Impact of Green Human Resource Management on Firm’s Valuation- A Study on FMCG Companies

Article Sidebar

Main Article Content

Dr. Abhisek Saha Roy
Department of Management Studies, Calcutta Business School
Rashmi Kiran
Department of Management Studies, Calcutta Business School
Suchetana Singh
Department of Management Studies, Calcutta Business School
Published: Jul 5, 2025

Abstract- In the dynamic corporate environment, environmental sustainability has emerged as a pivotal factor influencing organizational success. Green Human Resource Management (GHRM) has been recognized as a strategic method to synchronize human resource policies with environmental goals, thereby improving organizational performance and valuation. This research examines the effects of GHRM practices on the valuation of Fast-Moving Consumer Goods (FMCG) companies, utilizing the Ability-Motivation-Opportunity (AMO) framework. A purposive sample of 14 FMCG companies listed in the Nifty 100 is analysed, with data spanning from 2019-2020 to 2023-2024, employing content analysis to evaluate the impact of GHRM components on firm valuation, as indicated by market capitalization. The research underscores the role of green HR practices, including green recruitment, training, and reward systems, in enhancing employee capabilities, fostering eco-friendly motivation, and creating opportunities for sustainable engagement. To address the objective the study has undertaken the wide usage of content analysis to quantify the aspects of the AMO framework from the company’s annual report and has executed the regression equation using the balanced panel framework. The results indicate a significant relationship between a few GHRM initiatives, namely recruitment & selection, pay, organizational culture, decision-making, and firm valuation, highlighting their strategic significance in tackling environmental issues, improving brand reputation, and promoting long-term competitiveness. This study enhances the comprehension of GHRM within the FMCG sector and provides practical recommendations for organizations aiming to incorporate sustainability into their human resource strategies.
Impact of Green Human Resource Management on Firm’s Valuation- A Study on FMCG Companies. (2025). International Journal of Latest Technology in Engineering Management & Applied Science, 14(6), 181-190. https://doi.org/10.51583/IJLTEMAS.2025.140600024

Downloads

References

Kandel, S., Thapa, K., & Paudel, P. (2024). Green human resource management practices and initiatives on organizational performance: A review perspective. Kalika Journal of Multidisciplinary Research, 2(1), 116-135. https://doi.org/10.3126/kjmr.v2i1.71055

Frederik Pradana Deniswara, & Sopiah Sopiah. (2023). A green human resources management: A systematic literature review (SLR). Sammajiva: Jurnal Penelitian Bisnis dan Manajemen, 1(4), 322-334. https://doi.org/10.47861/sammajiva.v1i4.570

Subono, A., & Kurnisa, U. (2024). Green business: A review based green HRM. KnE Social Sciences. https://doi.org/10.18502/kss.v9i17.16375

Marditama, T., Yusliza, M. Y., & Purnomo, A. K. (2024). The link between green human resource management and environmental performance through green innovation practices: A mini literature review during year 2019-2023. jesya,7(2),1317-1331. https://doi.org/10.36778/jesya.v7i2.1581

Xie, H., & Lau, T. C. (2023). Evidence-based green human resource management: A systematic literature review. Sustainability, 15(14), 10941. https://doi.org/10.3390/su151410941

Assessing the influence of green HR strategies on company sustainability and employee job continuity. (2023). Pakistan Social Sciences Review, 7(IV). https://doi.org/10.35484/pssr.2023(7-iv)25

Dumitriu, S., Ploscaru, A., & Ghita, R. (2023). Evaluating the effects of employee recruitment and selection practices on the organizational change process. Ovidius University Annals. Economic Sciences Series, 23(1), 611-616. https://doi.org/10.61801/ouaess.2023.1.79

Al-shahwani, T. M. (2020). Impact of AMO enhancing human resource management practices on sustainable competitive advantage in insurance companies in Qatar. Management Science Letters, 1827-1834. https://doi.org/10.5267/j.msl.2019.12.036

Basalamah, J., Syahnur, M. H., & Basalamah, A. (2020). Recruitment and selection practice on Indonesia state-owned enterprise: A literature review. Manajemen Bisnis, 10(2). https://doi.org/10.22219/jmb.v10i2.13093

Dumitriu, S., Ploscaru, A., & Ghita, R. (2023). Evaluating the effects of employee recruitment and selection practices on the organizational change process. Ovidius University Annals. Economic Sciences Series, 23(1), 611-616. https://doi.org/10.61801/ouaess.2023.1.79

Stofkova, Z., & Hraskova, D. (2020). Company personnel policy as part of new management approaches in globalization. SHS Web of Conferences, 74, 04028. https://doi.org/10.1051/shsconf/20207404028

Madden, B. J. (2017). The purpose of the firm, valuation, and the management of intangibles. Journal of Applied Corporate Finance, 29(2), 76-86. https://doi.org/10.1111/jacf.12235

Sanin, V. V. (2011). Financial stakeholder- Approach to implementation and external analysis of corporate strategy: Methodical realization of enlightened value seeking. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1890389

Ofori, D., & Aryeetey, M. (2011). Recruitment and selection practices in small and medium enterprises: Perspectives from Ghana. International Journal of Business Administration, 2(3). https://doi.org/10.5430/ijba.v2n3p45

Knaeple, F. (2017). Return of human capital development and training investments on corporate valuation. Student Undergraduate Research E-Journal!, 3, 25–28. https://doi.org/10.25609/sure.v3.2517

Dhar, S. K. (2022). A study on invest-worthiness of few selected Indian FMCG companies with specific emphasis on their financials and capital market performances. JOURNAL OF ACADEMIC ADVANCEMENT, 1(1),25-28. https://doi.org/10.58574/jaa.2022.v1.i1.05

James, J., Park. (2021). From Managers to Markets: Valuation and Shareholder Wealth Maximization. Social Science Research Network [Doctoral dissertation]. ProQuest Dissertations and Theses Global.

Madden, B. J. (2017). The purpose of the firm, valuation, and the management of intangibles. Journal of Applied Corporate Finance, 29(2), 76-86. https://doi.org/10.1111/jacf.12235

Schmidlin, N. (2014). The art of company valuation and financial statement analysis: A value investor's guide with real-life case studies. John Wiley & Sons.

Wibowo, P. (2024). The impact of human resource practices on shareholder value. Atestasi : Jurnal Ilmiah Akuntansi, 7(2), 795-809. https://doi.org/10.57178/atestasi.v7i2.882

Xirogiannis, G., Chytas, P., Glykas, M., & Valiris, G. (2008). Intelligent impact assessment of HRM to the shareholder value. Expert Systems with Applications, 35(4), 2017-2031. https://doi.org/10.1016/j.eswa.2007.08.103

Weichselbraun, A., Kuntschik, P., & Hörler, S. (2020). Optimierung von Unternehmensbewertungen durch automatisierte Wissensidentifikation, -extraktion und -integration. Information - Wissenschaft & Praxis, 71(5-6), 321-325. https://doi.org/10.1515/iwp-2020-2119

Madden, B. J. (2017). The purpose of the firm, valuation, and the management of intangibles. Journal of Applied Corporate Finance, 29(2), 76-86. https://doi.org/10.1111/jacf.12235

Sumiati, S., Wijayanti, R., Yuana, P., & Nikmah, C. (2022). Improving company value: The role of human capital, structural capital, capital employed, investment decisions, and manager's attitude to risk. BISMA (Bisnis dan Manajemen), 14(2), 110-123. https://doi.org/10.26740/bisma.v14n2.p110-123

Wijnhoven, F. (2001). A framework for stakeholder-based knowledge valuation in organizations. Knowledge Management and Business Model Innovation, 298-315. https://doi.org/10.4018/978-1-878289-98-8.ch017

Yaumi, S., Farid Dedyansyah, A., Berlyn Hakim, M., & Majid, A. (2024). Gcg sebagai pemoderasi pengaruh profitabilitas, perencanaan Pajak terhadap nilai perusahaan. Jurnal Analisa Akuntansi dan Perpajakan, 8(1), 1-12. https://doi.org/10.25139/jaap.v8i1.7380

Joao, Marcelo, Alves. (2008). Determining knowledge-intensive companies acquisition value for M&A purposes : an intellectual capital approach. Portuguese Journal of management Studies, 13(3):385-402

Maddali, Ravi Kiran, Status of Supply Chain Finance in FMCG Companies - A Benchmarking Approach (July 19, 2013). Available at SSRN: https://ssrn.com/abstract=2349774. (n.d.). https://ssrn.com/abstract=2349774

Priyanka, & Singh, R. (2023). Investigating debt ratios and their determinants in the capital structure of Indian fmcg companies: An empirical study. ShodhKosh: Journal of Visual and Performing Arts, 3(2). https://doi.org/10.29121/ shodhkosh.v3.i2.2022.2514

Saji, T., & Eldhose, K. (2017). Capital intensity, financial leverage and market valuations in India: Evidence from a panel of FMCG firms. Asian Journal of Management, 8(4), 1037. https://doi.org/10.5958/2321-5763.2017.00159.7

Schäfer, H. (2019). Understanding how stakeholders are affecting sustainability and finance. SpringerBriefs in Finance, 61-70. https://doi.org/10.1007/978-3-030-04684-2_5

“Status of supply chain finance in FMCG companies- a benchmarking approach” Munich personal RePEc archive. (2013, July 19). Munich Personal RePEc Archive. https://mpra.ub.uni-muenchen.de/id/eprint/51261

Jung, H. W., Subramanian, A., & Zeng, Q. (2016). Ownership structure, incentives, and asset prices. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2880261

Arquisola, M. J., & Walid Ahlisa, S. U. (2019). Do learning and development interventions motivate employees at PT Danone Indonesia? Applying McClelland’s theory of motivation to FMCG industries. FIRM Journal of Management Studies, 4(2), 160. https://doi.org/10.33021/firm.v4i2.780

Chen, J. (2022). Employees motivation mechanism in fast moving consumer goods industry—Case of Procter & Gamble. Advances in Economics, Business and Management Research. https://doi.org/10.2991/aebmr.k.220307.003

Lee, Y., Kim, S., & Kim, S. Y. (2013). The impact of internal branding on employee engagement and outcome variables in the hotel industry. Asia Pacific Journal of Tourism Research, 19(12), 1359-1380. https://doi.org/10.1080/10941665.2013.863790

Limitovskiy, M. A. (2009). Reputation, qualification and motivation as value drivers. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1496943

Xia, H. (2023). The impact of equity incentives on the performance of listed companies. Frontiers in Business, Economics and Management, 11(2),179-187. https://doi.org/10.54097/fbem.v11i2.12586

Anusree, S., & Lorene, K. M. (2022). Study of financial performance of five selected FMCG companies in India. International journal of health sciences. https://doi.org/10.53730/ijhs.v6ns1.7864

Dahlquist, M., & Ibert, M. (2024). Equity return expectations and portfolios: Evidence from large asset managers. The Review of Financial Studies, 37(6), 1887-1928. https://doi.org/10.1093/rfs/hhae008

Dr .Padmasani, D. .., & R. Vijayalakshmi, R. V. (2012). Determinants of wealth maximisation in FMCG sector. International Journal of Scientific Research, 2(9), 37-40. https://doi.org/10.15373/22778179/sep2013/14

Keppo, J., Touzi, N., & Ruiting, Z. (2021). Dynamic contracting in asset management under investor-partner-Manager relationship. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3761499

Mathe, H., Pavie, X., & O'Keeffe, M. (2011). Valuing people to create value. https://doi.org/10.1142/9789814365079

Merlin, M., Ardhanareswari, P. K., Hastika, Y., & Rohman, A. (2024). The impact of employee engagement and employee motivation on employee turnover intention and the mediating role of organizational commitment. WSEAS TRANSACTIONS ON BUSINESS AND ECONOMICS, 21, 512-527. https://doi.org/10.37394/23207.2024.21.43

Venkatachalam, A., & Nalini, G. S. (2022). Valuation of top three FMCG companies in India. Indian Journal of Finance, 16(7), 57. https://doi.org/10.17010/ijf/2022/v16i7/170654

Бунеева, Р., Гаврилюк, С., & Звягина, Н. (2022). Using the innovative potential of international fmcg companies for the development of regional consumer markets. Вестник Сибирского университета потребительской кооперации, (1(39)), 56-66. https://doi.org/10.48642/2305-7408.2022.46.16.006

Mohindroo, Amit, and Sureet Singh. "Factors affecting investment in mutual funds-An exploratory study." SAARJ Journal on Banking & Insurance Research 2, no. 3 (2013): 1-24.

Dahlquist, M., & Ibert, M. (2024). Equity return expectations and portfolios: Evidence from large asset managers. The Review of Financial Studies, 37(6), 1887-1928. https://doi.org/10.1093/rfs/hhae008

Keppo, J., Touzi, N., & Ruiting, Z. (2021). Dynamic contracting in asset management under investor-partner-Manager relationship. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3761499

Liczmańska-Kopcewicz, K., Mizera, K., & Pypłacz, P. (2019). Corporate social responsibility and sustainable development for creating value for FMCG sector enterprises. Sustainability, 11(20), 5808. https://doi.org/10.3390/su11205808

Ryan, G. W., & Bernard, H. R. (2003). Techniques to identify themes. Field Methods, 15(1), 85-109. https://doi.org/10.1177/1525822x02239569

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

All articles published in our journal are licensed under CC-BY 4.0, which permits authors to retain copyright of their work. This license allows for unrestricted use, sharing, and reproduction of the articles, provided that proper credit is given to the original authors and the source.

Article Details

How to Cite

Impact of Green Human Resource Management on Firm’s Valuation- A Study on FMCG Companies. (2025). International Journal of Latest Technology in Engineering Management & Applied Science, 14(6), 181-190. https://doi.org/10.51583/IJLTEMAS.2025.140600024