An assessment of the level of sustainability of Foreign Direct Investments (FDI) of German companies in Latvia

The purpose of this paper is to find out the drivers of and barriers to Foreign Direct Investments (FDI) within the scope of sustainability considerations in order to add new knowledge to the scientific discussion. The sustainability of FDI deserves attention due to the importance of cross-border flows of capital in major fields of the economy and politics. The level of sustainability awareness of investors, however, is not known. Pioneering field research was conducted among 160 German companies in Latvia. Methodologically, a literature review, FDI statistics, primary data from an Internet-based questionnaire, the statistical evaluation of responses with SPSS, and an analysis of correlations measured by Cramér’s V, based on Pearson’s chi-squared statistic, were used. A gap in the scientific literature pertaining to sustainability drivers and outcomes in relation to FDI was addressed. The empirical part disclosed the level of mainstream implementation of sustainability in the operations of German investors in Latvia. The understanding of the sustainability awareness of investors can be used at the level of political decision making in Latvia and other countries in order to promote the sustainability of incoming FDI. A remarkable level of measurable awareness of sustainability issues among German entrepreneurs in Latvia was found. However, there is still room for improvement and further research.