Interdependence among dimensions of sustainability: Evidence from the Indian leather industry

The purpose of this paper is to investigate the interdependence among dimensions of sustainability, i.e. economic, social and environmental performance, this study focuses on leading states of the Indian leather Industry.

This study followed exploratory research where partial least square (PLS) based structural equation modeling has been used. The states have been selected based on judgmental sampling. The study used unit level data for the leading states of Indian leather Industry − namely, Tamil Nadu (TN), West Bengal and Uttar Pradesh. The study has used Annual Survey of Industry data from 2007-2008 to 2011-2012. The proposed hypotheses have been tested using WarpPLS 5.0 software.

The structural equation analysis of unit-wise leather industry data supports a significant bi-directional negative relationship between social performance and economic performance among all the selected states. In contrast, the relationship between economic performance and environmental performance, as expected and supported by many existing theories, has shown a bidirectional positive relationship. However, the relationship between social and environmental performance has shown quite mysterious and mixed trends. TN has depicted significantly negative coefficients, which could be attributed to higher pressure for environmental compliance that might have led to a trade-off between the two to gain cost competitiveness.

Unavailability of data for many critical indicators is the biggest limitation of this study.

The sustainability framework proposed in this work is an original contribution of authors to the existing literature. Moreover, this study on the Indian leather industry fills the gap and resolves the mystery of interconnection among the dimensions of sustainability.