Greening Austrian social service and healthcare non-profits

Abstract

The climate crisis requires the systematic integration of environmental matters into the management practices of companies across all sectors. The 2022 Corporate Sustainability Reporting Directive (CSRD) has created a need in many large social service and healthcare non-profits (SSHC–NPOs) within the European Union to extend the integration of environmental matters by 2025. While there is plenty of research on environment management practices of large for-profit enterprises, the research on environmental matters in SSHC-NPOs, which gain their legitimacy from social value creation, has been neglected. This study examines how large Austrian SSHC-NPOs are preparing for the environmental requirements set by the CSRD. The integration of environmental considerations into their core strategy, sustainable management control practices, and non-financial reporting poses a significant challenge. To evaluate the status of integration of environmental matters, the paper uses two sequential stage models based on institutional theory. The study is based on data from interviews with 21 Austrian SSHC-NPOs. The findings reveal that the integration of environmental matters is at an early stage, driven by a pragmatic approach with a strong emphasis on social and financial concerns. Cultural controls take precedence in management control practices, while administrative and cybernetic controls lag behind. Environmental reporting does not meet CSRD requirements, and the studied SSHC-NPOs aim for minimal compliance only, when CSRD comes into force in 2025. Additionally, it highlights that these organizations do not conform to the sequential stages proposed by two institutionalist stage models, emphasizing the role of the SSHC sector's context in shaping their behavior and practices.