The role of the environmental dimension in the performance management system: A systematic review and conceptual framework

Abstract

The issues of sustainable development and green practices have received increased attention in recent decades. More and more companies are moving towards a strategic approach designed to integrate environmental considerations into their strategies. Nevertheless, a difficulty still remains in the strategic alignment between the environmental dimension of sustainability and performance management system (PMS). In this context, a ‘state-of-the-art’ analysis of related literature was used to support future research to develop integration of effective approaches and solutions. To achieve this objective, the authors sought to develop a clear picture about the key drivers of the integration process between the environmental dimension and PMS, and to identify the missing concepts, research challenges and opportunities. The authors systematically reviewed 71 English-language scientific papers published between 2002 and 2020, and identified the missing concepts by means of content analysis. The authors found a growing trend in the 18-year period of increasing theoretical research on environmental issues, but a gap was found in developing practical solutions. The findings were used to develop a conceptual model for integrating environmental drivers that emerged from the analysis in an early stage of strategy formulation, through a scorecard-based tool aimed at supporting strategic alignment. This study provides a novel and original framework for exploring environment aspect and PMS approach. We also propose a future research agenda and useful recommendations for scholars and practitioners. It lays a firm foundation for future studies and research debates.