Abstract
Growing importance of sustainable development, corporate social responsibility and business ethics requires various types of contemporary organisations innovation. This research assesses the problem related to business policy innovation (BPI), which represents organisational governance determination. The main purpose of the paper is to qualitatively and quantitatively present a new, requisitely holistic strategic model of the soft factors influencing BPI, which interdependently incorporates changes in organisational values, culture and business ethics, as well as stakeholders’ interests reconciliation, thus determine soft possibilities for more sustainable business policy, management and practice. While the relevance of these factors for business policy is in the literature widely recognized, there is a small amount of empirical research on their influence on BPI. To mitigate this research gap, advanced structural equation modelling (SEM) based partial least squares (PLS) method was used for analysing data of 734 organisations in Slovenia, the EU state. The research results show that researched soft factors organisational values, culture and stakeholders’ interests reconciliation statistically confirmed influence BPI. Thus, these recognitions can be used as the basis for strategic managerial decision making towards social responsibility and sustainability of an organisation. Reasons why it has not been statistically confirmed that business ethics influence BPI needs to be investigated in future research.
Highlights
As the subject of stringent requirements for contemporary organisations [1], corporate social responsibility and sustainability are getting the major consideration of organisations’ strategies [2] and there are many appeals to policy makers to increase efficiency and innovate their practice in this direction [3]
The size classes of the organisations included into the survey sample were determined based on the quantitative criteria (2 of 3 of them have to be fulfilled for organisation size to be selected): headcount, annual turnover and total balance sheet, as determined in the Slovenian Companies Act [92]
In all size classes of researched organisations there were more male (69.20%) than female (30.80%) respondents. This goes in line with official Slovenia state data (Statistical Office of Republic of Slovenia [93]), because out of 44,256 organisation managers researched at the end of the year 2010, 68.4% of managers were men and only 31.6% of managers were women. 72.75% of the research instrument respondents were organisation’s owners or governors (47.14% sole owners or governors and 25.61% co-owners or co-governors), and 27.25% of them were organisation’s top managers
Summary
As the subject of stringent requirements for contemporary organisations [1], corporate social responsibility and sustainability are getting the major consideration of organisations’ strategies [2] and there are many appeals to policy makers to increase efficiency and innovate their practice in this direction [3]. Due to the great significance of incorporation of social responsibility, business ethics, and sustainability principles in organisational practices, innovation of its business policy and management is needed. Top managers, who importantly influence organisational directions [4], should be developing and implementing strategies oriented towards greater social responsibility (SR) [5] and (humans’) requisite holism [6], for more business ethics and sustainability of the organisation. Organisational governance, governed by organisational owners who determine business policy/governance orientation, is crucial for achieving social responsibility and business ethics. Responsible determined business policy is realised through its fair, responsible (top, middle, first line) management and practice [7]
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