Decoupling analysis in assessing corporate maturity in environmental sustainability: evidence from metallurgical and mining companies

Abstract

Importance: sustainable business development has attracted considerable attention from researchers and teams in the field of economics since the end of the 20th century. Existing corporate standards in this field, such as ESG (environmental, social, governance), require an assessment of companies’ sustainability maturity before they formulate their strategies. However, the decoupling concept proposed by the Organisation for Economic Cooperation and Development (OECD) between anthropogenic environmental impacts and resource use for economic growth has not been developed at the microeconomic level. Purpose: this paper proposes a method to assess the ESG maturity of a company by analysing the relationship between its operational, financial and non-financial performance, decoupling analysis. Research design: the method consists of three components: decoupling analyses of company data using a modified model of P. Tapio and N. Finel ‘The Decoupling Diamond’, analysing the dynamics of indicators contributing to the reduction of the company’s environmental impact, and assessing the transparency of disclosure of non-financial indicators in reporting. Results: based on the results, a classification of companies by the level of maturity of the E (environment) component into five stages in the categories of technogenic and sustainable types of development was proposed. The proposed methodology was tested on the data of metallurgical and mining companies in Russia, which, according to rating agencies, are leaders in the field of sustainable development. The results extend the possibilities to assess the company’s position on the sustainable development journey and to apply described methodology in strategic management.