The Mediating Role of Sustainability Performance in the Relationship Between Firm Characteristics and Corporate Performance: Empirical Evidence from the Stock Exchange of Thailand
Keywords:
Sustainability, Performance, Business attributes, Stock Exchange of ThailandAbstract
The research aims to examine the direct and indirect effects of business characteristics on company performance through the sustainability performance of Thai Stock Exchange listed companies by using a partial least squares regression analysis method. Data from listed companies in all industrial sectors except the financial sector with complete sustainability performance data in the Bloomberg database, totaling 111 companies, were studied over the last three years, from 2021 to 2023, by categorizing business
characteristics into physical and financial characteristics. The results found that only financial factors had a direct positive impact on the company's performance and had no indirect influence through sustainability performance. However, sustainability performance had a direct and negative impact on the company's performance. Furthermore, the size of the firm, a control variable, had a positive impact on sustainability performance but a negative impact on corporate performance. It implies that, from 2021 to 2023, the company's performance would be positively impacted by financial characteristics and impacted adversely by sustainable performance. This research might lead investors to shift their investing priorities, focusing on companies with lower sustainability performance. As a result, the Stock Exchange of Thailand should take actions to increase investor understanding of using company sustainability performance data in investment decisions, as well as make recommendations to companies on how to communicate the importance and benefits of long-term sustainability operations to the public.
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