Explicating dynamic capabilities for corporate sustainability: Evidence from corporate social responsibility reports

Abstract

Persistent differences in corporate commitments to sustainability have led to an increasing debate. However, reasons behind such differences still lack a generic theorization. We argue that a key source of these differences lies in what we define as dynamic capabilities for corporate sustainability. These conceptualized capabilities can be disaggregated into three distinctive but related capabilities for firms to: (1) sense the emerging needs of various stakeholders, (2) identify profitable opportunities from the rapidly changing sustainable expectations, and (3) modify existing functional capabilities that perceive to be less unsustainable. We use an empirical study to support our argument.