Academic journal article E+M Ekonomie a Management

Influence of Business Performance Measurement Systems and Corporate Sustainability Concept to Overall Business Performance: "Save the Planet and Keep Your Performance"

Academic journal article E+M Ekonomie a Management

Influence of Business Performance Measurement Systems and Corporate Sustainability Concept to Overall Business Performance: "Save the Planet and Keep Your Performance"

Article excerpt

Introduction

The examination of the measuring corporate performance issues is dedicated to many authors from different points of view: the relationship of the strategy and strategic orientation to the business performance (Morgan & Strong, 2003); the view of a strategic measurement performance system through strategic agenda and decision-making as a result of the process of (re)formulating strategy (Bisbe & Malagueno, 2012); the effect of strategic measurement performance system on the important attributes of the strategy formulating process (Gimbert et al., 2010); the effect of strategic performance measurement system of human resources and corporate results (Bento & White, 2014); the use of the process performance measurement (Tucek et al., 2013); the relations among customer satisfaction, customer loyalty and financial performance of a commercial bank (Belas & Gabcova, 2016); the methodology for prediction and detection of the ways of solving demanding situations in managerial work, with obvious implications in performance of managers and in efficiency of business performance management (Lajcin, Frankovsky, & Stefko, 2012); the model of acquisition activity in financial sector (Koraus et al., 2015); performance management and public corporate governance with regard to relationships with both external (stakeholders) and internal (politicians and management) actors (Romolini et al., 2015). Many other empirical studies realized around the world in recent years have also confirmed the relationship between strategic planning and business performance (Rudd et al., 2008).

If we are talking about the need and ability of the system to adapt and operate in the long term period with the orientation of economic, environmental and social performance of enterprise, we refer to a corporate sustainability performance measurement system (Searcy, 2012). According to Maletic et al. (2015) it seems that it exists some support for existence of a business case for corporate sustainability. Using Tobin's q was founded that corporate sustainability is strongly associated with market value (Lo & Sheu, 2007, p. 355); the greater engagement in sustainability activities can lead to a greater innovation, which in turn leads to greater financial and market performance (Maletic et al., 2015). On the other hand, the analysis of link between corporate social responsibility (in our view a narrower concept as corporate sustainability) and the performance indicators showed that the link between these variables is negative. These results cover this effect only during the first years in which sustainability actions are applied. It will be necessary to examine a longer time period (Lopez et al., 2007). All of these authors state that in the research it is still necessary to provide a clearer understanding. The aim of this paper is to identify the relationship between selected management tools and concepts of various development phases of strategic performance measurement systems to overall business performance measured by indicator ROE. Similarly the aim is to identify the relationship between the sustainability index and indicator ROE as a key aspect in terms of the current extremely advancing climate crisis.

1. A Brief Overview of the Performance Measurement Systems

As the report of RSA Tomorrow's Company shows (Neely et al., 2000), the achievement of sustainable corporate success in the demanding world market depends on the relevant enterprises indicators for the measurement of business performance. Currently, strategic performance management and measuring system can significantly contribute to achieving and solving this gap. From our point of view and after extensive literature resources search, we state that the issue of business performance measurement system was passed the following phases: measurement systems based on purely financial indicators, non-financial performance measurement indicators (impact of technological innovations, environment, etc. …

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