In relation to organizational performance measurement, there is a growing concern about the creation of value for people, society and the environment. The traditional corporate reporting does not adequately satisfy the information needs of stakeholders for assessing an organization’s past and future potential performance. Practitioners and scholars have developed new non-financial reporting frameworks from a social and environmental perspective, giving birth to the field of Integrated Reporting (IR). The Economy for the Common Good (ECG) model and its tools to facilitate sustainability management and reporting can provide a framework to do it. The present study depicts the theoretical foundations from the business administration field research on which the ECG model relies. Moreover, this paper is the first one that empirically validates such measurement scales by applying of Exploratory Factor Analysis on a sample of 206 European firms. Results show that two out of five dimensions are appropriately defined, along with some guidelines to refine the model. Consequently, it allows knowledge to advance as it assesses the measurement scales’ statistical validity and reliability. However, as this is the first quantitative-driven research on the ECG model, the authors’ future research will confirm the present results by means of Confirmatory Factor Analysis (CFA).
The economy for the common good (ECG) has been developed as a practical economic model, starting in Austria, Bavaria, and South Tyrol in 2010. Nowadays, ECG is considered a viable approach for sustainable transformation across Europe, and also worldwide. Within economic policy, ECG expands social market economy concepts; from a theoretical perspective of economics the question arises, of whether the implicit theoretical model refines the neoclassical paradigm or actually transcends it. During the first scientific conference on the ECG, at the end of 2019 at the University of Applied Sciences Bremen, some 150 participants concluded that an investigation of ECG practices was necessary, and that the fundamental theory needs to be developed in an explicit and systematic way. This article is a first attempt at contrasting the theoretical basis of the ECG model with neoclassical economics, using core concepts and cornerstones of the latter’s paradigm. The outcome is the cornerstone of common good economics.
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