The Impact of Sustainable Development on Return on Equity (roe, Roc) in Companies in the Logistics Sector in Europe
Year: 2025
Type: article
Abstract: Purpose: The objective of this article is to examine the impact of individual elements of the ESG strategy on the capital efficiency of logistics companies operating in Europe in the years 2017-2023.Design/methodology/approach: The study was conducted on logistic companies from Europe.The main tool of the analysis is the OLS (Ordinary Least Squares) model with heteroscedasticity correction to examine the relationship between ROE, ROC and ESG indices and control variables.Findings: The analysis confirms that ESG factors influence capital returns in logistics companies, with the social dimension (SCR) playing a notably positive and statistically significant role across all subsectors.This suggests that efforts toward employee welfare, ethical practices, and stakeholder engagement enhance both operational and financial performance.Conversely, the environmental index (ENV) negatively impacts profitability only in maritime transport, likely due to the high costs of ecological compliance.Corporate governance (CG) shows a negative correlation with profitability in the overall sample, implying potential misalignment with sector-specific needs.Additionally, asset size and liquidity are crucial, emphasizing the importance of integrated, balanced financial management.Research limitations/implications: Due to the limited duration of the research sample, the conclusions drawn have a relatively short shelf life, which is one of the limitations of the analysis.Another limitation may be the use of linear models for potentially nonlinear relationships between ESG scores and financial returns. Practical implications:The article makes a significant contribution to the literature on the financial aspects of sustainable development by presenting empirical evidence on the diverse impact of individual ESG components on capital efficiency in the logistics industry.The results of the study can provide a basis for a better understanding of the mechanisms of responsible investment and help managers, investors, and public policy makers formulate effective ESG strategies that support both environmental and social goals and the long-term profitability of companies.Originality/value: Despite the growing importance of ESG issues, there is still a lack of clear and widely documented empirical evidence on the impact of implementing sustainability policies on key financial indicators of companies, especially in high-carbon industries such as the logistic sector.The results can be an important contribution to the debate on the role of sustainability in shaping investment decisions and financial strategies of companies.
Author: Agata GNIADKOWSKA-SZYMAŃSKA
Institution: University of Łódź
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4412709067