Relationship Between Corporate Social Responsibility, Environmental Management, and Profitability

Abstract

The U.S. hospitality industry's profitability has been shifting to environmental management and corporate social responsibility (CSR) practices. Hospitality industries accounted for 5% of the global market in 2015 and are expected to increase by 130% in 2035. Grounded in stakeholder theory, this correlation study examined the relationship between corporate sustainability officer (CSO) CSR, CSO environmental management, and hospitality business profitability. Secondary data were collected from 97 hotel websites of the Minneapolis-St. Paul, Minnesota from 2014 to 2016. The multiple linear regression combinations of CSR and environmental management (EM) measured significantly related to the profitability index, F(3, 93) = 4.67, p < .001, adj. R2 = .13. The sample multiple correlation coefficients were .36, indicating approximately 13% of the variance of the profitability index. The multiple linear regression combinations of CSR measures significantly related to the profitability index, F(2,94) = 6.05, p < .001, adjusted R2 = .11. The sample multiple correlation coefficients were .34, indicating approximately 11% of the variance of the profitability index. The linear combination of EM measures were not significantly related to the profitability index, F(2,94) = 2.91, p < .001, adjusted R2 = .06. The sample multiple correlation coefficients were .24, indicating approximately 6% of the variance of the profitability index. The implications for positive social change include the potential to identify hospitality industry leaders involved in environmental management who have a CSR to promote social change in their communities.