Research Article

A system dynamics model for sustainable corporate strategic planning

Mauricio Becerra-Fernandez; Liliana Elizabeth Ruiz-Acosta; David Andres Camargo-Mayorga; Mario Andrés Muñoz

Downloads: 2
Views: 70


Paper aims: This paper presents a manufacturing process model for assessing the effects on economic, social, and environmental targets, given variations on corporate strategies of production, innovation, marketing, and demand for final goods.

Originality: The model integrates economic, social, and environmental dimensions that are validated through three main scenarios: Business as Usual (no strategic application), Business as Investment (strategic application), and Business as Vision (changes in demand).

Research method: The model estimates the social, environmental, and economic performance through time based on the System Dynamics methodology.

Main findings: The results demonstrate the model's suitability as a decision-support tool for sustainability planning in a corporate environment.

Implications for theory and practice: The model facilitates the analysis of the effects of resource allocation on corporate strategy.


Corporate strategic planning, Sustainability, System dynamics, Modeling


Abdelkafi, N., & Täuscher, K. (2016). Business models for sustainability from a system dynamics perspective. Organization & Environment, 29(1), 74-96.

Ahmad, R., Ahmad, S., Islam, T., & Kaleem, A. (2020). The nexus of corporate social responsibility (CSR), affective commitment and organisational citizenship behaviour in academia: a model of trust. Employee Relations: The International Journal, 42(1), 232-247.

Ansari, N., & Seifi, A. (2012). A system dynamics analysis of energy consumption and corrective policies in Iranian iron and steel industry. Energy, 43(1), 334-343.

Antolín-López, R., Delgado-Ceballos, J., & Montiel, I. (2016). Deconstructing corporate sustainability: a comparison of different stakeholder metrics. Journal of Cleaner Production, 136, 5-17.

Aßländer, M. S. (2011). Corporate Social responsibility as subsidiary co-responsibility: a macroeconomic perspective. Journal of Business Ethics, 99(1), 115-128.

Banos-González, I., Martínez-Fernández, J., & Esteve-Selma, M. A. (2016). Using dynamic sustainability indicators to assess environmental policy measures in Biosphere Reserves. Ecological Indicators, 67, 565-576.

Barlas, Y. (1996). Formal aspects of model validity and validation in system dynamics. System Dynamics Review, 12(3), 183-210.<183::AID-SDR103>3.0.CO;2-4.

Bautista, S., Espinoza, A., Narvaez, P., Camargo, M., & Morel, L. (2019). A system dynamics approach for sustainability assessment of biodiesel production in Colombia: baseline simulation. Journal of Cleaner Production, 213, 1-20.

Becerra-Fernandez, M., Cosenz, F., & Dyner, I. (2020). Modeling the natural gas supply chain for sustainable growth policy. Energy, 205, 118018.

Bian, J., Liao, Y., Wang, Y.-Y., & Tao, F. (2021). Analysis of firm CSR strategies. European Journal of Operational Research, 290(3), 914-926.

Bianchi, C., & Rua, R. S. S. (2017). Applying dynamic performance management to detect behavioral distortions associated with the use of formal performance measurement systems in public schools: the case of Colombia. In APPAM 39th Annual Fall Research Conference. Washington: APPAM.

Bilbao-Terol, A., Arenas-Parra, M., Cañal-Fernández, V., & Obam-Eyang, P. N. (2018). Multi-criteria analysis of the GRI sustainability reports: an application to Socially Responsible Investment. The Journal of the Operational Research Society, 69(10), 1576-1598.

Bockermann, A., Meyer, B., Omann, I., & Spangenberg, J. H. (2005). Modelling sustainability: Comparing an econometric (PANTA RHEI) and a systems dynamics model (SuE). Journal of Policy Modeling, 27(2), 189-210.

Broadstock, D. C., Matousek, R., Meyer, M., & Tzeremes, N. G. (2020). Does corporate social responsibility impact firms’ innovation capacity? The indirect link between environmental & social governance implementation and innovation performance. Journal of Business Research, 119, 99-110.

Brower, J., & Mahajan, V. (2013). Driven to be good: a stakeholder theory perspective on the drivers of corporate social performance. Journal of Business Ethics, 117(2), 313-331.

Cardenas, L. M., Franco, C. J., & Dyner, I. (2016). Assessing emissions-mitigation energy policy under integrated supply and demand analysis: the Colombian case. Journal of Cleaner Production, 112, 3759-3773.

Chaudhri, V. (2016). Corporate social responsibility and the communication imperative: perspectives from CSR managers. International Journal of Business Communication, 53(4), 419-442.

Crane, A., Henriques, I., Husted, B. W., & Matten, D. (2017). Measuring corporate social responsibility and impact: enhancing quantitative research design and methods in business and society research. Business & Society, 56(6), 787-795.

Dartey-Baah, K., & Amoako, G. K. (2021a). A review of empirical research on corporate social responsibility in emerging economies. International Journal of Emerging Markets, 16(7), 1330-1347.

Dartey-Baah, K., & Amoako, G. K. (2021b). Global CSR, drivers and consequences: a systematic review. Journal of Global Responsibility, 12(4), 416-434.

Dobre, E., Stanila, G., & Brad, L. (2015). The influence of environmental and social performance on financial performance: evidence from Romania’s listed entities. Sustainability, 7(3), 2513-2553.

Duran-Encalada, J. A., & Paucar-Caceres, A. (2009). System dynamics urban sustainability model for Puerto Aura in Puebla, Mexico. Systemic Practice and Action Research, 22(2), 77-99.

Elkington, J. (2020). Green swans: the coming boom in regenerative capitalism. New York: Fast Company Press.

Fang, W., An, H., Li, H., Gao, X., Sun, X., & Zhong, W. (2017). Accessing on the sustainability of urban ecological-economic systems by means of a coupled emergy and system dynamics model: a case study of Beijing. Energy Policy, 100, 326-337.

Felicetti, A. M., Ammirato, S., Corvello, V., Iazzolino, G., & Verteramo, S. (2022). Total quality management and corporate social responsibility: a systematic review of the literature and implications of the COVID-19 pandemics. Total Quality Management & Business Excellence. In press.

Feng, Y., Zhu, Q., & Lai, K.-H. (2017). Corporate social responsibility for supply chain management: a literature review and bibliometric analysis. Journal of Cleaner Production, 158, 296-307.

Forrester, J. W. (1997). Industrial dynamics. The Journal of the Operational Research Society, 48(10), 1037-1041.

Frynas, J. G., & Yamahaki, C. (2016). Corporate social responsibility: review and roadmap of theoretical perspectives. Business Ethics), 25(3), 258-285.

Halkos, G., & Nomikos, S. (2021). Corporate social responsibility: trends in global reporting initiative standards. Economic Analysis and Policy, 69, 106-117.

Harik, R. E. L., Hachem, W., Medini, K., & Bernard, A. (2015). Towards a holistic sustainability index for measuring sustainability of manufacturing companies. International Journal of Production Research, 53(13), 4117-4139.

Hickel, J., & Kallis, G. (2020). Is green growth possible? New Political Economy, 25(4), 469-486.

Hickel, J., Brockway, P., Kallis, G., Keyßer, L., Lenzen, M., Slameršak, A., Steinberger, J., & Ürge-Vorsatz, D. (2021). Urgent need for post-growth climate mitigation scenarios. Nature Energy, 6(8), 766-768.

Jin, E., Mendis, G. P., & Sutherland, J. W. (2019). Integrated sustainability assessment for a bioenergy system: A system dynamics model of switchgrass for cellulosic ethanol production in the U.S. midwest. Journal of Cleaner Production, 234, 503-520.

Jin, W., Xu, L., & Yang, Z. (2009). Modeling a policy making framework for urban sustainability: incorporating system dynamics into the Ecological Footprint. Ecological Economics, 68(12), 2938-2949.

Joung, C. B., Carrell, J., Sarkar, P., & Feng, S. C. (2013). Categorization of indicators for sustainable manufacturing. Ecological Indicators, 24, 148-157.

Kim, K.-S., Cho, Y.-J., & Jeong, S.-J. (2014). Simulation of CO2 emission reduction potential of the iron and steel industry using a system dynamics model. International Journal of Precision Engineering and Manufacturing, 15(2), 361-373.

Kong, Y., Antwi‐Adjei, A., & Bawuah, J. (2020). A systematic review of the business case for corporate social responsibility and firm performance. Corporate Social Responsibility and Environmental Management, 27(2), 444-454.

Latouche, S. (2012). Can the left escape economism? Capitalism, Nature, Socialism, 23(1), 74-78.

Lehmann, C., Delbard, O., & Lange, S. (2022). Green growth, a-growth or degrowth? Investigating the attitudes of environmental protection specialists at the German Environment Agency. Journal of Cleaner Production, 336, 130306.

Lockett, A., Moon, J., & Visser, W. (2006). Corporate social responsibility in management research: focus, nature, salience and sources of influence. Journal of Management Studies, 43(1), 115-136.

MacNeil, I., & Esser, I. (2022). From a financial to an entity model of ESG. European Business Organization Law Review, 23(1), 9-45.

Marcelino-Sádaba, S., González-Jaen, L. F., & Pérez-Ezcurdia, A. (2015). Using project management as a way to sustainability. From a comprehensive review to a framework definition. Journal of Cleaner Production, 99, 1-16.

Martínez-Fernández, J., Esteve-Selma, M. A., Baños-González, I., Carreño, F., & Moreno, A. (2013). Sustainability of Mediterranean irrigated agro-landscapes. Ecological Modelling, 248, 11-19.

Matten, D., Crane, A., & Chapple, W. (2003). Behind the mask: revealing the true face of corporate citizenship. Journal of Business Ethics, 45(1), 109-120.

McPherson, S. (2019, January 14). Corporate responsibility: what to expect in 2019. Forbes.

McWilliams, A., Siegel, D. S., & Wright, P. M. (2006). Corporate social responsibility: strategic implications. Journal of Management Studies, 43(1), 1-18.

Morioka, S. N., & Carvalho, M. M. (2016). Measuring sustainability in practice: Exploring the inclusion of sustainability into corporate performance systems in Brazilian case studies. Journal of Cleaner Production, 136, 123-133.

Musango, J. K., Brent, A. C., Amigun, B., Pretorius, L., & Müller, H. (2012). A system dynamics approach to technology sustainability assessment: The case of biodiesel developments in South Africa. Technovation, 32(11), 639-651.

Nabavi, E., Daniell, K. A., & Najafi, H. (2017). Boundary matters: The potential of system dynamics to support sustainability? Journal of Cleaner Production, 140, 312-323.

Nicoletti Junior, A., Oliveira, M. C., de, Helleno, A. L., & Campos, L. M. (2021). The organization performance framework considering competitiveness and sustainability: The application of the sustainability evaluation model. Production Planning and Control. In press.

Olanipekun, A. O., Omotayo, T., & Saka, N. (2021). Review of the use of Corporate Social Responsibility (CSR) tools. Sustainable Production and Consumption, 27, 425-435.

Orji, I. J., & Wei, S. (2015). An innovative integration of fuzzy-logic and systems dynamics in sustainable supplier selection: A case on manufacturing industry. Computers & Industrial Engineering, 88, 1-12.

Ozcan-Deniz, G., & Zhu, Y. (2016). A system dynamics model for construction method selection with sustainability considerations. Journal of Cleaner Production, 121, 33-44.

Padilla-Lozano, C. P., & Collazzo, P. (2021). Corporate social responsibility, green innovation and competitiveness: causality in manufacturing. Competitiveness Review, 32(7), 21-39.

Pavláková Dočekalová, M., & Kocmanová, A. (2016). Composite indicator for measuring corporate sustainability. Ecological Indicators, 61, 612-623.

Pergelova, A., & Angulo-Ruiz, F. (2013). Marketing and Corporate Social Performance: steering the wheel towards marketing’s impact on society. Social Business, 3(3), 201-224.

Petry, M., Köhler, C., & Zhang, H. (2020). Interaction analysis for dynamic sustainability assessment of manufacturing systems. Procedia CIRP, 90, 477-482.

Petschow, U., Lange, S., Hofmann, H., Pissarskoi, E., aus dem More, N., Korfhage, T., Schookfs, A., & Ott, H. (2020). Social well-being within planetary boundaries: The precautionary post-growth approach (23 p.). Dessau-Roßlau: Federal Environment Agency.

Pinillos, A. A., Fernández-Fernández, J.-L., & Mateo, J. F. (2019). Pasado, presente y futuro de los objetivos del desarrollo sostenible (ODS): la tecnología como catalizador (o inhibidor) de la Agenda 2030. icade. Revista de la Facultad de Derecho, (108), 1-60.

Qudrat-Ullah, H., & Seong, B. (2010). How to do structural validity of a system dynamics type simulation model: the case of an energy policy model. Energy Policy, 38(5), 2216-2224.

Rasmussen, L. V., Rasmussen, K., Reenberg, A., & Proud, S. (2012). A system dynamics approach to land use changes in agro-pastoral systems on the desert margins of Sahel. Agricultural Systems, 107, 56-64.

Reverte, C., Gómez-Melero, E., & Cegarra-Navarro, J. G. (2016). The influence of corporate social responsibility practices on organizational performance: evidence from eco-responsible Spanish firms. Journal of Cleaner Production, 112, 2870-2884.

Revuelto-Taboada, L., Canet-Giner, M. T., & Balbastre-Benavent, F. (2021). High-commitment work practices and the social responsibility issue: interaction and benefits. Sustainability, 13(2), 459.

Rezaee, Z., & Tuo, L. (2019). Are the quantity and quality of sustainability disclosures associated with the innate and discretionary earnings quality? Journal of Business Ethics, 155(3), 763-786.

Rintala, O., Laari, S., Solakivi, T., Töyli, J., Nikulainen, R., & Ojala, L. (2022). Revisiting the relationship between environmental and financial performance: the moderating role of ambidexterity in logistics. International Journal of Production Economics, 248, 108479.

Sari, W. P., Ratnadi N.m.d., Lydia, E. L., Shankar, K., & Wiflihani, W. (2020). Corporate social responsibility (CSR): Concept of the responsibility of the corporations. Journal of Critical Reviews, 7(1).

Schneider, A., & Meins, E. (2012). Two dimensions of corporate sustainability assessment: towards a comprehensive framework. Business Strategy and the Environment, 21(4), 211-222.

Shokravi, S., & Kurnia, S. (2014). A step towards developing a sustainability performance measure within industrial networks. Sustainability, 6(4), 2201-2222.

Shokravi, S., Smith, A. J. R., & Burvill, C. R. (2014). Industrial environmental performance evaluation: a Markov-based model considering data uncertainty. Environmental Modelling & Software, 60, 1-17.

Siew, R. Y. J. (2015). Predicting the behaviour of Australian ESG REITs using Markov chain analysis. Journal of Financial Management of Property and Construction, 20(3), 252-267.

Singh, J. (2016). The influence of CSR and ethical self-identity in consumer evaluation of cobrands. Journal of Business Ethics, 138(2), 311-326.

Sterman, J. D. (2000). Business dynamics systems thinking and modeling for a complex world (1st ed.). Boston: McGraw-Hill.

Thirupathi, R. M., Vinodh, S., & Dhanasekaran, S. (2019). Application of system dynamics modelling for a sustainable manufacturing system of an Indian automotive component manufacturing organisation: a case study. Clean Technologies and Environmental Policy, 21(5), 1055-1071.

Tworzydło, D., Gawroński, S., & Szuba, P. (2021). Importance and role of CSR and stakeholder engagement strategy in polish companies in the context of activities of experts handling public relations. Corporate Social Responsibility and Environmental Management, 28(1), 64-70.

Veronica, S., Alexeis, G.-P., Valentina, C., & Elisa, G. (2020). Do stakeholder capabilities promote sustainable business innovation in small and medium-sized enterprises? Evidence from Italy. Journal of Business Research, 119, 131-141.

Videira, N., Antunes, P., Santos, R., & Lopes, R. (2010). A participatory modelling approach to support integrated sustainability assessment processes. Systems Research and Behavioral Science, 27(4), 446-460.

Waddock, S. A., & Graves, S. B. (1997). The corporate social performance-financial performance link. Strategic Management Journal, 18(4), 303-319.<303::AID-SMJ869>3.0.CO;2-G.

Wood, D. J. (2019). Corporate social performance revisited. Academy of Management Review, 16(4), 691-718.

Xu, Z., & Coors, V. (2012). Combining system dynamics model, GIS and 3D visualization in sustainability assessment of urban residential development. Building and Environment, 47, 272-287.

Zhang, H. (2019). Understanding the linkages: a dynamic sustainability assessment method and decision making in manufacturing systems. Procedia CIRP, 80, 233-238.

Zhang, H., Veltri, A., Calvo-Amodio, J., & Haapala, K. R. (2021). Making the business case for sustainable manufacturing in small and medium-sized manufacturing enterprises: a systems decision making approach. Journal of Cleaner Production, 287, 125038.

Zhao, R., & Zhong, S. (2015). Carbon labelling influences on consumers’ behaviour: a system dynamics approach. Ecological Indicators, 51, 98-106.

Submitted date:

Accepted date:

62d6c17ba953953b1672c983 production Articles
Links & Downloads


Share this page
Page Sections