When they are more than just employees: Environmentally conscious decision‐making in employee‐owned organizations

Abstract

AbstractPromoting environmental sustainability may hold relevance for employee‐owned organizations since their employees prioritize the long‐term well‐being of the business as they influence and are influenced by the legacy of the organization. The integration of environmental consciousness into decision‐making has thus the potential to help align environmental and organizational sustainability objectives in these organizations. However, the literature lacks an explanation of how employee‐owned organizations make environmentally conscious decisions. In this study, we conducted interviews with top executives of employee‐owned organizations to explore how environmentally conscious decision‐making unfolds in the experiences of these managers. We find that transparency and delegation of authority serve as two key mechanisms that underlie environmentally conscious decision‐making in employee‐owned organizations. We also find three paths inspired by these mechanisms that employee‐owned organizations follow in making environmentally conscious decisions. We discuss the implications of these mechanisms and paths for research and practice.