Small and Medium Enterprises and the Relation between Social Performance and Financial Performance: Empirical Evidence from Korea

Choi, Jun Hyeok; Kim, Saerona; Yang, Dong-Hoon

doi:10.3390/su10061816

Cited by 33 publications

(34 citation statements)

References 67 publications

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“…The implementation of a consistent KM strategy, both KM exploitation strategy and KM exploration strategy, is greatly amplified by the use of coherent PMS since the quality of decision-making increases. This is especially true for SMEs whose decision-making activities is largely influenced by the entrepreneurial decision styles and for family firms with limited professionalization on business administration [65]. This raises a managerial issue for SMEs and family businesses [152], since our findings demonstrate that the use of PMS allows SMEs to reach a higher level of economic sustainability and encourage to increase the level of professionalization in management.…”

Section: Discussionmentioning

confidence: 69%

“…If the sustainability perspective is now universally affecting the strategic and managerial efforts of every kind of organization, the different dimensions of sustainability are significantly influenced by the operational and dimensional context. According to Choi et al [65], SMEs have a different sustainability approach compared to larger firms, due to specific organizational features, particularly linked to Due to these characteristics, the authors demonstrate that the perception of low social and environmental impacts [66] and the limited impact on stakeholders cause the following two main consequences:…”

Section: Economic Sustainability In Smesmentioning

confidence: 99%

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Knowledge Management and Performance Measurement Systems for SMEs’ Economic Sustainability

et al. 2020

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This paper aims to explore the relationships between knowledge management (KM), performance measurement systems (PMSs), and small and medium enterprises’ (SMEs) economic sustainability in knowledge-intensive sectors. The literature demonstrates that SMEs are often characterized by unstructured KM approaches and limited PMS implementation, being at the same time affected by scarce profitability and financial issues. Adopting the knowledge-based view of the firm and the contingency theory of PMSs, we tested the impact of two alternative KM approaches (exploitation and exploration) on SMEs’ economic sustainability, measuring the moderating effect of PMS use (diagnostic and interactive). Through an ordinary least squares (OLS) regression of data collected for 219 Italian medium firms operating in knowledge-intensive sectors, this study provides evidence on how a specific KM approach supports the SME economic sustainability and how a consistent implementation and use of PMS amplify the relationship between KM and economic sustainability. Data analysis confirms the relevance of some key concepts of the knowledge-based view of the firm, especially the positive impact of the KM exploration approach on economic sustainability. Additionally, the paper extends empirical evidence for the PMS moderating effect on the KM–performance relationship. To the best of our knowledge, this is the first time that a study provides evidence for the relationships among KM, PMSs, and economic sustainability in the SME setting. Moreover, our findings lead to some managerial implications, especially they encourage SME entrepreneurs and managers to design a coherent KM approach and to implement an adequate PMS in order to support economic sustainability.

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Section: Discussionmentioning

confidence: 69%

Section: Economic Sustainability In Smesmentioning

confidence: 99%

Knowledge Management and Performance Measurement Systems for SMEs’ Economic Sustainability

et al. 2020

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“…In another study, this one conducted in Korea, CSR-related research has also been focused on large companies. There is a need for studies in SMEs that are comparable to research on large companies and that can compare corporate social performance with corporate financial performance [27]. Other results indicate that ethical practices have a positive impact on corporate governance, and in turn, corporate governance has a positive impact on CSR.…”

Section: Findings and Resultsmentioning

confidence: 99%

“…Due to the small size and the potential of being more flexible and innovative, SMEs can, in fact, bring novelties to good social responsibility opportunities [23,24]. This paper focuses on the sustainability theme as this theme raises different criticisms or points of view [25,26], due to its wide content, and can be interpreted as a new model of development or just a redesign of capitalism [13,24,27,28]. Increasingly, many companies are implementing sustainability-oriented strategies; for example, it was observed that Embraer has integrated the CSR practices with other existing management systems in a harmonious and mature form [9], and in the same way, several researchers [2,13,22,25,29,30] dedicate themselves to studying this theme.However, different opinions and approaches on how to deal with issues related to sustainability are perceived in this process.…”

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confidence: 99%

Evaluation of Sustainability Practices in Small and Medium-Sized Manufacturing Enterprises in Southern Brazil

et al. 2018

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The purpose of this article is to analyze the performance of small and medium-sized enterprises (SMEs) manufacturing, aiming to identify the main practices of sustainability, including the values and transparency, internal audience, environment, supplier relationships, customer and/or consumer relationships, and community relationships. In order to develop this research, a questionnaire was applied on the subject in question, through which the companies were classified as to their reality in relation to corporate social responsibility. Based on the analysis, it was observed that five of these companies obtained a score that indicates that the companies have already assimilated the associated concepts and are clear of the necessary commitments for a socially responsible action. However, given the results obtained, it is possible to conclude that there is a need to strengthen the actions to be taken with regard to corporate social responsibility, since no company has positioned itself in excellence. In addition, some suggestions for new research were identified and discussed in the analysis of the results. and preservation of the environment are also valued items by customers and should therefore be considered by companies in their production systems [11].Due to market competition and globalization, companies are crossing a wide range of changes in their business environment, adopting more ethical procedures of corporate social action to achieve long-term goals, rather than focusing on the short-term perspective of profit creation [6,12].According to [6,13], the basic purpose of business is to provide profit and figure out ways to maximize earnings. In addition, the authors report that ventures are required to bear some indirect costs that are not directly related to profitability, and which are pressured to commit to in order to survive in a competitive market, one of which is Corporate Social Responsibility (CSR).As said by [14], a CSR presents a win-win scenario, allowing companies to simultaneously increase their profitability and produce social benefits [15]. CSR practices the fostering of relationships of trust between stakeholders, and in addition, sustainability-based business models help companies to create an environment of trust for innovation, which leads to the development of long-term competitiveness [16].In spite of the positive arguments to adopt social responsibility practices, there are some who are against social responsibility. On the other hand, there are certification standards such as the International Organization for Standardization (ISO) 26000, in which the CSR refers to good corporate governance, operating ethically and sustainability, and carrying out a set of voluntary commitments to manage its impact in the social, environmental, and economic fields, obtaining the maximum benefits for the whole society [17,18].The literature on sustainable business practices has focused on large companies, such as multinationals, whose individual impacts are significant [19,20]. However, although SMEs ...

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“…From Carroll [41], the economic consequences have become one of the basic considerations of CSR studies. As a result, CSR researchers in recent decades have focused on the economic impacts of CSR mostly for the bigger organizations [42], but yet to reach a universal conclusion. For example, Margolis and Walsh [2] showed that less than half (54) of the 127 studies from 1972 to 2002 had reported some positive CSR-performance relationships.…”

Section: Csr As Investmentmentioning

confidence: 99%

Do Managers Pay CSR for Private Motivation? A Dividend Tax Cut Case in Korea

2019

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A CEO who has an opportunity to pursue his interest may sacrifice investors with inefficient investments such as overinvestment in corporate social responsibility (CSR). As prior researchers have suggested a possibility to detect the perk portion of CSR investment using the dividend tax cut event, we tested whether managers decreased CSR spending while accelerating dividend payouts during the Korean dividend tax cut of 2015. Consistent with the prior studies on the dividend tax cut, we discovered a pattern of incremental dividend increase for the companies of agency conflict measured by extreme CEO ownership. However, we failed to find any statistically significant simultaneous reduction in donations after 2015. This study does not provide evidence that investments in CSR of Korean firms are not due to CEOs’ personal interest-seeking. Instead, we showed that the dividend tax cut event may not work as a universally applicable quasi-experimental setting to detect management overinvestments in CSR.

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Small and Medium Enterprises and the Relation between Social Performance and Financial Performance: Empirical Evidence from Korea

Cited by 33 publications

References 67 publications

Knowledge Management and Performance Measurement Systems for SMEs’ Economic Sustainability

Knowledge Management and Performance Measurement Systems for SMEs’ Economic Sustainability

Evaluation of Sustainability Practices in Small and Medium-Sized Manufacturing Enterprises in Southern Brazil

Do Managers Pay CSR for Private Motivation? A Dividend Tax Cut Case in Korea

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