Does the economic motivation of firms to address the United Nations' Sustainable Development Goals (SDGs) promote the SDGs or merely SDG-washing? Critical empirical evidence from Japan and Vietnam

The United Nations' Sustainable Development Goals (SDGs) call on all firms to apply their creativity and innovation to solving sustainable development challenges. There is then an argument that firms should address the SDGs by applying the creating shared value (CSV) framework. However, we cannot exclude the possibility that this is nothing more than "business as usual" implemented in the name of the SDGs, or so-called SDG-washing, thereby limiting firm contributions to the SDGs. Although the SDG Compass, the most referenced business guideline on SDGs, currently encourages firms to address the SDGs using their economic motivation, it is uncertain whether it provides the right direction for achieving them. The purpose of this study is to address whether the economic motivation of firms to achieve the SDGs is practically preferable in contrast to the ethical motivation. Using data on Japanese and Vietnamese firms, we empirically analyse whether the degree of a firm's proactiveness to address the SDGs depends on its economic and/or ethical motivations from a stakeholder management perspective. Our estimation results clarify that an ethical motivation continues to play a more significant role for firms in addressing the SDGs. Put differently, while CSV appears an attractive framework for firms to address the SDGs, its actual contribution remains partial and tentative, and it has thus been criticized for overemphasizing any economic motivation that potentially promotes SDG-washing. It is important to note that this could also ultimately decrease economic value by harming the firm's reputation.