Abstract
This study introduces and validates a measure of a company’s institutional profile for sustainability. It uses institutional theory as a lens to understand the factors that legitimize the adoption of renewable energy activities in an oil and gas company. The three institutional dimensions used in this study are regulative, normative and cognitive, which aimed to measure legitimacy in an oil and gas company under a sustainable change. Survey-based research was carried out among employees to test this theory. Moreover, structural equation modeling was used to test the model fit, validate the measures, and test the four hypotheses. The results showed that regulative and normative pillars play the main role in legitimating renewable energy practices in our case company. The findings provide researchers and companies with a valuable resource for exploring legitimacy in order to understand what makes companies legitimize new sustainable activities that are outside the companies’ core business.
Highlights
In today’s world, companies are pushed to adopt social and environmental responsibilities within their strategies and management systems [1,2]
Measuring sustainability is seen as a challenging task since it is difficult to implement and there is no specific goal to obtain when introducing sustainability within companies [13,14,51]
We found it interesting to measure legitimacy among employees in an oil and gas (OG) company, because they shape their legitimacy based on their experience within the company [51]
Summary
In today’s world, companies are pushed to adopt social and environmental responsibilities within their strategies and management systems [1,2]. Other companies have chosen to develop new sustainable activities and enter new markets. This approach has become a key item on the management agenda, and caused stakeholders to adjust their expectations of companies [3,4]. Established companies require more work on developing their legitimacy when introducing new technologies [5,6,7]. We know little about how established companies carry out sustainability in practice [9,10], how possible initiatives are engaged in [4,9], and how companies legitimate their new technologies during an institutional change [11]. The objective of this paper was to examine the emergence of legitimacy in an established company under a sustainable change
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