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foreign

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project with the title shades of green 
investigating new Ventures attention

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upon sustainability and its impact on success

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the rise of global challenges such as climate 
change LED to heightened pressure on corporations

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it stems from various sources among 
others regulatory interventions in

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this context have increased for example 
European law now requires public interest

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entities with more than 500 employees to 
annually release non-financial statements

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at the same time monitoring from the media 
on environmental matters increased a study

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by flammer reports that media's attention 
on corporate environmental matters is about

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six times higher in the 2000s compared to 
the 1980s social movements such as the most

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recent Global Fridays for future marches are 
also loudly calling for Action in this regard

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also consumers Consciousness and disregard has 
increased a growing amount of customers now has

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preferences for products or services with certain 
attributes or to certain production methods

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overall this led to heightened corporate 
attention on sustainability matters meaning

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firms increasingly incorporate environmental 
concerns into their strategy and their

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allocation of investment capital for example car 
manufacturers invest heavily in electric cars and

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into firms in a Renewables and new agricultural 
methods are developed to name only a few

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Academia is also paying increasing attention

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D antecedence and consequences of firms 
environmental Endeavors have long been of Interest

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the financial consequences still represent the 
focus within this research stream as the debate on

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the role and responsibility of profit maximizing 
corporations within our society continues

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but research results and conclusions are still 
mixed overall it appears now that a small

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minority of empirical studies reported positive 
relationship between environmental initiatives

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and financial performance the same applies to CSR 
studies early views based on an agency perspective

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viewed CSR related activity as largely detrimental 
to a firm's financial performance as they may add

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costs distract managers and benefit them rather 
than shareholders more recent work suggests that

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some sustainability practices now represent best 
practice hence are a necessity others may even

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enable firms to achieve successful differentiation 
from its competitors another recent study

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investigates the question whether investors 
actually believe firm CSR activities to pay off

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their results indicate that they care rather very 
little but there is some evidence that long-term

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investors and financial analysts do increasingly 
pay more attention to sustainability events

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it was also found that analysts who have been 
described as surrogate investors shift their

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assessments of CSR activities over time and 
eventually evaluate these Endeavors as positive

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all of this research is mainly based upon 
large listed meaning established firms

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but newly founded firms May Drive Green Innovation 
and as such play a major role in tackling climate

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change and ensuring sustainable economic growth 
the question whether these screen initiatives

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actually pay off for new Ventures meaning are 
well received by investors remains however

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largely unexplored a canadian-based study 
from 2012 reports a negative relationship

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between CSR activities and financial performance 
this finding supports the view that despite the

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sustainability being a major Trend Environmental 
Protection may still be associated with additional

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costs rather than opportunities the findings 
from prior CSR and sustainability research

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may not be applicable since the setting of new 
Ventures is very different to established ones

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our study aims to address this Gap we deem it 
important to consider the differences as regards

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the extent to which they consider sustainability 
matters as such we distinguish between firms that

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pay no attention at all those who pay little 
attention for example through mentioning it

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briefly within their communication to potential 
investors and those that pay high attention for

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example through incorporating environmental 
issues within their core business model

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let us first look into the potential effect of 
high environmental attention on the financial

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prospects of new Ventures the potential economic 
returns for new Ventures with high attention

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upon sustainability may be more positive 
for the following non-exhaustive reasons

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external pressure to behave responsibly towards 
the environment has increased tremendously which

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makes corporate Endeavors within the green sector 
more promising and attractive new Ventures with

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sustainability activities at their core may 
be able to differentiate themselves and gain a

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competitive advantage this can attract substantial 
tension from investors who also increasingly

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consider environmental issues in their investment 
decisions as a result of the growing legitimation

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of the green sector second green entrepreneurs 
might benefit from a better reputation and

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strong and close stakeholder relationships local 
communities with Goodwill new Ventures may depend

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on May appreciate their environmental efforts also 
top talents which are a scarce resource within new

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renters may be more inclined to work for a firm 
that pays attention to environmental concerns

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third having a green business model May ensure 
against corporate risks as pressure on politics

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increases it is likely that governments 
enforce stricter environmental legislation

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Queen new Ventures might prevent incurring 
additional costs through these expected changes

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additionally CSR activities build moral 
Capital thereby reducing the negative

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impact of potential future harmful events 
overall we argue that new Ventures which

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pay high attention to environmental concerns 
benefit from the recently growing legitimation

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after green sector and suggests that the 
effect upon economic returns is thus positive

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however this may not apply to new Ventures who pay 
only little attention to environmental concerns

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we argue that these new Ventures are rather 
not rewarded for mentioning it briefly

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within their Communications to potential 
investors this is due to the following

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investors May perceive these Endeavors as 
a costly distraction from The Core Business

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activities managers may not be as competent 
in addressing environmental issues compared

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to the knowledge on their actual business model 
they may therefore have difficulties negotiating

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these matters with various stakeholders 
hence a time-consuming extra effort

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second if these activities represent environmental 
activities that are already established within the

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industry investors will not reward those 
new Ventures that address a necessity

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this also applies to Consumers who nowadays 
at least expect firms to adhere to certain

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established regulations and Norms within this 
context third and from an agency perspective

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sustainability activities are viewed as alleged 
made this is because potential investors May

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fear that these are pursued not to actually 
support the feasibility of the business model

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but rather serve the interests of the founders 
improve their Public Image and benefit their

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future careers the insurance-like effect may have 
particularly apply to them and not to shareholders

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overall we argue that paying little attention to 
sustainability does not pay off for new Ventures

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investors may not view these conservations 
as a business opportunity during times of

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heightened environmental awareness but rather as 
a costly distraction as such new Ventures that

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do not incorporate environmental issues in their 
company representations at all may be better off

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combining both strings of augmentation we 
suggest a U-shaped relationship between

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new Ventures attention upon sustainability and 
financial success starting to pay attention to

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sustainability issues will decrease financial 
success as these activities are perceived as

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time and cost consuming leading to 
a negative exponential relationship

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in contrast a credible inclusion of sustainability 
thoughts in the business model and corresponding

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representations can create a competitive Advantage 
leading to an exponential positive relationship

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between new Ventures sustainability 
attention and financial performance

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combining a positive and negative 
exponential function leads to an

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overall u-shaped relationship between new Venture 
sustainability attention and financial success

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we further suggest that the experience of 
Founders place a moderating role Founders

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in their underlying characteristics shape new 
Venture performance Founders experience is deemed

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to play a crucial role in convincing investors 
of the performance prospects of their endeavors

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Founders prior work and prior industry experience 
positively influenced stakeholder perceptions and

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as such enhances cognitive legitimacy studies 
in this way suggest that career experience is

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particularly important on the conditions of 
uncertainty this applies to the green sector

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which still may be described as emerging on a 
large scale despite the accelerating level of

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legitimation reputable Founders who have gained 
a large amount of work experience and build a

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valuable Network within the industry may be more 
convincing in selling their green story but this

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may only apply to new Ventures with sustainability 
activities at the very core of the business model

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that experienced Founders should understand 
the need to focus on the on their core

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activities whereas newcomers may be more 
inclined to show that they pursue a wide

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range of activities including that they pay 
a little attention to environmental concerns

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this however may not be credible and potentially 
rather perceived as advertising or greenwashing

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we hypothesize Founders experience in form 
of Prior work or prior industry experience

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to flatten for low attention and to steepen for 
high attention the u-shaped relationship between

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new Ventures attention upon sustainability and 
new Venture success we test our hypothesis in

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a European sample of 1258 single Founders in 
there for profit new Ventures that were founded

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between 2013 and 2017. we collected relevant data 
from the publicly available database crunch base

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let us look at our measures and start with the 
independent variable to measure new Ventures

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attention upon environmental concerns We performed 
a Content analysis upon firm's descriptions

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in the context of new Ventures one can argue that 
the information provided in firm's descriptions is

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particularly suitable for capturing a firm's 
intention and attitude towards very specific

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subject the underlying assumption era is that 
words or phrases that are frequently used are

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cognitively Central and reflect what is most 
on the user's mind we constructed this proxy

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in several steps first we Define search items that 
the stakeholders and in particular investors would

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associate with firms sustainability efforts 
and hence perceive the Enterprise as green

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the words are mainly based upon previous research 
second we downloaded the descriptions and used the

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linguistic inquiry word count software covered for 
computerized text analysis to apply our dictionary

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thereby we control for a different length 
and necessitated and minimum word count

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moreover we perform the validation process 
to ensure the accuracy of the vocabularies

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employed to identify the new Ventures attention 
upon sustainability we also had to make sure

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that the range of attention was captured in an 
appropriate manner our dependent variable is

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New Hampshire success which we operationalize 
as the venture's ability to attract funding

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as various funding rounds signal trust and belief 
in new Ventures prior studies reveal a number of

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funding rounds to be an adequate proxy for 
new Venture success our moderating variable

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is Founders experience we measure prior work 
experience as the number of years the founders

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work prior to starting new venture for prior 
industry experience we create a dummy variable

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which is coded one if the founder has had previous 
experience in Juventus industry and zero otherwise

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we furthermore control for a host 
of variables that were previously

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identified as determinants of new Venture 
success given that the dependent variable

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takes on non-negative Integer values we use 
the poison regression model for our analysis

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let us next have a look at our results in model 
3 we test our hypothesis 1 which proposes a

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U-shaped relationship between attention upon 
sustainability and eventual success let's zoom

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in the result shows a positive and significant 
relationship which supports hypothesis 1.

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We performed several checks in order 
to ensure the appropriateness of the

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u-shaped relationship which 
you find outlined in our paper

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in the figure here you see an illustration of 
the u-shaped relationship model 4 and 5 test

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the moderating effect of Founders prior experience 
let us have a closer look at the relevant numbers

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model 4 tests our hypothesis to a which outlines 
a moderating effect of Founders prior work

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experience on the relationship between attention 
upon sustainability and new Venture success

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the relationship is positive and significant thus 
supporting our hypothesis 2A Model 5 tests our

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hypothesis to be which outlines a moderating 
effect of Founders prior industry experience

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the relationship is positive but not significant 
thus our hypothesis to be is rejected

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this figure provides an illustration 
of the confirmed moderating effect

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at different levels of Prior work experience

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we aim to make several contributions with our 
study first we add to the broader literature

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on CSR and sustainability since a large majority 
of studies within the stream has focused on large

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established firms he Ventures however may play 
a key role in driving green innovation as such

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we theoretically consider the peculiarities of new 
Ventures and find empirical support for our large

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European sample we fill an empirical Gap with 
up-to-date evidence on a major trend of our time

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in this vein our study also contributes 
to a growing stream of studies within CSR

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and sustainability research that considers 
different types of sustainability practices

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we showed us that this distinction is vital 
since it has different success implications

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for new enters from a methodological point of view 
our content analysis represents an alternative to

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the commonly used CSR ratings and questionnaires 
which allows replicability in an eventual context

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second we contribute to the 
entrepreneurship literature

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research on new Ventures success factors mainly 
focuses on individual characteristics of the

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entrepreneur but only recently has been extended 
by organizational and environmental factors we add

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sustainability as an environmental influencing 
factor of new Venture success and also consider

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founder characteristics in this relation our 
study also has practical implications as the

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green sector becomes more and more legitimized 
an increasing number of entrepreneurs may want

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to exploit the opportunities arising through 
the heightened attention upon sustainability

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entrepreneurs should carefully consider 
the degree of greenness and formulating

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their new business idea and selling 
it to stakeholders and shareholders

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moreover when engaging in a new Venture that 
focuses on a green business model prior work

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experience can help Founders to overcome 
uncertainties and Foster new Venture success

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many thanks for your attention if you 
have any questions ideas for improvement

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or any other remarks do reach out 
we greatly appreciate your input

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foreign