The Effects of Sustainable Management on Value Creation of International Social Ventures: Evidence from Korea

Although sustainable management is crucial for international business in the recent trade and commercial environment, there has been little research on the effects of international social ventures’ sustainable management on financial performance. Against this backdrop, we attempted to developed a model of the effects and empirically test it. The sample consisted of 250 cases of Korean international social ventures with a corporation settlement in every December. We used the environmental, social, and governance evaluation index disclosed by the Korea Institute of Corporate Governance and Sustainability in order to measure sustainable management efforts of an international social ventures. In addition, we secured their financial records from databases including the TS-2000 and the FnGuide in order to measure value creation. The results of a multiple regression analysis were as follows: First, international social ventures’ environmental management changes positively influenced value creation. Nonetheless, international social ventures’ social and governance changes little affected value creation. These results indicated that Korean international social ventures have been well responding to changes in international environmental regulations. In addition, the results of our study provided managerial guidelines for managers of international social ventures in regard to the impact of sustainable management on value creation. Moreover, we presented implications for policy makers of international trade and commerce to support and nuture competitive international social ventures.