How Does Each ESG Dimension Predict Customer Lifetime Value by Segments? Evidence from U.S. Industrial and Technological Industries

José Ramón Segarra-Moliner () and Inmaculada Bel-Oms
Additional contact information
José Ramón Segarra-Moliner: Quality Management, Universitat Jaume I de Castellón, 12006 Castelló de la Plana, Spain
Inmaculada Bel-Oms: Department of Corporate Finance, Faculty of Economics, Universitat de València, 46022 València, Spain

Sustainability, 2023, vol. 15, issue 8, 1-13

Abstract: The aim of this study is to analyse the research gap regarding the relationship between environmental, social and governance dimensions (ESG) of corporate sustainability initiatives and customer lifetime value (CLV). We divide an entire data sample (547 U.S. listed firms from the Refinitiv Thomson Reuters Eikon database) of both industrial and technological industries into three segments, using prediction-oriented modelling segmentation to test the hypotheses and evaluate the predictive validity of a partial least squares (PLS) model. As a result, we show that environmental, social and governance dimensions (ESG) encompass ten sustainability initiatives that, in turn, are the precursors of future financial firm performance, represented by CLV. Moreover, we found different poor-to-medium effects of each ESG dimension on CLV in segment 1. However, a stronger effect of the social dimension on CLV in segment 3 is completed with a poor effect, both positive by governance and negative by environmental dimensions, on CLV, while only the environmental dimension had greater effects on CLV in segment 2. The contribution of this research to the body of literature is twofold. First, it deepens the impact of each ESG dimension instead of considering sustainability initiatives as a whole. Second, it evaluates sustainability initiatives with a customer-based corporate firm valuation approach.

Keywords: sustainable marketing; customer lifetime value; partial least squares (PLS) (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/15/8/6907/pdf (application/pdf)
https://www.mdpi.com/2071-1050/15/8/6907/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:15:y:2023:i:8:p:6907-:d:1127724

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().