1.
Md Afnan Alam
ID
– Research Scholar, Department of Commerce, University of North Bengal, Raja Rammohunpur, Darjeeling, West Bengal, India.
2.
Soumitra Sarkar
– Associate Professor, Department of Commerce, University of North Bengal, Raja Rammohunpur, Darjeeling, West Bengal, India.
Abstract
In today’s competitive market, sustainability is a crucial
factor for companies, be it financial, environmental,
or social. The demand for sustainability is largely
driven by shifts in consumer preference. The
common assumption that investors focus solely
on financial sustainability is strongly challenged by
growing awareness of social and environmental
sustainability. This study seeks to examine the effect
of financial sustainability on environmental and social
sustainability. Data were collected from companies
included in the BSE SENSEX index and BSE 100ESG
index for the last five financial years, ranging from
2018-19 to 2022-23. Data analysis was carried out
using Panel Logistic Regression. Predictors used to
test the impact include various financial and market
metrics such as earnings per share (EPS), Tobin’s
Q, return on total assets (ROA), free cash flow
(FCF), return on capital employed (ROCE), priceto-
earnings (PE) ratio, and promoters’ shareholding
pattern. Findings suggest that ROA has a negative
and significant impact on sustainability compliance.
Further, it is evident that although sustainability has
gained recognition as an important topic among
researchers, academicians, and environmentalists,
corporate sustainability does not necessarily depend
on financial or market performance.
Keywords Sustainability, Panel Logistic Regression, ESG, ROA, Tobin’s Q