Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/309947 
Year of Publication: 
2022
Citation: 
[Journal:] Journal of Business Ethics [ISSN:] 1573-0697 [Volume:] 183 [Issue:] 2 [Publisher:] Springer Netherlands [Place:] Dordrecht [Year:] 2022 [Pages:] 401-428
Publisher: 
Springer Netherlands, Dordrecht
Abstract: 
This article embarks on ethical trade-offs at the sustainability/finance interface by contrasting shareholders' interest in short-term financial returns with society's interest in counteracting ecological and social grievances. Scrutinizing share repurchases, we investigate a firm's communicated sustainability orientation (i.e., its environmental and social value orientation) as well as its environmental and social sustainability performance. Our results are based on a large-scale panel dataset of 491 U.S. firms observed from 2004 to 2016. The dataset combines share buyback data with sustainability orientation scores from shareholder letters and sustainability performance ratings. The econometric models suggest no association between social value orientation and repurchase volumes, but a significantly negative relationship between environmental value orientation and buybacks in a cubic form. Executive stock options partially attenuate this relationship. Share repurchases in turn negatively affect future environmental and social performance. This study grasps the consequences of firms' short-term shareholder satisfaction and discusses its ethical implications in the context of firms' contribution to sustainable development, thereby providing important insights to the business ethics discourse.
Subjects: 
Corporate sustainability
Sustainability orientation
Sustainability performance
Share repurchases
Buybacks
Managerial incentives
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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