Corporate Sustainable Longevity: Scale Development and Validation

Abstract

From the roots of corporate longevity that has been built by previous researchers, this article enhances existing work toward measuring the concept of corporate sustainable longevity (CSL) beyond an average firm's age. By adopting the sequential exploratory mixed method, we performed this study in two phases: qualitative followed by quantitative. In the first phase, we used the Delphi method to verify and validate the thematic elements of the construct and generated a pool of items from the extant literature. In the second phase, we collected the data twice through a survey questionnaire (pilot N = 200 and final N = 271) and validated the scale through exploratory and confirmatory factor analyses. The results generated a five-factor structure of CSL with model fit indices, root mean square error of approximation (RMSEA) = 0.15, goodness-of-fit index (GFI) = 0.917, adjusted goodness-of-fit index (AGFI) = 0.901, normed fit index (NFI) = 0.938, incremental fix index (IFI) = 0.996 with comparative fit index (CFI) = 0.996 with satisfactory discriminant and convergent validities. Cronbach's alpha ranging from 0.89 to 0.90 provided an evidence of internal consistency reliability of the CSL scale. This novel scale fills the gap in the literature by enabling practitioners and researchers in anticipating the firm's ability to survive in the long run. The significance and limitations of the study are discussed in the end.

Family SMEs’ survival: the role of owner family and corporate social responsibility

“…These findings have significant theoretical, managerial, and contextual contributions as well as practical implications for family firms. This paper responds to the calls from Ahmad et al (2019) and Napolitano et al (2015) to better understand survival or longevity in other types of businesses (family firms).…”

“…A five-point Likert scale was used to measure the agreement of respondents for each item or statement, where 1 represented "strongly disagree" and 5 represented "strongly agree." For sustainable survival, a five-dimensional scale of CSL constructed and validated by Ahmad et al (2019) was adopted. The five dimensions included financial strength, customer orientation, internal capabilities, strategic perspective, and learning and growth perspective, whereas FIB was operationalized by adapting the conceptualization of Debicki et al (2016).…”

“…The concept of sustainable survival traces back to Napolitano et al's (2015) study on "integrated framework of business longevity," and later it was conceptualized and operationalized by Ahmad et al (2019). While validating the CSL construct, Ahmad et al (2019) argued that a firm should have effective strategies in five functional areas to survive in the long run. These areas include financial strength, strategic perspective, customer orientation, learning and growth, and internal capabilities.…”

“…Along with continuity, a family firm requires certain capabilities to sustain its long-term survival (Bika and Kalantaridis, 2017) or, in other words, sustainable survival. Ahmad et al (2019), Napolitano et al (2015) have identified and empirically validated these capabilities in the broader context of all types of firms. They captured the firms' abilities for long-term survival as corporate sustainable longevity (CSL).…”

Family firms’ sustainable longevity: the role of family involvement in business and innovation capability

“…One of the fundamental objectives of any business is to survive in the long run. The ability of a firm to sustain its longevity essentially depends on maintaining the profitability of the business along with numerous other factors (Ahmad et al , 2019; Napolitano et al , 2015). Despite the fact that family firms are the dominant form of business representing around 80% of global business structure (Gagné et al , 2019), survival or longevity is the biggest common challenge for them across the world.…”