Climate inaction and managerial sensemaking: The case of renewable energy

Timo Busch,Marcel Richert,Matthew Johnson,Sven Lundie

doi:10.1002/csr.1972

Timo Busch, Marcel Richert + Show 2 more

Open Access

https://doi.org/10.1002/csr.1972

Copy DOI

Abstract

AbstractWhile business responses to climate change have been well researched on the organizational and institutional levels, the corporate strategic behavior on the microlevel—that ranges from proactivity to climate inaction—remain under‐researched. This article explores the individual determinants that affect the sensemaking phases, scanning, interpretation, and action, concerning the installation of on‐site renewable energy technologies. We investigate the extent to which managerial sensemaking is affected by different perceptions, motives, and skills in relation to renewable energy. By doing so, we uncover the individual determinants that affect decisions to either accept or reject the installation of renewable energy technologies. We contribute to the literature on business responses to climate change by deriving several key individual determinants on the microlevel, including technological expertise, sustainability orientation, time perspective, and economic growth attitude, which affect managers' sensemaking. Thus, we offer a framework to illustrate how these individual characteristics can lead either to proactive business responses or conversely to climate inaction.

Highlights

Despite major ecological disruptions emphasized in concepts such as the “Planetary Boundaries” (Rockström et al, 2009; Whiteman, Walker, & Perego, 2013), most companies have struggled to address grand environmental challenges effectively, such as climate change (Howard-Grenville, Buckle, Hoskins, & George, 2014; Levin, Cashore, Bernstein, & Auld, 2012; Slawinski, Pinkse, Busch, & Banerjee, 2017)
We argue that growth ambition influences the managers' interpretations, since such an ambition sways managers' investment decisions and prioritization among the economic, environmental, and social dimensions, which is expressed in the following proposition: Proposition 4 (P4): Managers' strong economic growth ambition increases the likelihood of climate inaction due to perceived tensions when interpreting economic and environmental goals
This article proposes that climate inaction occurs on the microlevel, where individual determinants that influence the sensemaking phases can explain inaction

Summary

Introduction

One notable explanation for such inaction in corporate sustainability deals with trade-offs between economic, social, and environmental goals, where managers perceive them as organizational tensions under paradoxical frames, often yielding a prudent stance that leads to reactive or limited responses on sustainability issues (Hahn, Preuss, Pinkse, & Figge, 2014; Kolk, 2012). Managers uncertain about issues concerning climate change in trade-off situations may choose not to act at all (Pinkse & Kolk, 2010). Previous studies find that companies realize win–win situations for environmental sustainability, especially when managers realize under a business case frame the ability to make profits from environmentally friendly behavior (Hahn, Figge, Pinkse, & Preuss, 2010; Salzmann, Ionescu-somers, & Steger, 2005).

Objectives

Methods

Results

Conclusion