The Subliminal Ledger: Measuring and Reporting Corporate Culture's Influence on Social Sustainability

ABSTRACT Over the past three decades, global discourse has prominently revolved around sustainability, with discussions centered on the environmental dimension. The social aspect has remained overlooked by both corporations and policymakers. In the realm of addressing social sustainability within companies, it is imperative to assess the crucial role of corporate culture. This study makes a pioneering attempt to empirically investigate the associations of four subcultures—competition, creation, collaboration, and control—as measured using the Competing Values Framework (CVF), with corporate social sustainability (CSS). Analyzing the data from 2688 10‐K reports of 384 US companies listed on the S&P 500 Index between 2016 and 2022, we employed a robust methodology entailing advanced textual analysis to measure the cultural dimensions and flexible pseudo maximum likelihood estimation (Flex) to account for the double‐bounded nature of the social sustainability dependent variable. The study revealed a positive correlation between only the “creation” culture and social sustainability, while “competition” and “collaboration” showed a negative association. Furthermore, with the introduction of board variables, the insignificant role of “control” culture recontextualized into a negative and significant association. The significance of subculture parameters highlights the necessity for corporate culture to be delineated as a distinct construct within sustainability academic and practitioner dialogue. This highlights the imperative for leadership to prioritize and bolster their support for social sustainability within bureaucratic cultures. Implications for policymakers, managers, and society are detailed, emphasizing the need to shift the focus to global discussions on achieving social sustainability at the firm level through corporate subcultural transformations. This study advocates building creation‐oriented cultures within organizations to augment social sustainability.