Linking corporate sustainability performance to firm performance: insights from selected Asian emerging nations

Purpose This paper aims to examine the relationship between overall corporate sustainability performance (CSP), its key dimensions economic, environmental and social performance and firm performance (FP) in emerging Asian nations. Design/methodology/approach The study uses secondary data from sustainability reports and other non-financial disclosures, covering 1,440 firm-year observations from 2016–17 to 2021–22. CSP scores are derived using content analysis. Tobin’s Q is used as a proxy for FP, with financial and control variables sourced from the Bloomberg database and other relevant websites. The relationship is analyzed using a generalized method of moments (GMM) model and robustness is confirmed through a generalized estimating equation (GEE) population-averaged model. Findings The results show that CSP and its sub-components positively affect FP, even after controlling for firm-specific, governance-specific and country-level factors. Notably, the environmental dimension exerts the strongest influence on FP. Practical implications Managers can strategically leverage CSP as a value-enhancing tool, while policymakers can promote improved sustainability performance by mandating the adoption of formal sustainability frameworks, which in turn may contribute to stronger FP. Originality/value This study makes a valuable contribution to the existing literature by offering empirical evidence on the relationship between both the level and the quality of overall CSP, including its three sub-components and FP within the context of emerging Asian nations.