The Impact of Environmental Performance and Social Responsibility on Market Value: The Mediating Role of Company Life

With the growth and development of the capital market and the demand and accountability of the business unit stakeholders to provide financial and non-financial information, many criticisms have been leveled at traditional financial reporting on inefficiency in evaluating the past and future of businesses. Therefore, the purpose of this study is to investigate the impact of environmental factors and social responsibility on market value during the life cycle of companies.

This research is a descriptive and post-event research and is also considered as an applied research in terms of purpose. In this study, 109 companies listed on the Tehran Stock Exchange during the years 1393 to 1398 were examined. After receiving the opinion of experts, the data of the questionnaire were classified into three areas of environmental factors, social responsibility and life cycle of companies and through modeling structural equations with the help of SMART PLS 3 software, research hypotheses were tested.

The results showed that environmental factors and social responsibility have a positive and significant effect on the market value of companies and the life cycle of companies has a mediating role in the impact of environmental factors and social responsibility on their market value, but the intensity of this role is minor.

According to the research findings, companies can increase the value of the company in the long run by investing in the field of social and environmental responsibility and disclosing these factors, in addition to fulfilling its mission to society and gaining social legitimacy.

The result of the present study is that it provides a more comprehensive insight into the field of environmental performance and corporate social responsibility and the development of theoretical foundations of corporate sustainability for stakeholders. It also makes strategic differentiation of companies and leads to better financial performance in the long run and survival of the company. The innovative aspect of this research is the use of company life cycle variable as a mediating role in corporate sustainability performance and its impact on the market value of companies.