1. EXECUTIVE SUMMARY

Companies today face the challenges of adopting proper sustainability strategies and practices to effectively respond to social, ethical, environmental and governance issues while creating sustainable financial performance and value for their shareholders. The goal of firm value maximization under business sustainability can be achieved when the interests of all stakeholders are considered. The main focus is on long-term shareholder value creation while considering trade-offs among other apparently competing and often conflicting interests of all stakeholders including society, creditors, employees, suppliers, customers and the environment. The relative importance of the five dimensions—economic, governance, social, ethical and environmental (EGSEE)—of sustainability performance with respect to each other and their contribution to overall firm value creation is affected by whether these sustainability performance dimensions are viewed as competing with, conflicting with or complementing each other and what sustainability theory or theories are applied to define tensions among EGSEE sustainability performance dimensions. This chapter examines several principles, theories and standards relevant to all five EGSEE dimensions of sustainability performance in explaining the tensions between them as well as the associated risk. This chapter also presents sustainability research and education.

2. INTRODUCTION

Business sustainability has been debated in the literature and has changed business organizations' strategies and practices in focusing on long-term and multi-dimensional sustainability performance. Corporations' primary goals have refocused from maximizing profit to increasing shareholder wealth. Now, in light of the moves toward business sustainability worldwide, those goals are shifting toward creating shared value for all stakeholders including shareholders. Companies today face the challenges of adopting proper business models and sustainable supply chain management strategies and practices to effectively respond to social, ethical, environmental and governance issues while creating sustainable financial performance and value for their shareholders. Scholars also attempt to adopt appropriate sustainability theories to explain the relationship between financial economic sustainability performance and non-financial governance, social, ethical and environmental sustainability performance.

This chapter addresses the agency/shareholder, stakeholder, legitimacy, signaling, institutional and stewardship theories and applies various quality control, environmental, social and governance standards to explain the integrated and interrelated dimensions of sustainability performance and their relevance to shared value creation.¹ These theories and standards suggest that companies should focus on the key measures of sustainable performance such as operational efficiency, supply chain management, customer satisfaction, talent management and innovation. These measures are derived from the internal factors of strategy, risk profile, strengths and weaknesses and corporate culture as well as the external factors of reputation, technology, competition, globalization and utilization of natural resources. Companies should use a principles-based approach in integrating financial and non-financial sustainability information into their business model, from purchasing and inbound logistics, production design and manufacturing process, to distribution and outbound logistics.

3. INSTITUTIONAL BACKGROUND

Conceptually, there are two distinct views on why a firm should focus on both financial economic sustainability performance (ESP) and non-financial governance, social, ethical and environmental (GSEE) sustainability performance. Practically, the ethics component can be integrated into other financial and non-financial dimensions of sustainability performance. One view is that a firm exists solely to maximize profits and create value for its shareholders within the realm of law and morality. In this context, a firm's objective is to improve ESP sustainability performance and to engage in GSEE sustainability initiatives merely to benefit its public image, prevent government intervention and/or gain government favor, improve its corporate governance effectiveness, obtain industry leadership, improve reputation with customers and society or improve market share. Under this view, any investment in non-financial GSEE is considered an expense that reduces a firm's bottom line and thus negatively affects shareholder wealth.

Another view is that a firm is the property of its owners and not stakeholders. As such, the owners have the right to decide how their property will be handled; as either for profit (ESP-focused), for social good (GSEE-focused) or for both, if desired. In this context, any engagement in non-financial GSEE sustainability performance is intended to improve the bottom line earnings based on the perception that a firm with more effective corporate governance measures, that conducts its business ethically and that takes corporate social responsibility (CSR) and environmental initiatives, is better off financially in the long term. Under this view, any expenditures pertaining to non-financial GSEE are considered as an investment that can provide potential returns on investment and ultimately increase long-term financial earnings.

In recent years, however, there has been a move toward a middle ground view of “doing well by doing good” by focusing on both financial ESP and non-financial GSEE sustainability performance. This view is gaining momentum worldwide and is promoted throughout this book. Investors now seek investments that are aligned with their social values (value alignment), for example, by owning stocks only in companies whose activities are consistent with the investor's moral and/or social values. Other investors may want to invest in portfolio companies that can create more social value (social value creation). Recently there is a trend toward impact investing, which started in North America and Europe. Impact investing is defined as accepting a lower return on investment in companies that “do well and do good” by focusing on GSEE performance.² This trend is currently being advocated in Hong Kong and Asia. Many private wealth arms of global banks such as Bank of America's Private Wealth Management and BNP are developing products focusing on impact investors. With impact investing, securing the financial return is not the sole objective of investors, as they consider social and environmental impacts as well.³ Thus, impact investing is defined as an investment with financial return as well as non-financial impacts on society and environment.

Theoretically, management engagement in GSEE activities, performance and disclosure can be viewed as value increasing or value decreasing by investors. On the one hand, companies that effectively manage their business sustainability, improve GSEE performance, enhance their reputation, fulfill their social responsibility and promote a corporate culture of integrity and competency can be financially sustainable in the long term. On the other hand, companies can only survive and generate sustainable performance when they generate profits and cash which in turn are used to invest in social and environmental initiatives. An intensive and yet inconclusive debate has taken place about whether GSEE programs constitute a legitimate activity for corporations to engage in.⁴ The costs of these programs are immediate and tangible but the related benefits may not be realized in the short to medium term and outcomes are often not easily quantifiable (e.g. CSR initiatives). Sustainability disclosures on GSEE are typically considered as externalities beyond the disclosures of ESP and can be viewed positively or negatively by investors and other market participants. Examples of positive externalities are diversity and independence of the board of directors, majority voting by shareholders, executive compensation that is linked to performance, pay for performance, environmental initiatives regarding climate change and greenhouse gas emissions, high-quality and safe products, customer satisfaction, ethical workplaces, job creation and fair employment. Examples of negative externalities are chief executive officer (CEO) duality where the position of the CEO and the chair of the board of directors is the same, excessive risk-taking by executives, natural resource depletion, pollution, aggressive management and human rights abuses. These positive (negative) externalities have been documented to have favorable (unfavorable) effects on the firm's cost of capital and thus its market value.⁵ Sustainability theories discussed in the next section are intended to explain the possible tension among the five EGSEE dimensions of sustainability performance, in particular the tension between financial ESP and non-financial GSEE dimensions.

4. SUSTAINABILITY PRINCIPLES

As business sustainability is gaining increasing attention and recognition as a strategic imperative and being integrated into corporate culture and business environment, its principles are being defined by several professional organizations. The five principles of sustainability, developed based on the definition of sustainability as “a dynamic equilibrium in the process of interaction between a population and the caring capacity of its environment…,” provide guidelines for public companies to effectively manage the social, environmental and financial aspects of their business.⁶ The five sustainability principles as defined by the Brundtland Commission are the material, economic, life, social and spiritual domains.⁷

1. The Material Domain: This principle suggests continuous flow of resources through and within the economy as permitted by physical laws and provides justifications for regulating the flow of materials and energy. Policy and operational implications of this principle are concerned with the promotion of highest resource productivity, recycling of non-regenerative resources and regenerating energy resources that underlie existence.
2. The Economic Domain: This principle posits that there exist economic and accounting guiding frameworks for managing wealth and aligning economic performance with the planet's ecological processes. Policy and operational implications of this principle are concerned with the effective management of all capitals, including natural, financial, manufacturing, human and social, with a focus on the wellbeing of all stakeholders. It also relies on market mechanisms and smart regulation for the proper allocation of resources and capital assets.
3. The Domain of Life: This principle promotes diversity of all forms of life as the basis for appropriate behavior in the biosphere. Policy and operational implications of this principle are concerned with accountability and stewardship, responsibility for the planet and conservative use of scarce resources.
4. The Social Domain: This principle suggests the basis for providing the maximum degree of freedom and self-realization for all humans and their social interactions. Policy and operational implications of this principle are concerned with the promotion of tolerance as a foundation for social interactions, good citizenship, democratic governance, equitable and fair access to resources, sustainability literacy and sustainability enhancing concepts.
5. The Spiritual Domain: This principle advocates the recognition of the necessary attitudinal orientation as a need for a universal code of ethics. Policy and operational implications of this principle are concerned with the understanding of humanity's unique function in the universe, the creation of synergy in human endeavors and linking the inner transformation of individuals to transformation in society.

The United Nations Global Compact has established 10 sustainability principles and more than 8,000 companies worldwide have adopted and integrated these principles into their strategic planning, decisions and operations.⁸ These 10 sustainability principles are classified into four general categories of human rights, labor, environment and anti-corruption as summarized in Exhibit 2.1, and are relevant to all five EGSEE dimensions of sustainability performance. The ultimate success of business organizations should be measured in terms of their ability and willingness to achieve all five EGSEE dimensions of sustainability performance by adopting these principles of sustainability. These sustainability principles should assist business organizations to:

• Focus on creating sustainable performance that benefits humans, society and the environment.
• Adopt sustainability as an integrated component of their mission and recognize that sustainability integrates social, economic, governance, ethical, environmental and cultural interactions.
• Encourage the discussion of sustainability concepts throughout the company.
• Commit to ongoing assessments of the company's progress toward sustainability.
• Commit to the development and implementation of policies and operating procedures that promote the fulfillment of these principles.

These principles collectively suggest that sustainability enables businesses to meet the needs of the current generation without compromising the needs of future generations. A combination of these sustainability principles should be used as the foundation and guidelines for business organizations in transforming business sustainability from a greenwashing exercise into a strategic imperative of integrating business environment and corporate culture. Specifically, these principles should be viewed as foundations for the development of the sustainability theories explained in the following section.

5. SUSTAINABILITY THEORIES

The concept of sustainability performance suggests that a firm must extend its focus beyond maximizing short-term shareholder profit by considering the impact of its operations on all stakeholders including the community, society and the environment.¹⁰ Several theories including shareholder/agency, stakeholder, legitimacy, signaling/disclosure, institutional and stewardship help to explain the interrelated EGSEE dimensions of sustainability performance and their integrated link to business models and corporate culture in creating shared value for all stakeholders.¹¹ This section presents these theories and their implications for business sustainability practice, education, research and standards.

6. SUSTAINABILITY STANDARDS

Sustainable business for organizations means not only providing products and services that satisfy the customer and doing so without jeopardizing the environment, but also operating in a socially responsible manner. The business literature suggests the use of sustainability standards developed by the International Organization for Standardization (ISO) in measuring both financial ESP and non-financial GSEE sustainability performance along with preparation of integrated sustainability reporting and obtaining assurance on sustainability performance reports.²⁶ The ISO standards and certifications can promote compliance with environmental regulations and social standards. Therefore, the ISO enables a consensus to be reached on solutions that meet both the requirements of businesses and the broader needs of society. Pressure to do so comes from customers, consumers, governments, associations and the public at large. At the same time, far-sighted organizational leaders recognize that lasting success must be built on credible business practices and the prevention of activities such as fraudulent accounting and labor exploitation. A comprehensive set of ISO standards is needed to explain the link between sustainability theories and all five dimensions of sustainability performance. Several standards of the ISO are relevant to the five EGSEE dimensions of sustainability performance.²⁷ Specifically, ISO 9000 on quality control, ISO 14000 on environmental programs, ISO 20120 on sustainability events, ISO 26000 on CSR, ISO 27001 on information security and ISO 31000 on risk assessment are relevant.²⁸

7. GLOBAL IMPLICATIONS OF SUSTAINABILITY PRINCIPLES, THEORIES AND STANDARDS

Business organizations worldwide are now recognizing the importance of sustainability performance and the link between the financial ESP and the non-financial GSEE dimensions of sustainability performance. Justifications for business sustainability are moral obligation, social responsibility, maintaining a good reputation, ensuring sustainability, environmental conscientious, license to operate and creating stakeholder value. Social performance can be viewed by management as non-value adding and non-essential activities that may not necessarily increase shareholder value, but should improve the image and reputation of the company as a socially responsible citizen. Sustainability performance which can be driven by the signaling and legitimacy incentives measures how well a company translates its social goals into practice. Sustainability performance can be achieved from many activities focusing on producing and delivering high-quality products and services that are not detrimental to society. The goal is to become a positive contributor to the sustainability of the planet and to improve employee health and wellbeing beyond compliance with applicable laws, regulations, standards and common practices.

In creating shared value for all stakeholders, corporations identify the potential social, environmental, governance and ethical issues of concern and integrate them into their strategic planning and supply chain management practices. There are many reasons why a company should integrate sustainability performance to its corporate culture, business environment and supply chain management. These factors include pressure from the labor movement, the development of moral values and social standards, the development of business education and change in public opinion about the role of business, environmental matters, governance and ethical scandals. Companies which are, or aspire to be, leaders in sustainability are challenged by rising public expectations, increasing innovation, continuous quality improvement, effective governance measures, high standards of ethics and integrity, and heightened social and environmental problems.

Globalization created incentives and opportunities for business organizations and their stakeholders and executives to influence their business sustainability initiatives and strategies. Corporations can choose from a variety of sustainability initiatives with regard to the scope, extent and type of sustainability strategies, focusing on different issues, functions and areas. The sustainability program can be designed to minimize conflicts between corporations and society caused by differences between private and social costs and benefits, and to align corporate goals with those of society. Examples of conflicts between corporations and society are related to environmental issues such as pollution, acid rain and global warming, and issues such as wages paid by multi-national corporations in poor countries and child labor in developing countries. Corporate governance measures which include the rules, regulations and best practices of sustainability programs can raise companies' awareness of the social costs and benefits of their business activities. The benefits of a sustainability program include addressing environmental matters, reducing waste, reducing risk, improving relations with society and discouraging regulatory actions. Sustainability programs enable corporations to take proper actions to promote social good and advance social goals above and beyond creating shareholder value or complying with applicable laws and regulations (e.g., anti-pollution). Sustainability programs should also promote a set of voluntary actions that advance the social good and go beyond the company's obligation to its various stakeholders. Non-financial sustainability activities should be measured and disclosed in the same way that financial activities are.

Four implications of sustainability theories and standards are presented in this chapter for businesses to try to integrate the EGSEE dimensions of sustainability performance into their strategic decisions and actions. First, the business sustainability framework and its five EGSEE sustainability performance dimensions are driven by and built on the stakeholder theory, which is the process of creating shared value for all stakeholders. Second, the main goal and objective for business organizations is to maximize firm value. The goal of firm value maximization can be achieved under business sustainability by protecting the interests of all stakeholders including investors, creditors, suppliers, customers, employees, the environment and society. Business sustainability promotes the achievement of long-term financial performance that generates enduring future cash flows for investors to maximize long-term share value and thus overall firm value. Focusing on GSEE sustainability performance enables the achievement of long-term firm value maximization by creating value for shareholders while meeting the claims of other stakeholders. The third theme is the time horizon of balancing short-term and long-term performance in all five EGSEE dimensions of sustainability performance. The final theme is the multi-dimensional nature of sustainability performance in all EGSEE areas. Multi-dimensional EGSEE sustainability performance is interrelated and should be integrated to supply chain management.

The International Business Council of the World Economic Forum (WEF, 2018) developed a new paradigm for business sustainability which suggests a roadmap for corporate governance partnership between corporations and their boards of directors and investors, particularly shareholders, to achieve business sustainability performance of long-term investment and growth.²⁹ The new paradigm focuses on best practices of business sustainability and corporate governance in forging a meaningful, impactful and successful private sector solution in advancing business sustainability. The new paradigm suggests focusing on the achievement of long-term performance that generates shared value for all stakeholders. It is expected that the new paradigm will encourage:³⁰

1. Public companies and their stakeholders, particularly investors, to support tax policies that enable and promote long-term investment.
2. Public companies and their stakeholders, particularly investors, to work toward creating long-term sustainable performance.
3. Close working relationships between government and corporations to obviate the need for regulation and legislation to enforce a longer-term approach.

8. SUSTAINABILITY RESEARCH

Much anecdotal evidence and many empirical findings suggest a positive relationship between financial ESP and non-financial GSEE sustainability performance for companies with strong commitment to governance, social and environmental efforts.³¹ All five EGSEE dimensions of sustainability performance are important to stakeholders. However, ESP is regarded as the main objective for business organizations primarily because companies have to do well financially in order to do good for society.³² A 2013 KPMG report suggests the key measures of ESP as being financial cash flows, earnings and return on investment, non-financial operational efficiency, customer satisfaction, talent management, innovation reputation, technology, competition, globalization and utilization of natural resources.³³ Prior research identifies the six measures of ESP as (1) average return on equity for the current year (2) sales scaled by total assets (3) sales growth scaled by total assets (4) ratio of market to book value of equity (5) research and development expenses scaled by total assets and (6) advertising expenses scaled by total assets.³⁴

Early sustainability-related research with a primary focus on CSR addressed the rationale for CSR expenditures and the relationship between CSR activities and firm performance.³⁵ In compliance with stakeholder theory, CSR/GSEE activities are viewed as an integral component of a firm's mission of protecting the interests of all stakeholders including society and the environment and as such GSEE expenditures are regarded as investments.³⁶ Much of the academic literature has focused on CSR with its drivers, performance and impacts on financial operations, earnings and market performance. The extant CSR literature, as reviewed below, suggests that CSR performance is associated with financial performance, how it affects the cost of capital, improves firms' valuation, impacts stock price crash risk, discloses private information, reduces exposure to risk of conflicts with stakeholders, reduces earnings management and discourages stock short selling and tax avoidance. Sustainability performance and reporting has been a topic of great interest in the supply chain management literature.

Five streams of related research address the various aspects of sustainability. The first stream of research consists of several papers³⁷ documenting the relevance of green and social initiatives to business by investigating whether it pays to be green and socially responsible and how business organizations should deal with environmental and social issues. This stream of research focuses on the relevance of social and environmental issues to firms' entire value chains from inbound and outbound logistics to processes and operations, finished products, customer interface, distribution channels and customer services.

The second stream of research discusses the benefits of sustainability and whether sustainability investments in environmental and social issues pay off in terms of customers' perception of products and services. This stream of research³⁸ often uses the term “sustainable supply chain management” (SSCM) to highlight managerial decisions and actions in achieving financial performance (management of materials, capital flows, production process and information) and other activities in dealing with environmental and social issues and their comparison with best practices in supply chain management.

The third stream of research discusses the theoretical framework for business sustainability and its implications for sustainability performance, reporting and assurance. These studies³⁹ suggest the use of multiple theories in relating sustainability performance to supply chain management and other managerial strategies.

The fourth stream of research pertains to the role and use of ISO standards and certifications in improving the quantity and quality of sustainability reporting and assurance. By focusing on the implementation of certification under ISO 14000 environmental standards, these studies suggest that such certification can promote compliance with environmental regulations and social standards.⁴⁰

These four streams of related research use both conventional financial key performance indicators (KPIs) such as earnings and return on investment and conceptualization KPIs such as social and environmental performance in linking sustainability performance to financial performance and supply chain management.⁴¹ Prior research, while examining several aspects of sustainability performance and reporting assurance, has not sufficiently addressed a holistic approach to integrate all five EGSEE dimensions of sustainability performance into firms' entire value chains from strategic planning by top-level management to purchasing and inbound logistics, production design and manufacturing process, distribution outbound logistics and marketing and customer services.

The final stream of research deals with the link between financial and non-financial GSEE dimensions of sustainability performance and the impact on firms' financial and market performance. Several studies find that corporations that initiate CSR disclosure programs typically exhibit better financial and market performance as evidenced by reductions in their costs of equity and increases in analyst coverage in the following year.⁴² Other studies find that sustainability may result in improved firm performance as proxied by the associations between environmental supply chain practices and both accounting- and market-based financial and operational performance. Overall, these studies report a U-shaped relationship between financial and non-financial (CSR) dimensions of sustainability performance where very small and very large firms are more likely to engage in CSR activities and performance.

Taken together, these five streams of research primarily focus on environmental, social and governance (ESG) sustainability issues in an isolated fashion. These studies, while indirectly examining several aspects of business sustainability, have not sufficiently addressed a holistic approach of integrating all five EGSEE dimensions of sustainability performance into corporate culture, business model, management processes and value chains from the strategic planning of top-level management to purchasing and marketing and customer services.

Exhibit 2.2 provides a summary of a selected small sample of published articles on business sustainability and CSR-related research. Academic research reviewed in this section suggests some of the challenging key GSEE issues. They are: competition issues (the use of advertising and the arrival of new types of GSEE risk with new technology), environmental issues (climate change and regulatory changes for hazardous substances and waste), human rights (labor rights), product responsibility (access, safety, risk, disclosure labeling and packaging), bribery and corruption (financial reporting fraud, financial scandals, money laundering), respect for privacy, ensuring transparency and accountability, institutionalization of GSEE, stakeholder engagement, battle for talent, community investment, supply chain and product safety, social enterprises and poverty alleviation.

Mandatory and voluntary corporate disclosures provide vital information to the financial markets. The type and extent of voluntary disclosures have recently received considerable attention as more than 14,000 firms worldwide disclose sustainability information on various environmental, social and governance dimensions of their sustainability performance. Public companies are required to disclose a set of financial statements under the corporate mandatory disclosures regime and they also disclose other information through corporate voluntary disclosures. Looking from a macroscopic perspective at the issue of effecting widespread business sustainability practices through mandatory or voluntary schemes may give insights into how best to generate clear, concise and valuable sustainability reporting for different environments. A recent paper by Ioannou and Serafeim (2011)⁴³ seeks to ascertain how these interactions among, in this case, various countries' overall outlooks and contexts influence their leaning toward one dimension of sustainability or another. For example, the researchers found that firms in countries that encourage them to compete tend to focus less on environmental and social concerns while the same detriments are found in those countries with a majority/plurality of leftist governance. The reasons for the similarity between those two groups, disparate as the two groups may seem to be, lie in the conflicting motivations of the stakeholders in question. The paper suggests that, in the first case, the lower performance in environmental and social matters is due in large part to the increase in competitive efficiencies while the latter group's actions may be explained by higher corporate taxes and the subsequent fiscal inability to take on more CSR matters. There is a need for an active balancing of the various issues surrounding CSR by a dynamic set of regulations, guidelines, initiatives and best practices. To that end, there is a great demand for research in this area from the various perspectives of accounting, finance, economics, psychology, sociology, political science and other disciplines.

9. BUSINESS SUSTAINABILITY EDUCATION

The global investment community is holding public companies responsible and accountable for their business activities and their financial reporting process. As business schools are the main providers of professional accountants, they play important roles in preparing ethical and competent future business leaders who understand business sustainability. The public, policymakers, regulators, businesses the accounting profession and the academic community are now scrutinizing colleges and universities to explore ways by which to hold these institutions more accountable for achieving their mission in providing higher education with a relevant curriculum. Therefore, business sustainability education and research has recently been addressed by the global community and accreditation bodies. For example, the Association of Advanced Collegiate Schools of Business (AACSB) International has established an Ethics/Sustainability Resource Center which poses questions like “Do you think business schools should conduct more research on sustainability and how business can contribute to it?” on its website. All respondents as of July 17, 2012 have responded “Yes” to this question, suggesting there is an urgent need for research on sustainability.⁵⁶ The AACSB in its accrediting standards (Standard 9) identifies sustainability as a knowledge area by stating that “society is increasingly demanding that companies become more accountable for their actions, exhibit a greater sense of social responsibility and embrace more sustainable practices.”⁵⁷

The proposed integrated framework for defining the post-2015 UN development agenda suggests a vision built based on the core values of human rights, equality and sustainability for the entire world's present and future generations. Four key dimensions of the UN integrated framework are social development, economic development, environmental sustainability, and peace and security.⁵⁸ Despite progress in business sustainability education, it appears that research and education in business sustainability are fragmented, with an integrated approach covering all EGSEE dimensions lacking in many universities.

Business sustainability has been one of the top five emerging education majors in the past decade, as suggested by the Chronicle of Higher Education.⁵⁹ Sustainability is also considered one of the “hottest” and most demanding majors that lead to jobs.⁶⁰ Realizing the importance of incorporating sustainability into curriculums, academics are trying to integrate sustainability in higher education. Business sustainability practices require an integrated approach to sustainability reporting and assurance, and sustainability education demands a knowledge base in both financial ESP and non-financial GSEE sustainability performance and reporting. Despite the importance of sustainability disclosures to corporations and investors and the move toward integrated sustainability reporting and assurance, there is limited research on the integration of sustainability education into the business curriculum. Academics examine the coverage of sustainability education and find that as demand for and interest in sustainability education has increased in recent years, more business schools are planning to provide such education.⁶¹

A study was conducted in 2010 to provide a matrix of options for integrating sustainability into management and business education. It illustrates how the matrix can be used with the example of a business school in the Northeastern United States.⁶² The matrix provides a framework for discussion and a framework for action by presenting faculty, staff and administrators with options for integrating sustainability into the business curriculum. Another recent study found that as demand for and interest in sustainability education has increased, more business schools are planning to provide such education.⁶³ Business schools can provide business sustainability education with a keen focus on providing cutting-edge sustainability education in all aspects of sustainability from theories to standards and risks as well as knowledge and practices on sustainability performance, reporting and assurance. The achievement of the sustainability education goal is constrained by many factors including the availability of teaching resources, cost and benefit feasibility, quality accreditation, technology and innovation, regulatory compliance and commitment from administrators and faculty.

10. CONCLUSIONS

Business sustainability requires business organizations to focus on achieving all five EGSEE dimensions of sustainability performance by taking initiatives to advance social good beyond their own interests and compliance with applicable regulations and enhancement of shareholder wealth. Simply put, business sustainability means enhancing corporations' positive impacts and minimizing their negative effects on society as well as minimizing harm to society and the environment, and creating positive impacts on shareholders, the community, the environment, employees, customers and suppliers.

The true measure of success for corporations should be determined not only by their reported earnings but also by their governance, social responsibility, ethical behavior and environmental performance. Business sustainability has received considerable attention from policymakers, regulators and the business and investment community over the past decade and it is expected to remain the main theme for decades to come. The sustainability theories, standards, policies, programs, activities and best practices presented in this chapter should assist business organizations worldwide to integrate the five EGSEE dimensions of sustainability performance into their corporate culture, business environment, strategic decisions and supply chain management, to improve their KPIs as well as the quality of financial and non-financial sustainability information disseminated to their stakeholders.

In conclusion, sustainability principles, the theoretical framework, the practical sustainability standards, research and education suggest that:

1. Sustainability strategies should be integrated into corporate decision-making processes including strategic decisions on supply chain management in promoting the achievement of all five EGSEE dimensions of sustainability performance.
2. Companies should use a principles-based approach in integrating both financial ESP and non-financial GSEE sustainability performance information into their corporate reporting.
3. All theories including agency/shareholder, stakeholder, signaling, legitimacy, institutional and stewardship focus on key measures of sustainable performance such as operational efficiency, customer satisfaction, talent management, and innovation derived from internal factors of strategy, risk profile, strengths and weaknesses, and corporate culture as well as external factors of reputation, technology, competition, globalization and utilization of natural resources.
4. These theories help in explaining companies' objectives of creating sustainable value for shareholders while protecting the interests of other stakeholders such as creditors, employees, customers, suppliers, government and society.
5. Cutting-edge business sustainability education should stem from relevant theories and standards to promote its integration into the relevant components of business curriculums in colleges and universities.

11. CHAPTER TAKEAWAY

1. Integration of sustainability performance into business and investment analysis, supply chain management, and decision-making processes.
2. Incorporation of all five EGSEE dimensions of sustainability performance into business culture, corporate environment and business policies and practices.
3. Integration of sustainability principles into business sustainability practices in advancing the promotion of appropriate disclosure of sustainability performance.
4. Collaboration among all stakeholders to enhance the effectiveness of implementing sustainability theories and programs, and their development.
5. Periodic disclosure of both financial and non-financial KPIs relevant to sustainability performance to all stakeholders.
6. Faculty and administrators in colleges and universities should continue to add business sustainability education as a subject or topic to be integrated into relevant curriculums.
7. There are tremendous opportunities for playmakers, regulators, standard-setters, researchers, and academics to establish more effective sustainability guidelines, provide sustainability education and conduct sustainability research.