Beyond Profit: The Role of Economic, Social, and Political Aspects in Business Feasibility Studies

Ardianta Selasa, September 08, 2026
Gambar Ilustrasi AI
FORMOSA NEWS

Integrated Economic, Social, and Political Dimensions Redefine Long-Term Business Feasibility Frameworks Beyond Financial Metrics

Evaluating business feasibility through a combined framework of economic dynamics, social legitimacy, and political certainty determines the long-term viability of investment projects far better than relying solely on traditional financial metrics. A 2026 study conducted by Dwi Pertiwi, Najla Umayra, Hilda Tri Amanda, and Linda Sari Mutiara Ritonga from Panca Budi Development University in Medan, Indonesia, demonstrates how non-financial environmental dimensions actively shape investment outcomes. Published in the International Journal of Contemporary Sciences (IJCS), the research presents an integrated conceptual model that helps corporate leaders and investors mitigate external risks that financial projections fail to anticipate.

Context and Background in Modern Business Evaluation

In an increasingly volatile global economy driven by rapid technological change, shifting consumer expectations, and evolving regulatory mandates, feasibility assessments serve as critical decision-making tools for capital allocation. Traditionally, organizations evaluate potential ventures primarily through financial metrics such as net present value, internal rate of return, and projected profit margins.

However, modern business environments reveal that projects with strong financial forecasts frequently fail or suffer severe operational disruptions due to public backlash, regulatory changes, or institutional instability. Ignoring macro-environmental variables creates significant strategic vulnerabilities. A complete assessment of business viability requires expanding traditional feasibility models to incorporate broader macroeconomic conditions, societal acceptance, and governance structures.

Methodological Overview

The research team at Panca Budi Development University used a qualitative conceptual research design to synthesize existing frameworks across business and economics literature. Data collection involved a comprehensive review of peer-reviewed journal articles, academic texts, and policy reports from international economic institutions.

To process the literature, the authors applied a thematic-conceptual synthesis methodology. This analytical approach identified recurring thematic patterns across separate disciplines, evaluated the functional relationships between non-financial indicators, and structured an integrated feasibility model. The design allowed researchers to establish how economic, social, and political variables interact dynamically throughout the investment decision process.

Key Research Findings

The conceptual analysis by the Panca Budi Development University researchers outlines several critical insights into how non-financial dimensions govern long-term corporate viability:

  • Financial Feasibility as a Baseline Only: Financial profitability remains a necessary condition but is insufficient on its own to guarantee sustained operational success in dynamic markets.
  • Macroeconomic Indicators Form the Baseline: Broader macroeconomic conditions—such as inflation trends, interest rate movements, exchange rate fluctuations, and national purchasing power—determine overall market capacity and baseline financial viability.
  • Social Acceptance Ensures Operational Continuity: Earning social legitimacy through community alignment, environmental responsibility, and stakeholder engagement provides the necessary license to operate, preventing costly public opposition.
  • Political Certainty Safeguards Investments: Stable governance institutions, predictable legal enforcement, and consistent regulatory frameworks protect long-term capital investments from sudden policy disruptions.
  • Dynamic Interdependence of Dimensions: Economic potential, social legitimacy, and political stability reinforce one another; a weakness in any single dimension can jeopardize the overall feasibility of an enterprise.

Real-World Impact and Industry Implications

The integrated feasibility model developed by the authors offers actionable strategies for business leaders, financial institutions, and public policymakers. For corporate executive boards and investment managers, incorporating non-financial evaluation metrics minimizes capital risk and improves organizational resilience in uncertain foreign or domestic markets.

Financial institutions can refine credit risk models by evaluating borrowing firms on their social license and regulatory adaptability alongside standard cash-flow metrics. Additionally, public policymakers gain a clearer understanding of how regulatory consistency and transparent governance directly influence private sector investment decisions.

Dwi Pertiwi and the research team from Panca Budi Development University emphasize that combining economic opportunities, social legitimacy, and political certainty provides a balanced decision-making foundation that aligns commercial profitability with long-term societal value creation.

Author Profiles

  1. Dwi Pertiwi, S.E., M.Si. is a faculty member and researcher in the Accounting Study Program at Panca Budi Development University, Medan, specializing in financial accounting, behavioral accounting, and business feasibility studies.
  2. Najla Umayra, S.E., M.Si. is an academic in the Accounting Study Program at Panca Budi Development University, focusing on corporate governance and financial management.
  3. Hilda Tri Amanda, S.E., M.Si. is a researcher in the Accounting Study Program at Panca Budi Development University with expertise in business analysis and macroeconomic dynamics.
  4. Linda Sari Mutiara Ritonga, S.E., M.Si. is a lecturer and researcher in the Accounting Study Program at Panca Budi Development University specializing in sustainability accounting and corporate ethics.

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