Re­search: Fo­un­da­tion Ow­ners­hip and Sustai­na­bi­li­ty

Short Abstract 

In recent research, Assistant Professor David Schröder and Professor Steen Thomsen examine whether foundation ownership is associated with better sustainability outcomes. Using a global dataset of listed companies from 2003–2020, the study finds that foundation-owned firms have higher environmental and social ESG performance than comparable firms. These firms maintain their ESG engagement more consistently during economic downturns and show stronger engagement in emissions reduction after the 2015 Paris Agreement. The findings highlight the role of ownership purpose as a governance mechanism that supports long-term, sustainable business practices.

Key Findings

• Environmental and social dimension: E&S performance is particularly strong in areas such as emission reduction, workforce well-being, human rights, and product responsibility.
• Stronger E&S performance: Foundation-owned firms exhibit higher overall ESG scores compared to family- and investor-owned firms, particularly on environmental and social dimensions.
• Resilience during crises: During the 2008 financial crisis, foundation-owned firms maintained their ESG performance, while other firms reduced sustainability efforts.
• Purpose and profit: Higher sustainability performance does not come at the expense of financial performance.
• Variation across foundation types: Firms owned by charitable foundations tend to outperform those owned by family foundations in ESG performance, reflecting stronger alignment with social objectives.

The research has also contributed to broader discussions on sustainable capitalism. Building on their findings, David Schröder and Steen Thomsen recently contributed to a piece in the Harvard Law School Forum on Corporate Governance.

Read the paper.