Investigating the Relationship Between ESG Performance and Efficiency in Aircraft Manufacturers

Year 2025, Volume: 06 Issue: 02, 106 - 125

Murat Ahmet Doğan

Abstract

This study examines the relationship between operational and market efficiency and ESG scores of publicly traded aircraft manufacturers whose aircraft are extensively utilized by airline operators. The efficiency analysis of manufacturers spanning 2003-2023 was conducted using Window Network DEA methodology, which enabled comprehensive analysis by effectively multiplying the limited number of decision-makers in the industry. In the second phase, the relationship between efficiency outcomes and ESG Combined Score—comprising environmental (E), social responsibility (S), and corporate governance (G) components—was investigated using Wavelet analysis. This methodological choice was driven by its capacity to reveal both the direction and intensity of relationships between variables across temporal breakdowns. While the correlation patterns between manufacturers' operational and market efficiency and ESG Combined Scores exhibit temporal variations, strong correlations are consistently observed across all manufacturers within 10–15-year periods. The findings demonstrate that ESG integration necessitates a long-term strategic approach, extending beyond the predominantly short-term focus prevalent in existing literature. From a managerial perspective, the results indicate that ESG integration's impact on both operational and marketing efficiency demonstrates firm-specific variations.

Keywords

Aviation , Sustainability , ESG , DEA , Wavelet

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