Measuring corporate sustainability in its multidimensionality: A formative approach to integrate ESG and triple bottom line approaches

Corporate sustainability is a multifaceted concept with different definitions and measures proposed by the literature and the standards. This study aims to develop and validate a scale of corporate sustainability implementation that can face the complexity and multidimensionality of the concept. Specifically, the scale was designed around four dimensions (governance, prosperity, planet, and people), a three-level structure, and a formative approach. The scale validation process entailed the engagement of experts, a survey of 303 Italian firms, and a case study application. The findings highlight the nature of the third-order construct of sustainability implementation and the relevance of adding the governance dimensions to the most spread triple bottom line approach. As a theoretical contribution, this study argues that the missed recognition of these features could originate differences in previous sustainability measures. Further studies would apply the scale to measure firm sustainability in different contexts and in relationship with relevant drivers and outcomes.