Research Article
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Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector

Year 2023, Volume: 23 Issue: 3, 341 - 362, 24.07.2023
https://doi.org/10.21121/eab.986122

Abstract

Energy is an important input for production, growth, and development. A sustainable energy sector, where energy production and consumption balance is ensured, constitutes a key point for nature and humanity. In this study, a multidimensional framework is presented to measure corporate sustainability in the energy sector. Based on this framework, the sustainability performance of energy companies operating in the Asia and Europe regions is measured by hybrid multiple-criteria decision-making (MCDM) methods, taking into account the economic, environmental, and social dimensions of sustainability. The Entropy method is used to determine the weights of the criteria, the Proximity Indexed Value (PIV) - Range of Value (ROV) - Grey relational analysis (GRA) - Measurement Alternatives and Ranking according to Compromise Solution (MARCOS) methods are used to rank the alternatives. The Copeland method is used to obtain a single rational ranking from different rankings. Based on the obtained results, it is concluded that energy companies in the Asian region are more sustainable than in the European region. Moreover, Thailand is the most sustainable country in the Asian region. The proposed framework can be contribute to the development of the energy sector.

References

  • Abdel-Basset, M., Ding, W., Mohamed, R. and Metawa, N. (2020). An integrated plithogenic MCDM approach for financial performance evaluation of manufacturing industries. Risk Management, 22: 192-218.
  • Alemi-Ardakani, M., Milani, A.S., Yannacopoulos, S. and Shokouhi, G. (2016). On the effect of subjective, objective and combinative weighting in multiple criteria decision making: a case study on impact optimization of composites. Expert Systems with Applications, 46:426-438.
  • Ali, T., Ma, H. and Nahian, A. J. (2019). An analysis of the renewable energy technology selection in the southern region of Bangladesh using a hybrid multi-criteria decision making (MCDM) method. International Journal of Renewable Energy Research (IJRER), 9:1838-1848.
  • Alizadeh, R., Soltanisehat, L., Lund, P. D. and Zamanisabzi, H. (2020). Improving renewable energy policy planning and decision-making through a hybrid MCDM method. Energy Policy, 137:1-17.
  • Chowdhury, P. and Paul, S. K. (2020). Applications of MCDM methods in research on corporate sustainability. Management of Environmental Quality: An International Journal, 31:385-405.
  • Clausius, R. (1865). Ueber verschiedene für die anwendung bequeme formen der hauptgleichungen der mechanischen wärmetheorie. Annalen der Physik, 201(7):353-400.
  • Cui, L., Zhai, M., Dai, J., Liu, Y. and Zhang, P. (2019). Assessing sustainability performance of high-tech firms through a hybrid approach. Industrial Management & Data Systems, 119:1581-1607.
  • Deepa, N., Ganesan, K., Srinivasan, K. and Chang, C. Y. (2019). Realizing sustainable development via modified integrated weighting MCDM model for ranking agrarian dataset. Sustainability, 11:1-20.
  • Edenhofer, O., Pichs-Madruga, R., Sokona, Y., Seyboth, K., Matschoss, P., Kadner, S.,... Stechow, C. (2011). Renewable Energy Sources and Climate Change Mitigation. First Edition, (1-1059) Cambridge: Cambridge University Press.
  • Favardin, P., Lepelley, D. and Serais, J. (2002). Borda rule, copeland method and strategic manipulation. Review of Economic Design, 7:213-228.
  • Ghasemi, A. and Nadiri, M. (2016). Performance assessment of iranian petrochemical companies using sustainable excellence model. Safety Science, 87:280-291.
  • González, M. F., García, Á. L. F., Salomon, V. A. P., Marx-Gómez, J. and Hernández, C. T. (2016). Sustainability performance measurement with analytic network process and balanced scorecard: cuban practical case. Production, 26:527-539.
  • Ishfaq, S., Ali, S. and Ali, Y. (2018). Selection of optimum renewable energy source for energy sector in Pakistan by using MCDM approach. Process Integration and Optimization for Sustainability, 2:61-71.
  • Johansson, T. B., Kelly, H., Reddy, A. K. N. and Williams, R. H. (1992). Renewable fuels and elecricity for a growing world economy: defining and achieving the potantial. Energy Studies Review, 4:201-212.
  • Kumar, G. and Parimala, N. (2019). A sensitivity analysis on weight sum method MCDM approach for product recommendation. International Conference on Distributed Computing and Internet Technology, Bhubaneswar, India, 185-193.
  • Li, W., Ren, X., Ding, S. and Dong, L. (2020). A multi-criterion decision making for sustainability assessment of hydrogen production technologies based on objective grey relational analysis. International Journal of Hydrogen Energy, 45(59):1-11.
  • Madić, M., Radovanović, M. and Manić, M. (2016). Application of the ROV method for the selection of cutting fluids. Decision Science Letters, 5:245-254.
  • Madić, M. and Radovanović, M. (2015). Ranking of some most commonly used non-traditional machining processes using ROV and CRITIC methods. UPB Scientific bulletin, Series D: Mechanical Engineering, 77(2):193-204.
  • Mao, R. J., You, J. X., Duan, C. Y. and Shao, L. N. (2019). A heterogeneous MCDM framework for sustainable supplier evaluation and selection based on the IVIF-TODIM method. Sustainability, 11:1-16.
  • Mishra, D. and Satapathy, S. (2019). An Integrated MCDM and Ergonomic Approach for Agricultural Sectors of Odisha in India: A Critical Analysis for Farming Sustainability. In Advanced Multi-Criteria Decision Making for Addressing Complex Sustainability Issues, Chatterjee,P.,Yazdani,M.,Chakraborty,S., Panchal,D., Bhattacharyya, S., Eds.; IGI Global: USA, 181-221.
  • Mufazzal, S. and Muzakkir, S. M. A. (2018). New multi-criterion decision making (MCDM) method based on proximity indexed value for minimizing rank reversals. Computers & Industrial Engineering, 119:427-438.
  • Naderi, H., Shahhoseini, S.H. and Jafari, A. H. (2013). Evaluation MCDM multi-disjoint paths selection algorithms using fuzzy-copeland ranking method. International Journal of Communication Networks and Information Security, 5:59-67.
  • Owusu, P. A. and Asumadu-Sarkodie, S. A. (2016). A review of renewable energy sources. sustainability issues and climate change mitigation. Cogent Engineering, 3:1-14.
  • Prentkovskis, O., Erceg, Ž., Stević, Ž., Tanackov, I., Vasiljević, M. and Gavranović, M.. (2018). A new methodology for improving service quality measurement: Delphi-FUCOM-SERVQUAL model. Symmetry, 10:1-25.
  • Randolph, J. and Masters, G. M. (2008). Energy for Sustainability: Technology, Planning, Policy. Second Edition, (1-637), Island Press, USA.
  • San Cristóbal, J. R. (2011). Multi-criteria decision-making in the selection of a renewable energy project in Spain: the Vikor method. Renewable Energy, 36: 498-502.
  • Siksnelyte-Butkiene, I., Zavadskas, E. K. and Streimikiene, D. (2020). Multi-criteria decision-making (MCDM) for the assessment of renewable energy technologies in a household: a review. Energies, 13:1-22.
  • Singh, M., Pant, M., Godiyal, R. D. and Kumar Sharma, A. (2020). MCDM approach for selection of raw material in pulp and papermaking industry. Materials and Manufacturing Processes, 35:241-249.
  • Stević, Ž., Pamučar, D., Puška, A. and Chatterjee, P. (2020). Sustainable supplier selection in healthcare industries using a new MCDM method: measurement of alternatives and ranking according to compromise solution (MARCOS). Computers & Industrial Engineering, 140:1-15.
  • Tadić, S., Krstić, M., Roso, V. and Brnjac, N. (2020). Dry port terminal location selection by applying the hybrid grey mcdm model. Sustainability, 12:1-24.
  • Vivas, R., Sant’anna, Â., Esquerre, K. and Freires, F. (2019). Measuring sustainability performance with multi criteria model: a case study. Sustainability, 11:1-13.
  • Wang, C. H. and Tong, L. I. (2004). Optimization of dynamic multi-response problems using grey multiple attribute decision making. Quality Engineering, 17:1-9.
  • Wang, C. N., Nguyen, V. T., Thai, H. T. N. and Duong, D. H. (2018). Multi-criteria decision making (MCDM) approaches for solar power plant location selection in Vietnam. Energies, 11:1-27.
  • Wang, T. C. and Lee, H. D. (2009). Developing a fuzzy TOPSIS approach based on subjective weights and objective weights. Expert Systems with Applications, 36:8980-8985.
  • Wicher, P., Zapletal, F. and Lenort, R. (2019). Sustainability performance assessment of industrial corporation using fuzzy analytic network process. Journal of Cleaner Production, 241:1-14.
  • Wu, H. H. (2002). A comparative study of using grey relational analysis in multiple attribute decision making problems. Quality Engineering, 15:209-217.
  • Yakowitz, D. S., Lane, L. J. and Szidarovszky, F. (1993). Multi-attribute decision making: dominance with respect to an ımportance order of the attributes. Applied Mathematics and Computation, 54:167-181.
  • Yannis, G., Kopsacheili, A., Dragomanovits, A. and Petraki, V. (2020). State-of-the-art review on multi-criteria decision-making in the transport sector. Journal of Traffic and Transportation Engineering, 7:413-431.
  • Yi, P., Li, W. And Zhang, D. (2019). Assessment of city sustainability using MCDM with ınterdependent criteria weight. Sustainability, 11:1-20.
  • Zavadskas, E.K. and Podvezko, V. (2016). Integrated determination of objective criteria weights in MCDM. International Journal of Information Technology & Decision Making, 15:267-283.
  • Zhai, L. Y., Khoo, L. P. and Zhong, Z. W. (2009). Design concept evaluation in product development using rough sets and grey relation analysis. Expert Systems with Applications, 36:7072–7079.
  • Zhang, H., Gu, C., Gu, L. and Zhang, Y. (2011). The evaluation of tourism destination competitiveness by topsis & information entropy - a case in the yangtze river delta of china. Tourism Management, 32:443-451.
  • Zhang, X., Wang, C., Li, E. and Xu, C. (2014). Assessment model of eco-environmental vulnerability based on improved entropy weight method. The Scientific World Journal, 2014:1-7.
Year 2023, Volume: 23 Issue: 3, 341 - 362, 24.07.2023
https://doi.org/10.21121/eab.986122

Abstract

References

  • Abdel-Basset, M., Ding, W., Mohamed, R. and Metawa, N. (2020). An integrated plithogenic MCDM approach for financial performance evaluation of manufacturing industries. Risk Management, 22: 192-218.
  • Alemi-Ardakani, M., Milani, A.S., Yannacopoulos, S. and Shokouhi, G. (2016). On the effect of subjective, objective and combinative weighting in multiple criteria decision making: a case study on impact optimization of composites. Expert Systems with Applications, 46:426-438.
  • Ali, T., Ma, H. and Nahian, A. J. (2019). An analysis of the renewable energy technology selection in the southern region of Bangladesh using a hybrid multi-criteria decision making (MCDM) method. International Journal of Renewable Energy Research (IJRER), 9:1838-1848.
  • Alizadeh, R., Soltanisehat, L., Lund, P. D. and Zamanisabzi, H. (2020). Improving renewable energy policy planning and decision-making through a hybrid MCDM method. Energy Policy, 137:1-17.
  • Chowdhury, P. and Paul, S. K. (2020). Applications of MCDM methods in research on corporate sustainability. Management of Environmental Quality: An International Journal, 31:385-405.
  • Clausius, R. (1865). Ueber verschiedene für die anwendung bequeme formen der hauptgleichungen der mechanischen wärmetheorie. Annalen der Physik, 201(7):353-400.
  • Cui, L., Zhai, M., Dai, J., Liu, Y. and Zhang, P. (2019). Assessing sustainability performance of high-tech firms through a hybrid approach. Industrial Management & Data Systems, 119:1581-1607.
  • Deepa, N., Ganesan, K., Srinivasan, K. and Chang, C. Y. (2019). Realizing sustainable development via modified integrated weighting MCDM model for ranking agrarian dataset. Sustainability, 11:1-20.
  • Edenhofer, O., Pichs-Madruga, R., Sokona, Y., Seyboth, K., Matschoss, P., Kadner, S.,... Stechow, C. (2011). Renewable Energy Sources and Climate Change Mitigation. First Edition, (1-1059) Cambridge: Cambridge University Press.
  • Favardin, P., Lepelley, D. and Serais, J. (2002). Borda rule, copeland method and strategic manipulation. Review of Economic Design, 7:213-228.
  • Ghasemi, A. and Nadiri, M. (2016). Performance assessment of iranian petrochemical companies using sustainable excellence model. Safety Science, 87:280-291.
  • González, M. F., García, Á. L. F., Salomon, V. A. P., Marx-Gómez, J. and Hernández, C. T. (2016). Sustainability performance measurement with analytic network process and balanced scorecard: cuban practical case. Production, 26:527-539.
  • Ishfaq, S., Ali, S. and Ali, Y. (2018). Selection of optimum renewable energy source for energy sector in Pakistan by using MCDM approach. Process Integration and Optimization for Sustainability, 2:61-71.
  • Johansson, T. B., Kelly, H., Reddy, A. K. N. and Williams, R. H. (1992). Renewable fuels and elecricity for a growing world economy: defining and achieving the potantial. Energy Studies Review, 4:201-212.
  • Kumar, G. and Parimala, N. (2019). A sensitivity analysis on weight sum method MCDM approach for product recommendation. International Conference on Distributed Computing and Internet Technology, Bhubaneswar, India, 185-193.
  • Li, W., Ren, X., Ding, S. and Dong, L. (2020). A multi-criterion decision making for sustainability assessment of hydrogen production technologies based on objective grey relational analysis. International Journal of Hydrogen Energy, 45(59):1-11.
  • Madić, M., Radovanović, M. and Manić, M. (2016). Application of the ROV method for the selection of cutting fluids. Decision Science Letters, 5:245-254.
  • Madić, M. and Radovanović, M. (2015). Ranking of some most commonly used non-traditional machining processes using ROV and CRITIC methods. UPB Scientific bulletin, Series D: Mechanical Engineering, 77(2):193-204.
  • Mao, R. J., You, J. X., Duan, C. Y. and Shao, L. N. (2019). A heterogeneous MCDM framework for sustainable supplier evaluation and selection based on the IVIF-TODIM method. Sustainability, 11:1-16.
  • Mishra, D. and Satapathy, S. (2019). An Integrated MCDM and Ergonomic Approach for Agricultural Sectors of Odisha in India: A Critical Analysis for Farming Sustainability. In Advanced Multi-Criteria Decision Making for Addressing Complex Sustainability Issues, Chatterjee,P.,Yazdani,M.,Chakraborty,S., Panchal,D., Bhattacharyya, S., Eds.; IGI Global: USA, 181-221.
  • Mufazzal, S. and Muzakkir, S. M. A. (2018). New multi-criterion decision making (MCDM) method based on proximity indexed value for minimizing rank reversals. Computers & Industrial Engineering, 119:427-438.
  • Naderi, H., Shahhoseini, S.H. and Jafari, A. H. (2013). Evaluation MCDM multi-disjoint paths selection algorithms using fuzzy-copeland ranking method. International Journal of Communication Networks and Information Security, 5:59-67.
  • Owusu, P. A. and Asumadu-Sarkodie, S. A. (2016). A review of renewable energy sources. sustainability issues and climate change mitigation. Cogent Engineering, 3:1-14.
  • Prentkovskis, O., Erceg, Ž., Stević, Ž., Tanackov, I., Vasiljević, M. and Gavranović, M.. (2018). A new methodology for improving service quality measurement: Delphi-FUCOM-SERVQUAL model. Symmetry, 10:1-25.
  • Randolph, J. and Masters, G. M. (2008). Energy for Sustainability: Technology, Planning, Policy. Second Edition, (1-637), Island Press, USA.
  • San Cristóbal, J. R. (2011). Multi-criteria decision-making in the selection of a renewable energy project in Spain: the Vikor method. Renewable Energy, 36: 498-502.
  • Siksnelyte-Butkiene, I., Zavadskas, E. K. and Streimikiene, D. (2020). Multi-criteria decision-making (MCDM) for the assessment of renewable energy technologies in a household: a review. Energies, 13:1-22.
  • Singh, M., Pant, M., Godiyal, R. D. and Kumar Sharma, A. (2020). MCDM approach for selection of raw material in pulp and papermaking industry. Materials and Manufacturing Processes, 35:241-249.
  • Stević, Ž., Pamučar, D., Puška, A. and Chatterjee, P. (2020). Sustainable supplier selection in healthcare industries using a new MCDM method: measurement of alternatives and ranking according to compromise solution (MARCOS). Computers & Industrial Engineering, 140:1-15.
  • Tadić, S., Krstić, M., Roso, V. and Brnjac, N. (2020). Dry port terminal location selection by applying the hybrid grey mcdm model. Sustainability, 12:1-24.
  • Vivas, R., Sant’anna, Â., Esquerre, K. and Freires, F. (2019). Measuring sustainability performance with multi criteria model: a case study. Sustainability, 11:1-13.
  • Wang, C. H. and Tong, L. I. (2004). Optimization of dynamic multi-response problems using grey multiple attribute decision making. Quality Engineering, 17:1-9.
  • Wang, C. N., Nguyen, V. T., Thai, H. T. N. and Duong, D. H. (2018). Multi-criteria decision making (MCDM) approaches for solar power plant location selection in Vietnam. Energies, 11:1-27.
  • Wang, T. C. and Lee, H. D. (2009). Developing a fuzzy TOPSIS approach based on subjective weights and objective weights. Expert Systems with Applications, 36:8980-8985.
  • Wicher, P., Zapletal, F. and Lenort, R. (2019). Sustainability performance assessment of industrial corporation using fuzzy analytic network process. Journal of Cleaner Production, 241:1-14.
  • Wu, H. H. (2002). A comparative study of using grey relational analysis in multiple attribute decision making problems. Quality Engineering, 15:209-217.
  • Yakowitz, D. S., Lane, L. J. and Szidarovszky, F. (1993). Multi-attribute decision making: dominance with respect to an ımportance order of the attributes. Applied Mathematics and Computation, 54:167-181.
  • Yannis, G., Kopsacheili, A., Dragomanovits, A. and Petraki, V. (2020). State-of-the-art review on multi-criteria decision-making in the transport sector. Journal of Traffic and Transportation Engineering, 7:413-431.
  • Yi, P., Li, W. And Zhang, D. (2019). Assessment of city sustainability using MCDM with ınterdependent criteria weight. Sustainability, 11:1-20.
  • Zavadskas, E.K. and Podvezko, V. (2016). Integrated determination of objective criteria weights in MCDM. International Journal of Information Technology & Decision Making, 15:267-283.
  • Zhai, L. Y., Khoo, L. P. and Zhong, Z. W. (2009). Design concept evaluation in product development using rough sets and grey relation analysis. Expert Systems with Applications, 36:7072–7079.
  • Zhang, H., Gu, C., Gu, L. and Zhang, Y. (2011). The evaluation of tourism destination competitiveness by topsis & information entropy - a case in the yangtze river delta of china. Tourism Management, 32:443-451.
  • Zhang, X., Wang, C., Li, E. and Xu, C. (2014). Assessment model of eco-environmental vulnerability based on improved entropy weight method. The Scientific World Journal, 2014:1-7.
There are 43 citations in total.

Details

Primary Language English
Subjects Business Administration
Journal Section Research Article
Authors

Nazlı Ersoy 0000-0003-0011-2216

Soner Taslak 0000-0002-6895-8915

Early Pub Date July 4, 2023
Publication Date July 24, 2023
Acceptance Date August 29, 2022
Published in Issue Year 2023 Volume: 23 Issue: 3

Cite

APA Ersoy, N., & Taslak, S. (2023). Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector. Ege Academic Review, 23(3), 341-362. https://doi.org/10.21121/eab.986122
AMA Ersoy N, Taslak S. Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector. ear. July 2023;23(3):341-362. doi:10.21121/eab.986122
Chicago Ersoy, Nazlı, and Soner Taslak. “Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector”. Ege Academic Review 23, no. 3 (July 2023): 341-62. https://doi.org/10.21121/eab.986122.
EndNote Ersoy N, Taslak S (July 1, 2023) Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector. Ege Academic Review 23 3 341–362.
IEEE N. Ersoy and S. Taslak, “Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector”, ear, vol. 23, no. 3, pp. 341–362, 2023, doi: 10.21121/eab.986122.
ISNAD Ersoy, Nazlı - Taslak, Soner. “Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector”. Ege Academic Review 23/3 (July 2023), 341-362. https://doi.org/10.21121/eab.986122.
JAMA Ersoy N, Taslak S. Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector. ear. 2023;23:341–362.
MLA Ersoy, Nazlı and Soner Taslak. “Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector”. Ege Academic Review, vol. 23, no. 3, 2023, pp. 341-62, doi:10.21121/eab.986122.
Vancouver Ersoy N, Taslak S. Comparative Analysis of MCDM Methods for the Assessment of Corporate Sustainability Performance in Energy Sector. ear. 2023;23(3):341-62.