Business Case For Sustainability Research Articles

The business case for sustainability: six takes on a cultural artefact

ABSTRACT The business case as the prime mover of business decision-making retains an iron grip on the public imagination and the business school curriculum. Recent studies suggest its influence may be exaggerated, and that its depiction as totalising is somewhat cartoonish. We survey the role and effects of the business case in corporate sustainability efforts. Rather than examining its validity or correctness, we approach the business case as a commonly employed cultural artefact. We argue that the business case is neither sufficient nor necessary for sustainable innovation, and examine how it operates as a fixation and impediment, as well as occasional enabler. We conclude by laying out paths for sustainability champions to innovate with and beyond the business case.

Sustainable Business Practices: Integrating Environmental Impact Management into Modern Commerce Strategies

In the contemporary business landscape, the adoption of Sustainable Business Practices has evolved beyond a trend to become an imperative for organizations seeking to intertwine commerce with environmental stewardship. This article explores the multifaceted realm of sustainable business practices, emphasizing the integration of environmental impact management into modern commerce strategies. From supply chain optimization and energy efficiency to waste reduction and circular economy principles, businesses are urged to adopt a holistic approach. The article also underscores the ethical dimensions of consumer education, employee engagement, and transparent marketing in fostering a sustainable corporate culture. Beyond the ethical imperative, the business case for sustainability is compelling, with enhanced brand reputation, increased customer loyalty, and operational efficiency being tangible benefits. Despite initial challenges, the adoption of sustainable practices presents opportunities for innovation and long-term competitiveness. As businesses navigate a world where sustainability is synonymous with success, they redefine commerce strategies, illustrating that profitability and environmental responsibility are not mutually exclusive but interconnected pillars of a thriving and resilient business ecosystem.

Moving beyond “the” business case: How to make corporate sustainability work

AbstractOne of the most investigated research topics in the corporate sustainability literature is “the” business case. Long lionized for linking the profit motive to corporate environmental initiatives, the business case for sustainability is now vehemently criticized. These critics generally argue for a return to the state and stronger regulatory frameworks. Others counter that because the private sector's capabilities are uniquely suited to realizing effective sustainability innovations and outcomes, we must not abandon but further develop our business case understanding. In this view, firms' voluntary efforts are key for innovative solutions to sustainability problems. This article overviews and unites these seemingly disparate positions. We move the field forward by placing in context criticisms and also opportunities for more meaningful positive impacts from corporate sustainability. Specifically, we argue that an effective business case orientation requires shifting to a broader “all stakeholders win” approach. This entails impact orientation, collaborative approaches, and economic restraint.

What Types of Data Inform Strategic Factors Affecting Sustainability Decisions in Retail?

This paper begins by addressing the business case that a firm, in the retail context, must make to develop sustainability practices. The paper then discusses the strategic factors that shape sustainability decisions regarding the sustainability business case. These decisions are made by firms in the retail industry, with outcomes improving sustainability in processes that allow for innovation and advancements. It discusses internal and external factors, as well as background and driving information such as Stakeholder Theory and information on the retail industry itself. This paper details how data helps a firm transform their corporate strategies 
 The paper then explores the importance of the data types which inform the aforementioned strategic factors, as well as metrics contributing to the awareness of firms. This creates evidence for a firms’ sustainability business case, detailing how this data helps a firm transform their corporate strategy, contrived from the strategic factors, into action items, which the majority of managers report on struggling with. 
 This paper brings a new perspective by integrating strategic factors in sustainability, and data in retail on sustainability. This provides a clearer picture to firms on how to allocate their resources most effectively when deciding to, or attempting to, improve sustainability practices. Firms can use data to inform strategic decision making about and implementation of sustainable practices, including for resource allocation and supply chain analysis.

The business case for sustainability reporting in SMEs: consultants' and academics' perceptions

AbstractThe main aim of this paper is to provide insights into how the business case for sustainability reporting (SR) in SMEs is perceived by two groups of experts (consultants and academics). In particular, we examine how these two groups prioritize a set of costs and benefits associated with this type of reporting. The study draws on the best–worst method, a multicriteria decision‐making technique. Interviews were conducted with consultants and academics to gather detailed information about their perceptions regarding the costs and benefits that may be derived from the implementation of SR in SMEs. Consultants identified “competitive advantage” and “reputation and legitimacy” as the most relevant potential benefits of implementing SR in SMEs, while academics identified the “economic cost” as the most important criterion to be considered in the decision‐making process. Experts' perceptions of the business case for sustainability may encourage nonreporting SMEs to engage in sustainability. The identified gap between consultants and academics in the prioritization of costs and benefits is especially relevant to the emerging field of SR in SMEs. The study addresses an important topic from across the social and environmental accounting literature, the business case for SR in SMEs.

Exploring investment processes between traditional venture capital investors and sustainable start-ups

Venture capital is an important funding source for sustainable entrepreneurship and, thus, drives sustainable development. However, sustainable startups have trouble acquiring venture capital. Hence, existing literature focuses on dedicated impact investors or aims to understand why traditional venture capitalists (tVCs) avoid sustainable investment opportunities. In contrast, this study investigates investment decisions from venture capitalists without a dedicated “green” focus on sustainable startups. We investigate about 80 cases containing business plans and decision documents of sustainable and non-sustainable new ventures. Thereby, we explore whether investors react differently to sustainable business models. Using Natural Language Processing (NLP) and topic modeling, we find that tVCs do not integrate sustainability into their decision justification. However, Linguistic Inquiry and Word Count (LIWC) reveals that tVCs argue more emotionally when writing about a sustainable business case. However, this is not only the result of a stronger emotional connection to sustainability, as it might also be influenced by emotional contagion from entrepreneurs' business plans.

Closing the Gap Between Stakeholder Pressure and SME Owner-Managers’ Commitment to Sustainability: Does the Business Case Logic Matter?

Taking the lead from stakeholder management theory, this study seeks to shed light on the association between the stakeholder pressure and the involvement of small- and medium-sized enterprises (SMEs) in sustainable actions. The study also proposes a moderating role of the business case for corporate sustainability on this relationship. Questionnaire responses from 135 French SMEs were analysed, confirming the positive effect of various stakeholders on the commitment to sustainable business practices among SMEs. The empirical results show that this effect differs according to the three pillars of sustainable development. Empirical results also suggest that a business case for sustainability is the overwhelming driver for the adoption of more responsibility-oriented practices. These results are consistent with the instrumental approach of stakeholder theory, which reveals that incorporating stakeholders’ concerns into a firm’s sustainability strategy depends on the owner-manager’s perception of the economic-financial advantage of such practices.

Sustainable Palm Oil: What Drives it and Why Aren’t We There Yet?

Manuscript type: Research paper Research aims: This study explores the institutional pressure and motivation that drives Malaysian palm oil companies to embark on sustainability practices, and uncovers the impediments of substantive change in producing truly sustainable palm oil. Design/Methodology/Approach: A case study methodology was employed, gathering primary and secondary data through semistructured interviews with the company’s personnel and external stakeholders, through informal conversations and group discussions with company workers, document analyses, and observations. The neo-institutional and legitimacy theory were used as the primary lens to explain the study findings. Research findings: The results indicate that both external pressures and internal issues have forced the company to engage in sustainability practices – primarily through certification. Unlike the independent stakeholder pressure found in previous studies, a chain reaction of pressures was found from NGOs and competitors to multinational buyers, whom in turn put pressure on the case company, thus jeopardising their financial bottom lines. Regulatory pressures, conforming to the industry norms, wooing host country’s government, investors, and financiers add to the external motivation. Reputational problems and labour shortages, business case for sustainability, and the philanthropic nature of family-owned firms are the internal elements behind the endeavour. The barrier to change towards sustainability was mainly caused by cost concern, technical difficulties, mindset of workers, unsupportive business environment and impracticalities of safety equipment design. Originality/value: The findings shed light on the inner motive and barriers of change towards producing sustainable palm oil, the understanding of which is vital in driving further substantive changes in the palm oil industry towards sustainable development. Research limitation/Implication: The study was restricted to a single case company in the Malaysian palm oil industry and hence, generalisation of the study findings onto another context should be done in a cautious manner. Keywords: Organisational change, Neo-institutional theory, Legitimacy theory, Palm oil, Sustainability reporting and practice JEL Classification: Q56

Institutional pressure and real estate balanced scorecard indicators

PurposeThis paper aims to discuss the impact of institutional pressures on the selection of the performance indicators in 83 balanced scorecards (BSC) used in French real estate companies. The author studied the way in which two factors that are representative of institutional pressures in the real estate sector – namely, “ecology” and “digital innovation” – were incorporated into the BSC causal chains.Design/methodology/approachThe author’s methodology is that of action research. To analyze the balance of indicators between short and long term, the author classified the companies according to their strategic acuity, i.e. their ability to balance an organizational vision (near vision) and an environmental one (distance vision) when choosing their performance indicators. This resulted in a company classification with three categories: emmetropic, hypermetropic and slightly myopic.FindingsThis research enabled to observe that the selected ecological indicators in BSCs derive mainly from coercive institutional pressure. Hence, in companies with fewer legal requirements in ecological matters, the selected ecological indicators are included in the BSC causal chain, in that they are used as a commercial argument with a view to improving financial performance. These results are similar to the reactionary and reputational perspectives of the sustainability business case. With regard to the incorporation of digital innovation indicators into BSCs, the author found that the companies that have the most digital innovation indicators are those that mobilize the most ecological indicators. Digital innovation indicators are part of the companies’ internal process perspective and are linked to organizational learning indicators. These results are similar to the responsible and collaborative perspectives of the sustainability business case. The author also found that the companies incorporate digital indicators into their BSCs by institutional mimicry insofar as the selected indicators are not always consistent with a strategic rationale but are chosen by copying what is done in other companies.Research limitations/implicationsThe author’s research has two main limitations related to the methodology used. On the one hand, the mobilization of part-time management students to have access to companies can influence the emergence of mimetic isomorphisms. Indeed, these students follow the same training and advise the companies that welcome them according to the training they have followed. On the other hand, the author’s research stops at the development of the BSC. The author does not study the impacts or changes that occurred after the implementation of the tool. This could be the subject of future research on the appropriation and use of the BSC by the company’s actors and their impact on the optimization of global performance measurement system.Practical implicationsThis study may be of interest to researchers and managers who wish to reconcile sustainable development and digital innovation in global performance management. It analyzes the impact of institutional pressures on the performance measurement system. It offers insights on how to integrate ecological indicators and digital innovation indicators into the BSC causal chains. It identifies the tensions that managers may face. It reports on practices adopted in the field by managers in action.Social implicationsThis paper reveals the feasibility of measuring global performance integrating ecology and digital innovation. It responds to a preoccupation of recent years in academic research on how to reconcile corporate social responsibility and technological innovation. It shows that the companies that have the most digital innovation indicators are those that mobilize the most ecological indicators. However, it highlights the difficulties encountered by managers in the field when faced with institutional pressures.Originality/valueThe author’s reflection is in line with the literature of recent years that reconciles sustainable development and innovation. The author studied how “ecology” and “digital innovation” are incorporated into the BSC causal chains. To the best of the author’s knowledge, this is the first time this type of study has been conducted in the literature.

To shift a paradigm or not: worldviews at play in responsible management education literature

PurposeThis study analyzes which worldviews on the interrelatedness of the economic, environmental and social systems are adopted in the literature on responsible management education (RME) and explores how this affects the way business schools educate future responsible managers.Design/methodology/approachThe sustainability-focused relational worldviews of Kurucz et al. (2014) were used to perform a content analysis on 100 articles from the field of RME to understand which worldviews are adopted and to distill potential implications of the prevalence of such worldviews in the RME field.FindingsIn the sample, the most adopted view was the intertwined view that imagines a balance between the economic, environmental, and social system (61% of the articles). The subsuming worldview (highlighting the business case for sustainability) accounted for 8% of articles in the sample. The embedded worldview (a new paradigm that respects the limitations of the environmental and social systems) accounted for 31% of the articles in the sample. The disparate view (representing classic economic views of discrete systems) was not adopted, indicating a rather uniform belief that RME is about moving management education away from this view. Examining the evolution of views over the last 20 years, it can be observed that the embedded view is growing in popularity. The continuing prevalence of the ambiguous and malleable intertwined view in the RME literature could explain why so many RME initiatives have been taken in the last two decades, while simultaneously critics remain vocal that business schools are not preparing future managers to engage with ethics, responsibility, and sustainability (ERS).Originality/valueWhile sustainability-focused relational worldviews have been introduced in the RME literature, this study provides empirical evidence of the prevalence of such worldviews in the literature, allowing an exploration of the implications for the field. The presence of multiple — and at times competing — worldviews adds tension to the field of RME. Seen on the trajectory of increasingly progressive worldviews, the intertwined view is not limited by economic rationalism (like the subsuming view) but also stops short of requiring a full paradigm shift (like the embedded view).

Exploring Investment Processes between Venture Capital Investors and Sustainable Start-ups

Venture capital is an important funding source for sustainable entrepreneurship and, thus, drives sustainable development. However, sustainable startups have trouble acquiring venture capital. Hence, existing literature focuses on dedicated impact investors or aims to understand why more traditional investors avoid sustainable investment opportunities. In contrast, this study investigates investment processes from venture capitalists without a dedicated “green” focus on sustainable startups. We investigate 166 documents, containing business plans and decision documents of sustainable and non-sustainable new ventures. We explore whether sustainable entrepreneurs present their business plans in a different style than non-sustainable entrepreneurs and whether investors react differently to sustainable business models. Using NLP and topic modeling, we reveal that traditional venture capitalists do not justify an investment by writing about the topic sustainability. However, investigating writing styles based on sentiment and word usage shows that both, entrepreneurs and investors, argue more emotionally when writing about a sustainable business case.

The Paradoxical Profession: Project Management and the Contradictory Nature of Sustainable Project Objectives

Professions are undergoing a significant change in how they integrate environmental and social objectives into their core values. This article examines the situation in which those working in the project management profession are expected to work under contradictory sustainability constraints. In this article, we investigate the tensions project managers experience when addressing sustainable objectives. Results show that when tensions arise over sustainable objectives (temporality of objectives, organizational barriers, and lack of control), they are addressed only when anchored to an economic one in the form of a business case for sustainability. We also find that when matching traditional project objectives with sustainable ones is not possible, practitioners enact a set of reactions characterized as greenwashing, it can’t be one person, no space for sustainability in my job, other actors involved, or pushing back, depending on the specific project context. Adopting the paradox theory lens, we provide an alternative approach to the business case for sustainability. The practical contribution of this article lies in suggesting the need to find strategies to embrace paradoxical situations and we provide some suggestions to illustrate this.

Developing a comprehensive business case for sustainability: an inductive study

PurposeIn this paper, the authors argue that there is a flip side to the business-and-sustainability relationship, which deals with how sustainability affects management practices. The so-called first-class leading companies in sustainability have put sustainability at the centre of strategic planning and defined their business case for sustainability. This paper aims to analyse these companies on sustainability imperatives and propose a comprehensive framework for developing a business case for sustainability.Design/methodology/approachThis paper investigates the sustainability strategies and initiatives of six leading global firms (Nike, Unilever, Siemens AG, General Electric, Interface and Walmart). It provides insights into how leading firms have developed a comprehensive business case for their sustainability initiatives and are enjoying a competitive advantage. The inductive approach, using the case method and interpretive structural modelling, is used to propose a comprehensive framework for defining the business case for sustainability that might help other organisations do well by doing good and create sustainable value.FindingsThe success stories of the chosen organisations reaffirm that there is a business case for sustainability initiatives and efforts, as companies derive long-term benefits and also enjoy a competitive advantage. Other firms, which are yet to pave their paths towards sustainability, have a lot to learn from these successes.Practical implicationsThe conceptual framework proposed in this paper will be very useful for organisations that are still on the path to establishing a business case for sustainability as there is a lot to learn from the first-class companies practising sustainability and learn from their reflection and experience.Originality/valueThe study in this paper contributes to the existing knowledge base by presenting a comprehensive list of sustainability imperatives that helps an organisation define the business case for sustainability and proposes a conceptual framework in this direction.

Follow-up services for delirium after COVID-19-where now?

Delirium is a common presentation in older inpatients with coronavirus disease 2019 (COVID-19), and a risk factor for cognitive decline at discharge. The glaring gaps in the service provision in delirium care, regardless of aetiology, after a hospital admission pre-existed the pandemic, but the pandemic arguably offers an opportunity now to address them. Whilst a delirium episode in itself is not a long-term condition, the context of it may well be, and therefore patients might benefit from personalised care and support planning. There is no reason to believe that the delirium following COVID-19 is fundamentally different from any other delirium. We propose that the needs of older patients who have experienced delirium including from COVID-19 could be addressed through a new model of post-acute delirium care that combines early supported discharge, including discharge-to-assess, with community-based follow-up to assess for persistent delirium and early new long-term cognitive impairment. Such a drive could be structurally integrated with existing memory clinic services. To succeed, such an ambition has to be flexible, adaptable and person-centred. To understand the impact on resource and service utilisation, techniques of quality improvement should be implemented, and appropriate metrics reflecting both process and outcome will be essential to underpin robust and sustainable business cases to support implementation of delirium care as a long-term solution.

A Sustainable Business Case for Green Buildings

Increasingly, the emphasis has shifted towards the adoption of green buildings as stakeholders globally raise concerns on taking action on climate change. While there is a growing interest in the green building market, concerns regarding the social and economic impacts often arise. Research indicates there is insufficient data on a holistic approach to green buildings, which moves away from the primary focus of solely the environmental benefits and high economic costs associated with green buildings. This paper will, therefore, discuss the tangible and intangible aspects and benefits of a green building through the expanded scope of the triple bottom line of sustainability. This article aims to provide an overview focusing on the business case for opting for a green building as compared to a standard building. Results showcase green buildings to consume lower energy, reduce operational cost and offer a more productive indoor environment along with bringing higher economic returns when compared to a conventional building. The outcomes of this paper would aid in providing a better understanding of green building through the approach of a triple bottom line of sustainability and encourage the adoption of green buildings. This paper also concludes the future of green buildings to lie within the proper education of individuals, communities, organizations, and governments to analyze green buildings through the three dimensions of sustainability.

All for one or all for three: Empirical evidence of paradox theory in the triple-bottom-line

We empirically examine the triple-bottom-line of a sample of 746 firms from 2003 to 2013. The business case for sustainability advocates for corporate responsibilities only if they strengthen profits. In contrast, paradox theory states that managers should embrace the tensions between multiple bottom lines seeking simultaneous benefits. Combining data from KLD and Compustat, we find strong supporting evidence for paradox theory. First, the findings suggest that the three components of the triple bottom line move in tandem, rather than being mutually exclusive, where high (poor) performance in one dimension relates to high (poor) performance in the other two dimensions, regardless of the economic conditions. Second, using the Great Recession as an exogenous shock, we find supporting evidence for paradox theory. Lastly, we link paradox theory and its implication on market valuation; we find that the more components achieved at a high level, the higher the market valuation, with the valuation increasing per component achieved. We conclude that the traditional focus on scarcity and the mutual exclusivity of sustainability goals is not empirically supported in our study. Instead, we find compelling evidence for the abundance perspective of paradox theory and the simultaneous achievement of sustainability goals. Our results highlight that in viewing three bottom lines, managers should embrace any ostensible tensions to find creative ways to address all three instead of all for one.

Untangling the Origins of Sustainable Commitment: New Insights on the Small vs. Large Firms’ Debate

The sustainable development challenge is increasingly being included in entrepreneurs’ agendas. Firms are considered responsible for social and environmental effects but are also considered as social actors that can effectively incorporate sustainability solutions into market transactions. The literature on corporate social responsibility (CSR) in small business has depicted these firms as less involved in sustainability management implementation owing to resource constraints and limited perception of the business case for sustainability. Further, studies on both small business and sustainable entrepreneurship have highlighted the pivotal role of entrepreneurs’ values in motivating a more sustainable way of conducting business while, large companies, driven by external pressures, are more focused on a strategic CSR approach than small firms. Starting from these premises, the paper aims to identify the main drivers or barriers of sustainability implementation and to verify any significant differences between small and large-sized companies in their approach to sustainability practices implementation. The study adopts a qualitative research method based on semi-structured interviews addressing 22 participants from Italian firms of different sizes selected for their social and environmental commitment. The findings of the study highlight the existence of some common features among small and large firms, in particular, regarding motivations, entrepreneur values, and business vision, contributing new perspectives to the sustainable entrepreneurship debate.

Sustainable business model archetypes for the electric vehicle battery second use industry: Towards a conceptual framework

This paper explores sustainable business models (SBMs) evolution for the rapidly developing battery second use (B2U) market within the emerging electric vehicle (EV) industry. Previous work identified that SBMs and EV B2U are emerging as major research streams but there is paucity among literature to deliver an overarching framework or a holistic view between these fields and highlight fresh areas for future research. We adopted an inductive multiple-case study approach to unearth new knowledge by comprehending how B2U stakeholders undertake their sustainability-related business activities. These are not only focused on economic profitability but more importantly address wider social and environmental stakeholder value as part of prospective SBMs. The SBM archetypes were adopted as the major lens for our data analysis to study multiple cases of B2U stakeholder roles and comprehend further the scope and ultimate purpose of their operations. Major results indicate that the SBM archetypes as major sustainable innovation strategies have the potential to create a new conception of business models for sustainability in the EV B2U market. In turn, this creates and drives shared sustainable value for multiple stakeholders through cross-sectoral collaborations as part of ntire new and more SBMs. Finally, this study proposes the conceptual sustainable innovation business model (SIBM) framework for the EV B2U industry that includes such shared sustainable value creations which in turn drives forward business performance and sustainability at the same time, eventually creating the business case for sustainability within the EV industry.

Sustainable entrepreneurship, innovation, and business models: Integrative framework and propositions for future research

AbstractThis article introduces the business models for sustainability innovation (BMfSI) framework to study how business models mediate between sustainability innovations and business cases for sustainability. The BMfSI framework integrates two major perspectives (implicitly) found in the sustainable business model literature. The first is the agency perspective. It takes into consideration that some form of agency is needed, that is, “someone” who takes decisions and acts. Sustainable entrepreneurs are discussed as those agents who align their new or existing business models with sustainability innovations in order to be successful in business and to create value with and for stakeholders. The second perspective is the systems perspective, which acknowledges that business models are always embedded within sociotechnical contexts through which, for example, public policies, private financing, or stakeholder interests influence whether and how business models can be developed. The agency and systems perspectives are integrated in the so‐called business model mediation space. This theoretical notion embraces the decisions and activities pursued by sustainable entrepreneurs as they align their business models with sustainability innovations on the one hand and the influence of environmental contingencies, barriers, and stakeholders from the sociotechnical context on the other hand. The paper concludes with propositions for future research derived from the BMfSI framework.

Embedding environment and sustainability into corporate financial decision‐making

AbstractThe business case for sustainability can be built upon: (i) cost reduction from efficient resource utilisation, (ii) revenue enhancement, (iii) risk management, and (iv) intangible assets. However, executives often adopt a short‐term perspective owing to executive compensation, investor pressure, and decision‐making criteria tied to fixed financial reporting systems. We propose an integrated conceptual framework, which highlights how firms could embed environment and sustainability into their long‐term financial decision‐making framework. To give this goal structure, the firm could adopt: (i) longer‐term executive compensation plans, (ii) longer‐term financial reporting, and (iii) flexible financial decision‐making models which embed intangibles.