Evaluation of the Effectiveness of Manufacturing Companies by Financial and Non-financial Indicators

Alena Kocmanova


Purpose. The purpose of this paper is to present a model for evaluation of effectiveness of manufacturing companies by financial and non-financial indicators in relation to corporate sustainability.

Methodology. Sustainability is a multidimensional concept based on a balance of environmental, social and economic pillars. It is difficult to evaluate it because it is expressed by many variables which most of them are non-financial ones. Data envelopment analysis is based on assessing the quantity of consumed inputs by the produced outputs and estimation of production possibility frontier; it computes a scalar measure of efficiency and determines potential improvements of inputs and outputs without requiring explicit specification of functional relations between inputs and outputs and setting weights of variables.

Results. Based on the computation of the CCR super efficiency DEA model the companies are divided into four groups: sustainable, pro-social, pro-environmental and unsustainable companies.

The theoretical contribution. The paper brings innovative perspective on sustainability measurement in terms of environmental and social inputs needed to ensure economic results. The use of financial indicators for evaluating corporate performance is limited though and it is no longer adequate for corporate stakeholders who are increasingly interested in the company’s impact on the environment and society.

Practical implications. The model outputs allow users to identify the position of a particular company and to reveal weaknesses in the effectiveness of a company, thus the model can serve its users as a basis for decision-making and performance management. The graphic presentation of the results makes the model outputs clear and easy to understand because it is obvious at a glance which companies are effective – sustainable and which are not.


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