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Purpose <p>The medical device industry plays a crucial role in global healthcare and economic growth. However, medical device companies in Taiwan face challenges in effectively using resources to achieve sustainable healthcare goals. On the basis of the resource-based view (RBV), this study examines how specific environmental, social, and governance (ESG) factors influence operational and market performance in Taiwan’s medical device industry.</p> Design/methodology/approach <p>Using data from 39 publicly traded medical device companies from 2016 to 2021, we apply a three-step approach. First, we use network data envelopment analysis (DEA) to assess efficiency in operations and market performance. Second, we employ truncated regression to analyze the individual effects of ESG factors on these performances. Third, we use multidimensional scaling and cluster analysis to categorize firms based on their ESG strategies and performance levels.</p> Findings <p>Our results show that companies perform better in operations than in the market, indicating that internal efficiency does not always lead to financial success. Moreover, high greenhouse-gas emissions, poor product quality and safety, and weak governance transparency negatively affect operational and market performance. Firms with strong governance and environmental practices tend to achieve better market performance that those with weak practices.</p> Practical implications <p>This study underscores the importance of ESG practices in building competitive advantage, as explained by the RBV. Policymakers and business leaders should focus on enhancing environmental compliance, improving product quality, and strengthening governance transparency to support financial and operational success in the medical device industry.</p> Originality/value <p>This study provides empirical insights into the link between ESG factors and firm performance in an underexplored sector. By integrating DEA, truncated regression, and cluster analysis, this study offers a novel approach for evaluating ESG-driven performance in the medical device industry.</p>

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Individual environmental, social, and governance factors as drivers of operational and market performance in medical device companies

  • 期刊论文

  • 发表日期：

    2025年8月13日

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  • Wen-Min Lu,
  • Qian Long Kweh,
  • Chien-Heng Chou,
  • Mei-Li Liu

摘要

Purpose

The medical device industry plays a crucial role in global healthcare and economic growth. However, medical device companies in Taiwan face challenges in effectively using resources to achieve sustainable healthcare goals. On the basis of the resource-based view (RBV), this study examines how specific environmental, social, and governance (ESG) factors influence operational and market performance in Taiwan’s medical device industry.

Design/methodology/approach

Using data from 39 publicly traded medical device companies from 2016 to 2021, we apply a three-step approach. First, we use network data envelopment analysis (DEA) to assess efficiency in operations and market performance. Second, we employ truncated regression to analyze the individual effects of ESG factors on these performances. Third, we use multidimensional scaling and cluster analysis to categorize firms based on their ESG strategies and performance levels.

Findings

Our results show that companies perform better in operations than in the market, indicating that internal efficiency does not always lead to financial success. Moreover, high greenhouse-gas emissions, poor product quality and safety, and weak governance transparency negatively affect operational and market performance. Firms with strong governance and environmental practices tend to achieve better market performance that those with weak practices.

Practical implications

This study underscores the importance of ESG practices in building competitive advantage, as explained by the RBV. Policymakers and business leaders should focus on enhancing environmental compliance, improving product quality, and strengthening governance transparency to support financial and operational success in the medical device industry.

Originality/value

This study provides empirical insights into the link between ESG factors and firm performance in an underexplored sector. By integrating DEA, truncated regression, and cluster analysis, this study offers a novel approach for evaluating ESG-driven performance in the medical device industry.