The Change Leadership Sustainability Demands

Change ain't ever easy, and sure as hell ain't easy for organizations.  Thus, Luneburger and Goleman discuss just how an organization undergoes the transformation between a solely economic focused business unto a sustainable, forward thinking leader. 

"Sustainability initiatives can’t be driven through an organization the way other changes can. They have three distinct stages, and each requires different organizational capabilities and leadership competencies."  True dat, right?

Companies don't deny that transitioning into amore sustainable companies isn't a good idea.  Rather, they just stumble into a bad plan to make that transition; they assume making one change over a long period of time will suffice.  Alas, it actual requires "three distinct cases, each needing different leadership skills on the part of the executive heading the effort."

Phase One: Sustainability leader within the organization has the great idea to change and must determine a way to translate this idea into a business plan.

Phase Two: That great idea and plan manifests itself into something concrete;  It must have clearly laid out initiatives and "hard commercial targets." Sustainability and idealism infect the entire company, not just the one leader.
"At the end of this phase, sustainability becomes an organization-wide imperative that is tracked through economic, environmental and social metrics over the business planning cycle."

Phase Three:Sustainability becomes a core value of the company, in its DNA, and its leader must anticipate future needs, set long-term goals, etc.  (i.e. what we were sayin' anyway)

Lueneburger, C. & Goleman, D. (2010). The Change Leadership Sus tainability Demands., MIT SloanManagement Review, Summer, 49-55.

Towards Sustainability: Examining the Drivers and Change Process within SMEs

Dunphy's Sustainability Phase Model

This article is a treasure trove. 

"This paper provides a thorough literature review of the current stage of the development of such frameworks, as well as a comparison with assessments of where 21st century corporations stand with regards to sustainability."

• In the 2010 Sustainability and Innovation Global Executive Study (SIGES) (MIT, 2011) of 3,000 executives, 57% reported that pursuing sustainability-related strategies is necessary to be competitive. This study labeled 24% of the respondents as “embracers” when in addition to seeing sustainability as necessary to be competitive they also reported their organization as having a business case for sustainability and reported it as a permanent part of management’s agenda. These embracers see themselves as outperforming their competitors (70%) and report their organizations’ sustainability related actions have increased their profits (66%).

• Because change is difficult, especially on an organizational level, Lueneburger & Goleman (2010) indicate that their research shows that sustainability initiatives evolve through three distinct phases: in the first phase the systemic challenge is to create the sustainability vision; the second phase is to translate that vision into action; and in the third phase the organization anticipates future needs. 
• Demartini et al. (2011) present an extensive literature search on sustainable management of SMEs, from which they conclude that at present there exists no convincing evidence that sustainability strategies now being used by large companies are viable for SMEs, and that therefore a great deal of research needs to be done, because of the large numbers of SMEs.

• Howard-Grenville (2006), however, provides compelling evidence that internal factors are also important drivers of corporate action with respect to environmental sustainability, and that even organization sub-cultures can have distinct impacts on what the corporation overall decides to do or not do. The author states that “[a]ttending explicitly to what an organization’s culture and subcultures are, not what they ought to be, and how these cultures shape interpretations and action, should yield insight into a more complex picture of the motivators and practices of corporate environmental management.”(p.47). This argues strongly for the use of qualitative research methodology, at least in the beginning, in order to avoid being “fed” the official line rather than the actuality of what the driving cultural attitudes towards sustainability are in the organization, and who/which groups within the SME, if any, actually have the power to take the organization to the next “wave.”  

A large portion of the article is a discussion of the following:

As noted in the previous section, research on organizational change has typically been focused on large-scale organizational change. One such model is Kotter’s Eight Stage Process of Creating Major Change (Kotter, 1995). This model states that there are eight stages that an organization must move through, and that each stage must be adequately addressed if the desired change is to occur and become part of a new operating environment. These steps include: 

1) Establishing a sense of urgency    

2) Creating the guiding coalition   

3) Developing a vision and strategy  

4) Communicating the change vision  

5) Empowering broad-based action  

6) Generating short-term wins 

7) Consolidating change and producing more change   

8) Anchoring new approaches in the culture   

  

The general observations that most change efforts do not succeed is echoed in the field of sustainability, with most experts in agreement that progress towards sustainability has been modest at best (Doppelt, 2003). In examining what goes wrong with organizational efforts to move towards sustainability, Doppelt (2003) has identified what he terms “seven sustainability blunders”. These include: 

1) Patriarchal thinking that leads to a false sense of security 

2) A “siloed” approach to environmental and socioeconomic issues 

3) No clear vision of sustainability 

4) Confusion over cause and effect 

5) Lack of information 

6) Insufficient mechanisms for learning 

7) Failure to institutionalize sustainability 

Sloan, K. Klingenburg, B. Rider, C. (2013). Towards Sustainability: Examining the Drivers and Change Process within the SMES, Journal of Management and Sustainability, 3(2), 19-30.

Business Ethics: Where are we Going?

This articles asks the questions as to whether or not businesses public images are worsened by stricter policies and regulations or by shallower practices themselves. It proposes a solution by teaching current and future business students the importance of corporate social responsibility and business ethics.

• "Business permeates our entire living experience and the public expects responsible behavior from business, as it would a family member. As a society, we have put our trust in companies that "bring good things to life" and give us "better living through chemistry."
• Ethics vs. Legality.  Just because it is legal, doesn't mean that it is ethical. Ethical behavior should transcend legality. 
• For the business community to formulate a specific code that would apply to all conceivable situations and activities would be as doomed to failure as government attempts to do the same thing. 
• Instead of these "thou shalt nots," consider ethical guidelines proposed by Robert W. Austin in 1961 (converted into questions by article author)
• Can I affirm that I am subordinating my person interests to the interests of the company?
• Am I placing my duty to society above my duty to the company and above my personal interests?
• Have I revealed the facts of the situation where my private interests conflict with those of my company, or the company's with those of society?
• "Idealism" is not for holy days but for every day--"ethical behavior is good business." Results in "greater drive and motivation, it attracts better quality people who appreciate working with a respected company; and it improves relations with customers, competitors and the public."
• After reviewing various colleges and universities business programs, the author discovered that hardly any truly focused on ethics beyond lip service.  The curriculum "in most cases is an emphasis on practicality, a concentration on what is, not what should be."
• Need for a paradigm shift in economics education: ethics should not be contingent upon one's character, but rather practice and contemplation in ethics through better education. 
• The author proposes seminars on such, emphasis on better decision making, business world leaders giving information on business ethics applications--not just faculty, 
• Making a stance against unethical behavior is not enough--many businesses do not abide by their own policies.  
• Businesses may want to consider having someone in particular who is in charge of public policy, environmental responsibility, and other corporate responsibilities. 
• "The decision for the future rests within the business community. There appears to be a clear prescription of what is required, and some guidelines that can help in bringing about the required changes in corporate behavior.  The crucial question is whether the business community is willing to make the short-term concessions necessary to achieve its long term goal: survival." 

Wabam. 

Saul, George. (1981). Business Ethics: Where are We Going? The Academy of Management Review, 6(2), 269-276. 

Sustainability-Driven Implementation of Corporate Social Responsibility: Application of the Integrative Sustainability Triangle

The opening line of the article, "Today, there is a broad consensus that the maximization of profit--as still advocated in microeconomic theory--can no longer be the exclusive goal of companies within the context of the overall economy."  One of these alternative goals that has risen over the past to decades, of course, is corporate sustainability. 

The article uses the term "Corporate Social Responsibility" (CSR)--a corporate contribution to sustainable development."

The early development of CSR and its link to sustainable development

• "The business of business is business" evolves into corporations being quasi-public institutions, and that stakeholders and corporations can both receive benefits from their contributions (referred to as "coalition"). 
• "Strategic Management" - Corporate Planning, Systems Theory, Organization Theory. Contrasted the shareholder value paradigm and focused on the corporation and short-term profits.
• "Human Relation Approach" - focused on 'soft factors' and strengthening relationships with stakeholders.  Corporations focused not solely on corporate goals but societal objectives. Business ethics rise. 
• This stemmed 'CSR Europe' in 1996 that fostered standards of legal requirements against social exclusion.  The author states that this is problematic because it applies general solutions to specific and complicated problems.
• United Nations introduce "Sustainable Development" in 1987 (development that meets the needs of the present without compromising the needs of the future), but there have been many who haven't fully understood the concept in its application.
• Eco-efficiency--integrating ecology and economy through efficient use of natural resources, introduced by UNCED to make business approaches better.

Corporate Sustainability- meeting the needs of the direct and indirect stakeholders (such as shareholders, employees, clients, pressure groups, communities, etc) without compromising the ability to meet the needs of future stakeholders as well. 

Implementation and horizontal integration

• The idea of corporate sustainability remains vague and is thus the source of many failed attempts to incorporate the term into daily business practices.  There is no real general approach, but there shouldn't be--sustainability is a complex concept that cannot be generally applied amongst vastly different industries. 
• Indicators such as kg of waste, sales volume, pounds of water, etc. used to measure "sustainability"
• eco-efficiency operator (implemented by Schaltegger and Sturm)- ratio of economic to ecological life-cycle burden. Leads to a win-win situation through efficient use of resources and corresponding benefits. 

The article proposes that there is a need for integrative concepts to provide simple and supportive yet comprehensive and conclusive augmentation of sustainability in corporations.  The answer?  The integrative sustainability triangle:

• Ecology, Economy and Society are the three main components.  (Hauntingly similar to the triple bottom line). 
• Solutions to today's issues must be inter-disciplinary. 
• connecting each component are indicators of "strong", "partial" and "weak" association to signify its relationships and triggers.
• the center, of course, is the "quadruple" in which all components are major influencers. 

What does this mean?

• Win-Win situations should be sought out and stakeholders should be the basis for the identification of issues. 
• Selection of focal topics--business size, regional activities--break down general approach in to more applicable factors.
• Anchoring and implementation must have support in highest forms of management.
• Efficient reporting and communication is the final indicator of a company's engagement with stakeholders and social responsibility. 

There's more here, but I didn't want to keep going into this one theory of resolving sustainability issues since we need like 30 more sources.  Note this as having more to go on though. 

Kleine, A. Hauff, Michael. (2009). Sustainability-Driven Implementation of Corporate Social Responsibility: Application of the Integrative Sustainability Triangle. Journal of Business Ethics, 3(85), 517-533. 

Sustainability: Virtuous or Vulgar?

Just as businesses have various motivations and interpretations of how to apply sustainability to their corporations, sustainability itself seems to have no clear definition.   Some view it as more economical, some view it as preserving biodiversity and habitat, others view it as more efficiently meeting human needs. This article proposing a five-fold definition:

1. "Development of efficient technologies and markets for meeting human needs, which is generally the purview of engineering, physical science, biotechnology, economics, and business."
2. "Understanding the state and nature of ecosystems, which is generally the purview of ecology and environmental science."
3. "Understanding how exploitation affects ecosystems, which is generally the purview of applied ecology and environmental science."
4. "Understanding how exploitation affects human cultures, which is generally the purview of sociology, political science, policy, law, anthropology, and the arts and humanities."
5. "Understanding the meaning of normative concepts such as human needs, socially just, depriving, and ecosystem health, which is generally the purview of ethics and philosophy."

Keeping this in mind, sustainability is multi-discipline, multi-dimensional and requires the cooperation beyond just an ecologist and an economist; rather, we must incorporate ethics and legitimation into science and economics.  As complex as the environment, so are the methods used to maintain it.

The article then divides sustainability into two forms:

Weak Sustainability- concerned with preserving human welfare and commiserated with economic principles.
Strong Sustainability- concerned with sustaining natural capital, aligned with conservation.

Sustainability now is about balancing its three primary virtues: concern for human need, ecosystem health, and social justice. "What counts as sustainable or good, even for the most specific managing scenario (e.g., harvesting or water use), requires knowing whether proposed management satisfy the guiding virtues of sustainability."

"If we attain sustainability, it will not only require critical changes in technology, but also the most profound shift in ethical thought witnessed in the last four centuries." (What a statement, right?)

And, as a side note, the reason this paper is entitled "Virtuous or Vulgar?" is because it debates whether sustainability is rooted in anthropocentric or non-anthropocentric values and whether or not we should choose one or the other.  I found this debate interesting, but not particularly relatable to our research purposes.

Nelson, M.  Vucetich, J. (2010). Sustainability: Vulgar or Virtuous? Bioscience, 60(7), 539-534.

Sustainabilty: How Stakeholder Perceptions Differ From Corporate Reality

" A strong reputation is widely acknowledged to be the most valuable asset of a firm, and sustainability has become an important component of corporate reputation."  Many businesses report that sustainability is an important factor in their decision making processes.  Yet there is a gap between stakeholder perceptions and company performance.  Companies that more fully integrate sustainability into daily business practices are better able to convince consumers of their green practices.

Benefits of Sustainability in Business

• Reduction of energy use can create cost savings.
• Waste revenue can create new revenue streams when firms sell instead of discard by-products.
• Sustainability initiatives can stimulate a culture of innovation within the firm.
• Motivated and driven graduates seeking employment may prefer working for companies who are well received environmentally.
• Customers are more willing to pay higher prices or remain loyal to more sustainable focused companies.
• Investors and lenders often perceive such companies as better investments and lower risk companies.

Key Facts Regarding Businesses and Sustainability

• Sustainability initiatives are included in as many as 20% of mainstream advertising messages.
• 91% of all U.S.-based businesses have formal reporting policies related to their sustainability efforts.
• 88% of respondents stated that good corporate citizenship was important.This was equally reflected among stakeholders. 
• 
  

 Study Factors

• Methods included a perceptual survey and a third-party rating.
• Total sample size of individuals was 2,400 individuals, 800 for each stakeholder category represented.
• Future employees considered were defined as students graduating from a college or university in the next eight months.
• Stakeholders from six different countries were selected: China, Germany, India, Japan, the United Kingdom, and the United States (400 from each, divided equally into 3 stakeholder categories).
• Smartview 360 platform of CRD Analytics used as the measure for actual sustainability performance.  Methodology based on GRI, including NASDAQ OMX CRD Global Sustainability Index.
• Results from research was interpreted into a Sustainability Perception Score (SPS) and a Sustainability Reality Score (SRC) for all firms, creating a Sustainability IQ Matix. 

 Why does Perception Not Meet Reality?

• Individuals lack motivation to interpret sustainability messages; "In effect, although individuals wish to appear moral, their underlying attitudes and subsequent behaviors do not correspond to their publicly stated intentions."
• Because sustainability and environmental issues are seemingly unsolvable, individuals actively avoid information related to sustainability.
• Additionally, the jargon of sustainability terms is often misunderstood and not clearly laid out.  Consider the various implications of the term "Organic." Stakeholders without a specialized understanding of these differences are unable to interpret them. 
• When firms put sustainability efforts into a language stakeholders can understand, stakeholders may not understand the extent to which such actions are truly sustainable.  Yet firms can have weak sustainable initiatives overall but because consumers understand them, they are placed under the 'halo effect' while more sophisticated, long-term sustainably minded firms are overlooked. 
• Category Biases- Businesses in industries that are heavily frowned upon, such as oil companies or financial industries, are overlooked sustainably speaking because of their reputation.
• Brand Biases- Walt Disney has one of the highest ratings, and Wal-mart one of the lowest for company images.  Yet Wal-mart is emerging as a sustainability leader in the corporate world. 

Cerruti, J. Loock, M. Muyot, M. Peloza, J. (2012). Sustainability: How Stakeholder Perceptions Differ From Corporate Reality. California Management Review, 55 (1), 74-97.

For Research Methods: Practical Strategies for combining qualitative and quantitative methods

General Points

• two reasons why its hard to combine qual and quant methods: its a technical problem, and there is a conflict between paradigms in their combination
• He says combining the two is essentially like fact checking, you look to see if you get the same conclusions twice
• This demonstrates that your results are not simply due to the invalidity of a particular method: mixed methods actually strengthens your argument for each

Research Designs on Complementary Assistance:

• there is a "division of labor" in using the complementary strengths of qual and quant methods
• There are two decisions to be made: which method is the priority (for us qual) and which comes first in the design (for us quant)
• The complementary method assists the principal method
• he says "qualitative projects can be supplemented by the strengths that quantitative methods offer"
• Initial small-scale quant methods guides decision that the researcher makes to the bigger qualitative research
• Our preliminary questionnaire provides context for understanding our sample and "help to focus the analysis of large amounts of qualitative data
• This process is frequently used by anthropologists

Morgan, D. (1998). Practical strategies for combining qualitative and quantitative methods: Applications to health research. Qualitative Health Research, 8(3), 362-376.

(Morgan, 1998)

(