Performance implications of SA8000 certification

TY - JOUR

T1 - Performance implications of SA8000 certification

AU - Orzes, Guido

AU - Jia, Fu

AU - Sartor, Marco

AU - Nassimbeni, Guido

N1 - © Guido Orzes, Fu Jia, Marco Sartor, Guido Nassimbeni 2017

PY - 2017/11/6

Y1 - 2017/11/6

N2 - Purpose – The purpose of this paper is to shed light on the relationship between the adoption of Social Accountability 8000 (SA8000) – which is considered the most important ethical certification standard – and firm performance, building on agency and contingency theories. Design/methodology/approach – The authors analyse secondary longitudinal balance sheet data of listed firms employing a rigorous event-study approach and compare SA8000-certified companies to different control groups based on three matching criteria, i.e., industry, size, and pre-certification performance. The authors then study the moderating effects of the cultural features, the country’s development level, and the labour intensity on the causal relationship through multiple regression methods. Findings – The authors find that SA8000 certification positively affects labour productivity and sales performance but has no effect on profitability. Furthermore, the study supports that the relationship between SA8000 and profitability is moderated by two cultural features of the home country of the firms (i.e. power distance and uncertainty avoidance). Originality/value – This is the first study, which empirically tests the effects of the ethical certification SA8000 on firm performance using a cross-country sample. In addition, the authors contribute to the wider debate on the effects of corporate social responsibility practices on firm performance.

AB - Purpose – The purpose of this paper is to shed light on the relationship between the adoption of Social Accountability 8000 (SA8000) – which is considered the most important ethical certification standard – and firm performance, building on agency and contingency theories. Design/methodology/approach – The authors analyse secondary longitudinal balance sheet data of listed firms employing a rigorous event-study approach and compare SA8000-certified companies to different control groups based on three matching criteria, i.e., industry, size, and pre-certification performance. The authors then study the moderating effects of the cultural features, the country’s development level, and the labour intensity on the causal relationship through multiple regression methods. Findings – The authors find that SA8000 certification positively affects labour productivity and sales performance but has no effect on profitability. Furthermore, the study supports that the relationship between SA8000 and profitability is moderated by two cultural features of the home country of the firms (i.e. power distance and uncertainty avoidance). Originality/value – This is the first study, which empirically tests the effects of the ethical certification SA8000 on firm performance using a cross-country sample. In addition, the authors contribute to the wider debate on the effects of corporate social responsibility practices on firm performance.

KW - Corporate social responsibility

KW - Event study

KW - Operational performance

KW - SA8000

KW - Social accountability

KW - Sustainability

UR - http://www.scopus.com/inward/record.url?scp=85034851798&partnerID=8YFLogxK

U2 - 10.1108/IJOPM-12-2015-0730

DO - 10.1108/IJOPM-12-2015-0730

M3 - Article

AN - SCOPUS:85034851798

SN - 0144-3577

VL - 37

SP - 1625

EP - 1653

JO - International Journal of Operations & Production Management

JF - International Journal of Operations & Production Management

IS - 11

ER -