other economies and firms from emerging economies entering developed economies and showed that different strategies fit their specific situation. The most important note regarding the issue is that the success of strategic initiatives targeting emerging markets is enhanced by recognizing that developed market patterns of economic development may not occur in these emerging business environments (London & Hart, 2004). When firms want to internationalize and enter different (emerging) markets, they need to possess strategies that are internationally usable. They could, for instance, draw upon locational advantages in their home market and make them internationally competitive. But, to be able to effectively do so, they need to understand the non-home markets they want to enter (Verbeke, 2009). London & Hart (2004) show that those strategies that are based on leveraging the strengths of the existing (emerging) market environment outperform those strategies that focus on overcoming weaknesses.
Understanding emerging markets is not easy or naturally. Emerging markets are not uniformly defined in previous research; the term “emerging markets” has been inconsistent in the marketing literature and practice (Steenkamp & Burgess, 2002). The term was invented and introduced by van Agtmael (1981), a World Bank employee. Both terms emerging markets and emerging economies are used in literature and are often used to indicate the same emerging countries or regions. To further specify, The United Nations actually defined a measure for emerging countries. They do not divide the worlds countries in two categories, developed or emerging, but distinguish between four categories of countries, which are based on their score on the human development index. This index is a quantitative measure of the average achievements of a country on three basic dimensions of human development: first, life expectancy at birth, second, adult literacy rate and educational attainment, and third, GDP per capita at purchasing power parity (PPP). They define countries that score low or medium on these dimensions as emerging countries and countries that score high as developed ones. The World Bank (2013) also has developed a classification of countries. It focuses on the available monetary resources in a country, the gross national income per capita (GNI). Emerging countries are defined as countries with low or middle income, while higher income countries are considered developed. This measure shows some overlap with the one of the United nations, but is easier to use because of the single variable. Furthermore, Arnold and Quelch (1998) identified three
20 characteristics of an emerging country: “the relative pace of economic development and growth, “the absolute level of economic development, and “the system of market governance. The first one is related to economic growth and is measured by means of gross domestic product (GDP) growth rate. Countries are categorized as emerging when their GDP growth rates is larger than five percent. The second characteristic is the level of economic development. This is measured in GDP per capita and relates to the wealth of the country’s population and the level of industrial and commercial development. The third and final characteristic is the country’s market governance, which incorporates how the governments control resources, the level of free-market activity, the regulatory environment and the stability of the market system. Hoskisson (2000) summarizes these definitions as follows and defines an emerging country as ‘‘low-income, rapid-growth countries that use economic liberalization as their primary engine for growth’’.
Developed markets are defined more uniformly and mostly as all other, not emerging, countries. The definition of the world bank is the most widely used. To be categorized as a developed country, first, the country's GDP per capita has to exceed $10,000 and second, the country has to follow a stable and responsible macroeconomic policy (World Bank, 2013).
Most current literature compares countries and not economies when looking at the level of development. Therefore, according to the definitions given above, the following examples are characterized as emerging countries. They are generally situated in Eastern Europe, South America, Asia, Africa and the Middle East: Brazil, China, Colombia, India, Indonesia, Morocco, Mexico, Poland, Russia, South Africa, South Korea, Taiwan, Thailand, United Arab Emirates and Venezuela. Countries that are defined as developed are mainly found in Western Europe, North America and South-East Asia. Some examples are Australia, Canada, France, Germany, Hong Kong, The Netherlands, South Korea, United Kingdom and the United States of America.
Emerging markets differ in various ways from developed markets. They deviate in terms of socioeconomic, demographic, cultural, and regulative conditions from the assumptions of theories that are characteristic of the developed world and question our traditional understanding of constructs and their relations (Wright, Filatotchev, Hoskisson, & Peng, 2005). They are increasingly seen as a diverse set of business, cultural, economic, financial, institutional, legal, political and social environments which give researchers the opportunity to test, reassess and renew received wisdoms about how the business world works and to make new discoveries. Companies in emerging countries often encounter problems regarding the enforcement of regulations, because there is a lack of governmental actions and corruption and in general a lack of an effective and transparent law system
21 (Child & Tsai, 2005). Emerging markets are therefore ‘shaped’ by various institutions that determine ‘’the rules of the game’’. The lack of macroeconomic stabilization, legal infrastructures, effective corporate governance, the occurrence of regular political and economic shocks have significantly increased the uncertainty and risk encountered by domestic and foreign MNCs. This creates an important impact on the strategies that are used by these MNCs. Because of this environment, the strategy and performance of emerging market companies often can be derived from these various institutions (Hoskisson, 2000). Some of the consequences of these conditions are that companies rather do business and establish a relationship with companies from developed countries than from emerging countries, because of trust and uncertainty issues, but also because of the impression that this yields higher quality products and technology (Stopford, 1998).
As well as experiencing several disadvantages, companies from emerging markets also have advantages in competing with developed market companies. They are better able to deal with a weak institutional environment with its political instability, insufficient corporate governance and underdeveloped market mechanisms that are character to emerging countries (Ghemawat and Khanna, 1998). Developed market multinationals may find it difficult to enter emerging countries, because they face a different, sometimes less developed, infrastructure and inefficient distribution networks. Finally, these emerging country companies are more familiar with the preferences of their consumers than developed market companies, since the consumers differ in their perception and behavior (Dawar and Frost, 1999).
These differences in emerging and developed markets support the view of, among others, Rugman (2001) and Verbeke (2009) that companies should be careful with using a global strategy, but that their strategies in emerging economies are, or at least should be, different than strategies in developed economies. MNCs are encouraged to learn about the different markets and asked to incorporate the differences among markets in their strategies, in order to exploit advantages or to overcome disadvantages (Enderwick, 2009). With today sustainability being part of most MNCs strategy, this raises the question whether these sustainability strategies are globally applicable and what its effect on the opinion of consumers and other stakeholders will be.
So, an interesting topic that has to do with emerging and developed markets, is the behavior of the consumers in those markets. Since emerging markets are increasingly growing their share in the world consumption, there consumers are at least as important as those from developed countries. When companies become more global, they must have a complete understanding of attitudinal and behavioral characteristics of emerging consumers markets, because their knowledge about
22 consumers in developed markets might not be useful when targeting consumers in emerging markets and vice versa (Essoussi, 2007). The earlier mentioned opportunity of consumer segmentation, can help order consumers in terms of similar cultures, shared sets of consumption-related symbols, such as product categories, brands and consumption activities, that are meaningful to these consumers (Alden et al, 1999). As mentioned by Dawar and Frost (1999), consumers in developed markets are different than consumers in emerging markets. In general, consumers from developed markets show a strong brand loyalty to products from developed countries firms, because they believe that these products are of a higher quality. They see emerging markets products as inferior. On the opposite side, consumers from emerging markets are poor, have income disparities and income flow variability and have different preferences than their developed counterparts. They are challenged by severe economic and educational disadvantages. Many consumers may have probably never had a job and some are even illiterate. Also, consumers in emerging countries intentionally shop for quality goods but are often not familiar with product category attributes and benefits (Steenkamp & Burgess, 2002) These consumers are unlikely to respond to marketing programs transplanted from developed markets (Dawar & Chattopadhyay, 2002).
In the following section, this literature review will be used to develop a theoretical framework and propose three hypotheses. These hypotheses will combine the described literature and research on the topics of sustainability, brand value and emerging and developed markets and this way will contribute to research by addressing unexamined interfaces.
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3. Theoretical framework and hypotheses
The triple bottom-line of economic prosperity, environmental quality and social justice is increasingly being considered by MNCs. A KPMG (2005) survey among MNCS, showed that having a good reputation or brand was one of the main drivers of corporate responsibility. Does it pay-off to address not only economic issues, but also environmental and social ones? Factors such as reputation and trust of a company are created by signals that reach their consumers and other stakeholders. Doing good, in terms of social and environmental initiatives, creates positive signals that, when they reach the right receivers, may enhance brand value. First, Greeno and Robinson (1992) stated that environmental performance will be an increasingly important factor, in the same way as financial performance always has been. Environmental performance is an important component of a firm’s reputation and that it is an efficient way of attaining sustainable competitive advantage, because this reputation increases revenues and overall economic performance (Miles & Covin, 2000). Literature on the relationship between a firms environmental performance and financial performance has emphasized two different measures. First, the long-term comparison of financial and environmental performance and second, the effect of environmental performance on the market value of the firm (Konar & Cohen, 2001). Second, other research has focused on the benefits of corporate social performance, in terms of effects on corporate financial performance, and found mostly positive, but also some negative results (Melo & Galan, 2007). Consensus is that effects were not directly caused by the social performance, but through factors such as brand image or reputation. Those companies that are perceived to have a good reputation are better able to sustain superior profits outcomes over time (Roberts and Dowling, 2002). By satisfying stakeholders, social and environmental initiatives lead to enhanced performance, because it creates intangible and inimitable assets, such as for example a brand, that creates a competitive advantage that leads to enhanced financial performance. Another topic is that of the avoidance of social and environmental legislation, which will cause companies to be enforced to follow these legislations by law, resulting in a damaged reputation. This could end in serious financial costs, because of environmental penalties or the violation of social obligation (Orlitzky and Benjamin, 2001; Porter and Kramer, 2006). Sustainability therefore is a serious consideration for MNCs in developing their strategies, because it helps to establish legitimacy, reputation and image, which enhances the perception of consumers of the company’s brand, which results in a sustainable competitive advantage (Werther, 2005). The potential value that is created through successful sustainability strategies and its effective communication is a promising benefit for MNCs engaging in social and environmental initiatives. It is an opportunity to affect the perceptions and opinions of consumers and other stakeholders through
24 the reputational advantages and risks that are associated with sustainability, which on their turn might affect the brand of the MNC.
Therefore, as opposed to conventional measures of corporate sustainability pay-off, the Brand Value is used:
H1 There is a positive effect of Corporate Sustainability Performance on Brand Value
With the trend of increased globalization and the growth of emerging markets, researchers and managers have already had plenty of food for thought. Consensus however, is not yet there. Some research shows that a global strategy is the key to competitive advantage, by means of benefits like economies of scale or standardization (Levitt, 1983). Other research emphasizes the need for regional strategies, because markets and consumers are different and require adaptation (Rugman, 2001). When it comes to emerging markets, literature has shown that emerging market companies have different strategies that their developed equivalents, caused by different business, legal and governmental environments (Hoskisson, 2000). As a consequence, MNCs should yet be aware of the differences between markets or countries they are active in when creating and implementing their strategy. Literature has compared corporate social responsibility and corporate sustainability for developed and emerging markets to some extent. In these markets, leading companies show a high level of comparability, they have a similar approach to the two issues. Nevertheless, corporate responsibility is less embedded, although more than commonly thought, in the strategies of companies from emerging countries than in those from developed countries. Some companies from emerging markets engage a great deal in environmental and social initiatives, while there are a lot others that do little or nothing (Baskin, 2006). These divergences presumably show that companies in these countries face more varying, or better expressed, more non-committal business and environmental circumstances. This strokes with the fact that emerging countries are different from developed countries in terms of social, legal, cultural and regulative conditions (Wright, Filatotchev, Hoskisson, &Peng, 2005). Companies in developed and emerging markets are not subject to the same pressure from stakeholders to act sustainable. In emerging countries, there are less legal and political motives to operate socially and environmentally responsible. It can be expected that companies from emerging countries, facing a lack of corporate governance and institutional compliance, do not or are not able to employ the same sustainability initiatives and strategies as developed country companies (Chvatalova et al., 2011). However, this pressure is increasing, with the entrance of emerging countries into the World Trade Organization. This changed the fact that sustainability was not a required issue in the past and that emerging country companies did not have
25 to defend a certain global reputation, because of less globalization and internationalization (Zhu & Sarkis, 2006). This research partly focusses on the question, when addressing sustainability, which literature stream is followed by companies that are struggling with the globalization or regionalization problem. Given the different, less stimulating incentives companies from developed countries face, the fact that their economies are still growing and developing and that sustainability only recently got on the agenda of MNCs, it is expected that companies in emerging economies focus on other topics than sustainability, such as growth and innovation. Hence the following hypothesis, to assess whether companies from emerging countries are less actively, effectively and efficiently pursuing sustainability strategies:
H2 The level of development of a country is positively related to CSP
Following hypothesis 1 and 2, with proposed that CSP has a positive effect on the brand value of MNCs and that CSP is more present in developed countries, the question if sustainability is perceived different by consumers and other stakeholders in emerging countries is raised. Since the environmental factors that MNCs in emerging markets face are different than those in developed countries, this might also go for the companies stakeholders and customers. With increased internationalization, it is an interesting question to know in what countries or markets a successful sustainability strategy actually creates value and pays off.
It seems that there is different stakeholder pressure in emerging and developed countries when it comes to sustainability. Stakeholders of companies in emerging economies have a preference for economic growth and contribute little to the fight against environmental harm (Eberlein & Matten, 2009). For example, in the rapidly changing environment of emerging markets, governments often change legislation and regulation regarding sustainability (Bromley, 2007). Also, since employees are often poor, they prefer fair wages above social conditions (Dawar & Frost, 1999). On the other side, stakeholders from companies in developed countries are an important factor for MNCs. Many stakeholders can be involved in strategy decision-making processes, such as governments, consumers and suppliers are a valuable source of input for MNCs struggling with sustainability (Reuter et al., 2010). For example, developed country governments like companies that engage in CSR (Eweje, 2011). Here, sustainability strategies can create value for all stakeholders and this causes companies to take stakeholders interests at the base of their reasoning with regard to environmental, social and economic questions (Parmar et al, 2010). These differences in pressure might indicate that stakeholders opinion is influenced in different ways in emerging and developed markets.
26 According to the fact that sustainability is pressurized differently by stakeholders and the assumption that it is exercised differently in emerging and developed countries, it might also be perceived different by consumers, the largest group of opinion makers. Consumers in developed markets face continuing discussions about corporate responsibility and sustainability (Eweje, 2011), while consumers from emerging markets have other issues on their mind, such as price (Dawar and Frost, 1999). Also, among consumers from both emerging and developed countries, the perception lives that products from emerging country companies are of inferior quality (Sharma, 2011). Thus, the people that generate money for companies might have different attitudes towards sustainability or might have never even thought about the issue, therefore affecting the performance of sustainability oriented companies.
Stakeholders, and especially consumers are at the base of brand value, by increasing the brand equity (Keller, 2003). It is the MNCs task, whenever situated in an emerging or developed country, to leverage this equity as best as possible to create brand value. Hence, by taking the above described situational factors into account, emerging or developed market conditions moderate the effect of corporate sustainability performance on brand value:
H3 The more developed a country, the more positive the effect of Corporate Sustainability
Performance on brand value
These three hypotheses result in the following conceptual framework:
27 Figure 1. Theoretical framework
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4. Methodology
In this chapter, the methodology of this research is explained, including the research strategy and approach. At first, the research design is given, followed by a description of the sample and the method of data collection. Then, the different variables and their sources are proposed and their use is explained. Finally, the different methods of data analysis that are used in this research are elaborated.
4.1 Research design
The study will be databased research. Given the nature of the research question, it seems obvious to conduct quantitative research. By doing so, as many companies as possible can be included in the research and reliable and objective research that is usable in generalizing findings is produced. The research is deductive, since there are hypotheses tested but no new theories generated. The goal of the study is to find an effect of Corporate Sustainability Performance on the Brand Value of a firm and to see whether this effect is different in emerging and developed countries. Corporate sustainability performance is the independent variable and brand value is the dependent variable. Furthermore, emerging and developed country conditions are added as moderating variables. These moderating variables will also be analyzed as possible antecedents of CSP. The emerging and developed market conditions that are used are GDP/capita and GDP real growth rate. They are both commonly used measures of the same thing: the development of a country. The two conditions will be measured separately, to get a better idea of the specific factors that cause differences in impact of CSP on brand value in emerging/developed countries and because they are working opposite: an emerging country has a low GDP/Capita, but a high GDP growth rate. Finally, control variables are firm size and industry. The data was obtained through multiple validated secondary databases and is combined to one dataset. This dataset combines data from the Dow Jones Sustainability Index (DJSI) as its independent variable and data from Brandirectory’s list of 500 Best Global Brands as the dependent variable. As the data for the moderating variables emerging and developed countries, data from the IMF, World Bank and CIA is used and for the control variables Compustat is used. The model will be tested with correlation and regression analyses in order to establish possible relations between the variables.
4.2 Sample
By merging the data of the various databases, the Brandirectory’s Top 500 Global Brands, the Dow Jones Sustainability Index and the Compustat database, a sample of 136 firms was created. This is a
