Abstract
Sustainability has become key for many industries, including the energy sector, which often has negative environmental impacts and overall low sustainability levels. Literature exploring environmental, social and governance (ESG) scores in the energy sector is limited, despite the critical effect of the energy production on sustainability. In light of institutional theory, we select four factors (i.e., energy source used by a firm, firm position in the supply chain (SC), firm geographic location, and firm size) that may influence the strategies and operations of firms in electric power SCs impacting their ESG scores. Five hypotheses on the influence of the four factors on firms’ ESG scores are developed and tested by means of multiple linear regressions on secondary data from the Refinitiv Eikon database. The Nomenclature of Economic Activities classification was applied to determine 416 relevant firms along electric power SCs (i.e., from mining to electricity transmission and distribution firms, with electricity production firms as focal firms) for which data was extracted for the fiscal years 2020 and 2021. Our findings reveal that geographic location and firm size significantly influence ESG scores, while the mix of energy sources influences the environmental performance only and the influence of firm position in the SC remains insignificant. These results are explained within institutional theory perspective. This paper contributes to the literature by highlighting variables that may correlate with the sustainability scores of firms along electric power SCs. Moreover, it assists managers and policymakers in identifying, understanding, and influencing sustainability differences in these SCs.