  The assessment of corporate sustainability performance is extremely relevant
in facilitating the transition to a green and low-carbon intensity economy.
However, companies located in different areas may be subject to different
sustainability and environmental risks and policies. Henceforth, the main
objective of this paper is to investigate the spatial and temporal pattern of
the sustainability evaluations of European firms. We leverage on a large
dataset containing information about companies' sustainability performances,
measured by MSCI ESG ratings, and geographical coordinates of firms in Western
Europe between 2013 and 2023. By means of a modified version of the Chavent et
al. (2018) hierarchical algorithm, we conduct a spatial clustering analysis,
combining sustainability and spatial information, and a spatiotemporal
clustering analysis, which combines the time dynamics of multiple
sustainability features and spatial dissimilarities, to detect groups of firms
with homogeneous sustainability performance. We are able to build
cross-national and cross-industry clusters with remarkable differences in terms
of sustainability scores. Among other results, in the spatio-temporal analysis,
we observe a high degree of geographical overlap among clusters, indicating
that the temporal dynamics in sustainability assessment are relevant within a
multidimensional approach. Our findings help to capture the diversity of ESG
ratings across Western Europe and may assist practitioners and policymakers in
evaluating companies facing different sustainability-linked risks in different
areas.
