The Definition of Firm Boundaries and Its Impact on Sustainability

Luis Armando Lujan Salazar and Gonzalo Maldonado Guzman

Journal of Management and Sustainability, 2017, vol. 7, issue 2, 126-134

Abstract: The way in which the boundaries of a firm are defined also determines its responsibilities. Besides the firm¡¯s goals of profitability and survival, there are implications beyond its physical boundaries, such as sustainability. There are several definitions of the boundaries of a firm, each one with its own implications. Considering external resources related to the firm may allow decision makers to take responsibility for what takes place beyond its frontiers. Because firms are not isolated, sustainability goes beyond the boundaries of the firm and requires incorporating external factors. The relation of a firm with its external factors can be established in several dimensions; one of them is considering the relation of the firm with its environment. In this study, we reviewed literature on firm boundaries and found out that the boundaries, limits, and responsibilities of firms are not sharply defined. An interesting point is that the boundaries of the firm can be expanded to account for external resources and the impact of the firm¡¯s activities, so that the firm may take steps to reduce its green footprint and contribute to sustainability from the perspective of the triple bottom line, which includes economic, social, and environmental aspects.

Keywords: sustainability; firm boundaries; economic incentives; sustainable business model (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/jms/article/view/67572/37196 (application/pdf)
http://www.ccsenet.org/journal/index.php/jms/article/view/67572 (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:ibn:jmsjnl:v:7:y:2017:i:2:p:126-134

Access Statistics for this article

More articles in Journal of Management and Sustainability from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().