Strategic Management and ESG Impact Assessment in Sustainable Agribusiness Development Model
DOI:
https://doi.org/10.61954/2616-7107/2025.9.4-8Keywords:
Agribusiness, ESG Factors, Environmental Indicators, Hierarchy Analysis Method, Sustainability.Abstract
Introduction. Hostilities in Ukraine pose challenges to the agro-industrial complex, including contamination of agricultural land, logistical route complications for the sale of agricultural products, and labour resource shortages. These concerns negatively impact the economic activities of agricultural enterprises, as well as food and environmental security, in Ukraine and globally. To ensure the sustainable operation of agricultural enterprises, it is necessary to conduct a comprehensive study of environmental, social, and governance (ESG) components to develop effective management strategies.
Aim and tasks. This study aims to develop a comprehensive, economically justified, and flexible system of ESG indicators that can enhance the efficiency of integrating environmental, social, and governance components with the strategic aspects of an enterprise’s economic activity.
Results. Using the hierarchy analysis method, a three-level model comprising target, criterion, and specific indicator levels was constructed to assess the impact of ESG factors on an enterprise’s operations. Calculating ESG indicators for the environmental component revealed the need to reduce CO₂ emissions and decrease the energy intensity. The social component exhibits a strong position in terms of wages and low injury rates, whereas it has a high staff turnover rate. An effective anti-corruption policy characterises the governance component, but there is insufficient implementation of digital management tools. The highest ROIC increase was observed when all the ESG components increased simultaneously. For example, a 0.14% increase in the environmental component (E) results in a combined increase of 0.50-0.63% with the social (S) and governance (G) components. The situation is similar for the social component, where a 10% increase leads to a 0.15% increase in ROIC. The governance component (G) demonstrates the most significant individual effect (0.16%), along with the environmental and social components, which increase by 0.62% and 0.63%, respectively.
Conclusions. A comprehensive system of ESG performance indicators ensures the effectiveness of a company’s environmental, social, and corporate social responsibility, as well as its financial performance, competition, innovation, and sustainability. The three-level model enables the assessment of both the direct impact of each ESG component on the enterprise’s activities and their interactions, creating a synergistic effect on the agricultural sector.
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