Industry mimetic isomorphism and sustainable development based on the X-STATIS and HJ-biplot methods

Abstract

Based on both neo-institutional theory and comparative institutional analysis, this paper studies the role that mimetic forces play in the patterns and evolution of behavior concerning company sustainability. The panel data is composed of 6600 observations of 600 international large listed companies belonging to 39 different activity sectors for the period 2004–2014. Through employing the multivariate statistical methods HJ-biplot and X-STATIS, which provide a useful visualization of a complex data structure in a low-dimensional space, it can be observed that mimetic forces indicate that firms operating in high-impact sectors—sectors that operate under greater pressure from interest groups—face greater social and environmental risks and have higher corporate social responsibility (CSR) scores than companies from other sectors. The adoption or development of CSR practices depends largely on the type of industry in which the company operates, as stakeholder engagement in different industry sectors has different areas of concern. Therefore, companies operating in more polluting sectors, such as mining, paper, chemicals, or oil, give higher priority to environmental protection and defense of human rights, while other, less polluting companies involved in the communication sector are concerned to a greater extent by social issues, such as business ethics or the rights of their employees. Finally, this paper evidences that firms operating in similar contexts, in industries that face analogous risks and challenges, probably develop common policies and regulations with the aim of mitigating the pressures applied by their major stakeholder groups.