Social and Normative Context of Sustainability

Over the last decades, the model of endless growth has come under harsh scrutiny, making increasingly more room for the concept of sustainability. Sustainability has permeated global discourse, prompting a paradigm shift in corporate responsibility, from a shareholder to a stakeholder-focused model. This has implications for the way companies, especially public corporations listed in stock markets, act and react to pressures on improving their sustainability profile and disclosure. From a theoretical standpoint, companies may benefit from investments in ESG activities, at least in the long run, in terms of economic performance and information asymmetry, depending on their ability to cope with the challenges posed in terms of the associated upfront costs, uncertainty, and industry-specific dynamics.