Moderating effect of vertical integration on the relationship between sustainability and performance: evidence from oil and gas energy sector

Abstract This research study aims to examine the impact of sustainability on firm performance and analyze how vertical integration moderates the connection between performance and sustainability in the oil and gas sector. We analyzed a sample dataset of oil and gas companies from the top ten oil-producing countries spanned over ten years (2011–2020). The pool-fixed regression technique confirms that sustainability and its three components, i.e., social, environmental, and governance, are negatively related to performance. However, vertical integration moderated the connection between sustainability and performance in the case of the oil and gas sector. We have identified firm size, age, and return share price positively related to firm performance in the oil and gas industry. At the same time, the debt ratio negatively impacts the firm’s performance. The findings are significant for the management of oil and gas firms and the policymakers and regulatory authorities of oil-producing and exporting countries.