In Search of the Dominant Rationale in Sustainability Management: Legitimacy- or Profit-Seeking?

Journal of Business Ethics

Volumn 145, Issue 2, 2017, Pages 259-276

  Schaltegger, Stefan ^a   Hörisch, Jacob ^a,b  

^a LEUPHANA UNIVERSITY OF LÜNEBURG   (Germany)

^b Alanus University   (Germany)

Author keywords

Corporate sustainability; Legitimacy; Profit seeking; Sustainability management; Sustainability management practices

Indexed keywords

EID: 84944525620     PISSN: 01674544     EISSN: 15730697     Source Type: Journal    
DOI: 10.1007/s10551-015-2854-3     Document Type: Article

References (121)

1. Alexander, J. (2007). Environmental sustainability versus profit maximization: Overcoming systemic constraints on implementing normatively preferable alternatives. Journal of Business Ethics, 76(2), 155–162.
2. Ameer, R., & Othman, R. (2012). Sustainability practices and corporate financial performance: A study based on the top global corporations. Journal of Business Ethics, 108(1), 61–79.
3. Arshed, N., Carter, S., & Mason, C. (2014). The ineffectiveness of entrepreneurship policy: is policy formulation to blame? Small Business Economics, 43(3), 639–659.
4. Balmer, J., Powell, S., & Greyser, S. (2011). Explicating ethical corporate marketing. Insights from the BP Deepwater Horizon catastrophe. The ethical brand that exploded and then imploded. Journal of Business Ethics, 102(1), 1–14.
5. Bansal, P., & Bogner, W. (2002). Deciding on ISO 14001: Economics, institutions, and context. Long Range Planning, 35(3), 269–290.
6. Bansal, P., & Roth, K. (2000). Why companies go green: A model of ecological responsiveness. Academy of Management Review, 43(4), 717–736.
7. Barley, S. R., & Tolbert, P. S. (1997). Institutionalization and Structuration: Studying the links between action and institution. Organization Studies, 18(1), 93–117.
8. Bartlett, J. E., Kotrlik, J. W., & Higgins, C. C. (2001). Organizational research: determining appropriate sample size in survey research. Information Technology, Learning and Performance Journal, 19(1), 43–50.
9. Baruch, Y., & Holtom, B. C. (2008). Survey response rate levels and trends in organizational research. Human Relations, 61(8), 1139–1160.
10. Black, L. D., & Härtel, C. E. J. (2004). The five capabilities of socially responsible companies. Journal of Public Affairs, 4(2), 125–144.
11. Blume, L. E., & Easley, D. (2008). Rationality. In S. N. Durlauf & L. E. Blume (Eds.), The new Palgrave dictionary of economics. Basingstoke: Palgrave Macmillan.
12. BMU (German Federal Ministry for the Environment). (2002). Sustainability management in business enterprises. Concepts and instruments for sustainable organisation development. Bonn: Federal Ministry for the Environment, Nature Conservation and Nuclear Safety; Federation of German Industries; Centre for Sustainability Management.
13. Boatright, J. R. (1996). Business ethics and the theory of the firm. American Business Law Journal, 34(2), 217–238.
14. Bowen, F. E. (2002). Does size matter? Organizational slack and visibility as alternative explanations for environmental responsiveness. Business and Society, 41(1), 118–124.
15. Brammer, S., & Pavelin, S. (2006). Corporate reputation and social performance: The importance of fit. Journal of Management Studies, 43(3), 435–455.
16. Branco, M. C., Eugénio, T., & Ribeiro, J. (2008). Environmental disclosure in response to public perception of environmental threats: The case of co-incineration in Portugal. Journal of Communication Management, 12(2), 136–151.
17. Bréchet, T., Camacho, C., & Veliov, V. M. (2014). Model predictive control, the economy, and the issue of global warming. Annals of Operations Research, 220(1), 25–48.
18. Brignall, S. (2002). The unbalanced scorecard: a social and environmental critique. Proceedings of the PMA 2002: Research and action, Boston, MA, pp. 85–92.
19. Bronn, P. S., & Vidaver-Cohen, D. (2009). Corporate motives for social initiative. Legitimacy, sustainability, or the bottom line? Journal of Business Ethics, 87(1), 91–109.
20. Bruton, G. D., Ahlstrom, D., & Han-Lin, L. (2010). Institutional theory and entrepreneurship: Where are we now and where do we need to move in the future? Entrepreneurship Theory and Practice, 34(3), 421–440.
21. Burritt, R., Hahn, T., & Schaltegger, S. (2002). Towards a comprehensive framework for environmental management accounting. Links between business actors and environmental management Accounting tools. Australian Accounting Review, 12(2), 39–50.
22. Busch, T., & Hoffmann, V. H. (2011). How hot is your bottom line? Linking carbon and financial performance. Business and Society, 50(2), 233–265.
23. Campbell, D. (2003). Intra- and intersectoral effects in environmental disclosures: Evidence for legitimacy theory? Business Strategy and the Environment, 12(6), 357–371.
24. Carroll, A. B., & Shabana, K. M. (2010). The business case for corporate social responsibility: A review of concepts, research and practice. International Journal of Management Reviews, 12(1), 85–105.
25. Castelló, I., & Lozano, J. M. (2011). Searching for new forms of legitimacy through corporate responsibility rhetoric. Journal of Business Ethics, 100(1), 11–29.
26. Cho, C. H. (2009). Legitimation strategies used in response to environmental disaster: A French case study of Total SA’s Erika and AZF incidents. European Accounting Review, 18(1), 33–62.
27. Cho, C. H., & Patten, D. M. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32(7–8), 639–647.
28. Clark, C. E. (2000). Differences between public relations and corporate social responsibility: An analysis. Corporate Reputation Review, 26(3), 363–380.
29. Collison, D., Clark, R., Barbour, J., Buck, A., Fraser, R., Lyon, B., et al. (2003). Environmental performance measurement through accounting systems: A survey of UK practice. In M. Bennett, P. M. Rikhardsson, & S. Schaltegger (Eds.), Environmental management accounting. Purpose and progress (pp. 189–232). Dordrecht: Kluwer.
30. Commons, J. R. (1934): Institutional economics: Its place in political economy. New York.
31. Commons, J. R. (1936). Institutional economics. American Economic Review, 26, 237–249.
32. Consolandi, C., Innocenti, A., & Vercelli, A. (2009). CSR, rationality and the ethical preferences of investors in a laboratory experiment. Research in Economics, 63(4), 242–252.
33. Cordeiro, J. J., & Tewari, M. (2015). Firm characteristics, industry context, and investor reactions to environmental CSR: A stakeholder theory approach. Journal of Business Ethics, 130, 833–849.
34. Darnall, N., Henriques, I., & Sadorsky, P. (2010). Adopting proactive environmental strategy: The influence of stakeholders and firm size. Journal of Management Studies, 47(6), 1072–1094.
35. Deegan, C. (2002). Introduction: The legitimising effect of social and environmental disclosures: A theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282–311.
36. Delmas, M., & Keller, A. (2005). Free riding in voluntary environmental programs: The case of the U.S. EPA WasteWise program. Policy Science, 38(2–3), 91–106.
37. DiMaggio, P. J., & Powell, W. W. (1983). The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48(2), 147–160.
38. Ditlev-Simonsen, C. D., & Midttun, A. (2011). What motivates managers to pursue corporate responsibility? A survey among key stakeholders. Corporate Social Responsibility Environmental Management, 18(1), 25–38.
39. Dowling, J., & Pfeffer, J. (1975). Organizational legitimacy: Social values and organizational behavior. The Pacific Sociological Review, 18(1), 122–136.
40. Du, X. (2014). How the market values greenwashing? Evidence from China. Journal of Business Ethics.
41. Epstein, M. J. (2008). Making sustainability work. Best practices in managing and measuring corporate social, environmental and economic impacts. Sheffield, San Francisco: Greenleaf Pub.; Berrett-Koehler Publishers.
42. Epstein, M. J., & Roy, M.-J. (2003). Making the business case for sustainability. Journal of Corporate Citizenship, 9, 79–96.
43. Eugénio, T. P., Lourenço, I. C., & Morais, A. I. (2013). Sustainability strategies of the company TimorL: Extending the applicability of legitimacy theory. Management of Environmental Quality, 24(5), 570–582.
44. European Commission. (2004). ABC of the main instruments of corporate social responsibility. Brussels: European Commission.
45. Figge, F. (2005). Value-based environmental management: From environmental shareholder value to environmental option value. Corporate Social Responsibility and Environmental Management, 12(1), 19–30.
46. Friedman, M. (1962). Capitalism and freedom. Chicago: University of Chicago Press.
47. Friedman, M. (1970). The social responsibility of business is to increase its profits. In R. Chadwick & D. Schroeder (Eds.), 2002. London: Applied Ethics, Routledge.
48. Gao, J., & Bansal, P. (2013). Instrumental and integrative logics in business sustainability. Journal of Business Ethics, 112(2), 241–255.
49. Gattiker, T. F., & Carter, C. R. (2010). Understanding project champions’ ability to gain intra-organizational commitment for environmental projects. Journal of Operations Management, 28(1), 72–85.
50. Hahn, R., & Kühnen, M. (2013). Determinants of sustainability reporting: A review of results, trends, theory, and opportunities in an expanding field of research. Journal of Cleaner Production, 59, 5–21.
51. Hahn, T., & Scheermesser, M. (2006). Approaches to corporate sustainability among German companies. Corporate Social Responsibility and Environmental Management, 13(3), 150–165.
52. Heede, R. (2014). Tracing anthropogenic carbon dioxide and methane emissions to fossil fuel and cement producers. Climatic Change, 122(1–2), 229–241.
53. Henri, J.-F., & Journeault, M. (2010). Eco-control: The influence of management control systems on environmental and economic performance. Accounting, Organizations and Society, 35(1), 63–80.
54. Hockerts, K. (2014). A cognitive perspective on the business case for corporate sustainability. Business Strategy and the Environment, doi:10.1002/bse.1813.
55. Hogan, J., & Lodhia, S. (2011). Sustainability reporting and reputation risk management: An Australian case study. International Journal of Accounting and Information Management, 19(3), 267–287.
56. Hooghiemstra, R. (2000). Corporate communication and impression management. New perspectives why companies engage in corporate social reporting. Journal of Business Ethics, 27(1–2), 55–68.
57. Hörisch, J. (2013). Combating climate change through organisational innovation: An empirical analysis of internal emission trading schemes. Corporate Governance, 13(5), 569–582.
58. Hörisch, J., Johnson, M., & Schaltegger, S. (2014). Implementation of sustainability management and company size: A knowledge-based view. Business Strategy and the Environment, doi:10.002/bse.1844.
59. IPCC (Intergovernmental Panel on Climate Change) (2008). Climate change 2007. Synthesis report. Available at: www.ipcc.ch/pdf/assessment–report/ar4/syr/ar4_syr.pdf. Retrieved from 20 Mar 2015.
60. IUCN (International Union for Conservation of Nature) (2008). Summary statistics for globally threatened species. Available at www.iucnredlist.org/static/stats. Retrieved from 20 Mar 2015.
61. Jeswani, H. K., Wehrmeyer, W., & Mulugetta, Y. (2008). How warm is the corporate response to climate change? Evidence from Pakistan and the UK. Business Strategy and the Environment, 17(1), 46–60.
62. Kim, Y., & Kim, S.-Y. (2010). The influence of cultural values on perceptions of corporate social responsibility: Application of Hofstede’s dimensions to Korean public relations practitioners. Journal of Business Ethics, 91(4), 485–500.
63. King, A. A., & Lenox, M. J. (2001). Does it really pay to be green? An empirical study of firm environmental and financial performance: An empirical study of firm environmental and financial performance. Journal of Industrial Ecology, 5(1), 105–116.
64. Kiron, D., Kruschwitz, N., Reeves, M., & Goh, E. (2013). The benefits of sustainability-driven innovation. MIT Sloan Management Review, 54(2), 69–73.
65. Kolk, A. (2003). Trends in sustainability reporting by the Fortune Global 250. Business Strategy and the Environment, 12(5), 279–291.
66. KPMG (2014). Corporate sustainability. A progress report, available at: http://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/Documents/corporate-sustainability-v2.pdf. Retrieved from 08 July 2015.
67. Lacy, P., Cooper, T., Hayward, R., & Neuberger, L. (2010). A new area of sustainability. CEO reflections on progress to date, challenges ahead and the impact of the journey toward a sustainable economy. Accenture.
68. Länsiluoto, A., & Järvenpää, M. (2010). Greening the balanced scorecard. Business Horizons, 53(4), 385–395.
69. Leck, H., & Simon, D. (2013). Fostering multiscalar collaboration and co-operation for effective governance of climate change adaptation. Urban Studies, 50(6), 1221–1238.
70. Lee, M.-D. (2011). Configuration of external influences: The combined effects of institutions and stakeholders on corporate social responsibility strategies. Journal of Business Ethics, 102(2), 281–298.
71. Machlup, F. (1967). Theories of the firm: Marginalist, behavioral, managerial. The American Economic Review, 57(1), 1–33.
72. Margolis, J. D., & Walsh, J. P. (2001). People and profits? The search for a link between a company’s social and financial performance. New York: Psychology Press.
73. Marmot, M. (2005). Social determinants of health inequalities. The Lancet, 365(9464), 1099–1104.
74. Michelon, G. (2011). Sustainability disclosure and reputation: A comparative study. Corporate Reputation Review, 14(2), 79–96.
75. Milanés-Montero, P., & Pérez-Calderón, E. (2011). Corporate environmental disclosure and legitimacy theory. A European perspective. Environmental Engineering and Management Journal, 10(12), 1883–1891.
76. Nishitani, K., & Kokubu, K. (2012). Why does the reduction of greenhouse gas emissions enhance firm value? The case of Japanese manufacturing firms. Business Strategy and the Environment, 21(8), 517–529.
77. Norberg-Hodge, H. (2006). Sustainable economies-local or global? In Marco Keiner (Ed.), The future of sustainability (pp. 99–115). Dordrecht: Springer.
78. O’Dwyer, B., Owen, D., & Unerman, J. (2011). Seeking legitimacy for new assurance forms: The case of assurance on sustainability reporting. Accounting, Organizations and Society, 36(1), 31–52.
79. OECD. (2012). Demographic Change and Local Development. Paris: OECD.
80. Pellegrino, C., & Lodhia, S. (2012). Climate change accounting and the Australian mining industry: exploring the links between corporate disclosure and the generation of legitimacy. Journal of Cleaner Production, 36, 68–82.
81. Pinkse, J., & Kolk, A. (2007). Multinational corporations and emissions trading: Strategic responses to new institutional constraints. Business, climate change and emissions trading. European Management Journal, 25(6), 441–452.
82. Porter, M. E., & Kramer, M. R. (2011). Creating shared value. Harvard Business Review, 89(1/2), 62–77.
83. Porter, M. E., & van der Linde, C. (1995). Toward a new conception of the environment-competitiveness relationship. Journal of Economic Perspectives, 9(4), 97–118.
84. Reimann, F., Ehrgott, M., Kaufmann, L., & Carter, C. R. (2012). Local stakeholders and local legitimacy: MNEs’ social strategies in emerging economies. Journal of International Management, 18(1), 1–17.
85. Revell, A., Stokes, D., & Chen, H. (2010). Small businesses and the environment: Turning over a new leaf? Business Strategy and the Environment, 19(5), 273–288.
86. Rodrigue, M., Magnan, M., & Cho, C. H. (2013). Is environmental governance substantive or symbolic? An empirical investigation. Journal of Business Ethics, 114(1), 107–129.
87. Russo, M. V., & Fouts, P. A. (1997). A resource-based perspective on corporate environmental performance and profitability. Academy of Management Journal, 40, 534–559.
88. Salzmann, O., Ionescu-Somers, A., & Steger, U. (2005). The business case for corporate sustainability: Literature review and research options. European Management Journal, 23(1), 27–36.
89. Sarkis, J., Gonzalez-Torre, P., & Adenso-Diaz, B. (2010). Stakeholder pressure and the adoption of environmental practices: The mediating effect of training. Journal of Operations Management, 28, 163–176.
90. Schaltegger, S., Lüdeke-Freund, F., & Hansen, E. G. (2012). Business cases for sustainability: The role of business model innovation for corporate sustainability. International Journal on Innovation and Sustainable Development, 6(2), 95–119.
91. Schaltegger, S., & Wagner, M. (2006). Integrative management of sustainability performance, measurement and reporting. International Journal of Accounting, Auditing and Performance Evaluation, 3(1), 1–19.
92. Schaltegger, S., Windolph, S. E., Harms, D., & Hörisch, J. (2014). Corporate sustainability in international comparison. State of practice, opportunities and challenges. Heidelberg: Springer.
93. Scott, W. R. (1995). Institutions and organizations. Thousand Oaks, CA: Sage Publications.
94. Scott, W. R. (2005). Institutional theory: Contributing to a theoretical research program. In K. G. Smith & M. A. Hitt (Eds.), Great minds in management: The process of theory development. Oxford: Oxford University Press.
95. Searcy, C. (2012). Corporate sustainability performance measurement systems: A review and research agenda. Journal of Business Ethics, 107(3), 239–253.
96. Sen, A. (2008). Rational Behaviour. In S. N. Durlauf & L. E. Blume (Eds.), The new Palgrave dictionary of economics. Basingstoke: Palgrave Macmillan.
97. Sharma, S., & Henriques, I. (2005). Stakeholder influences on sustainability practices in the Canadian forest products industry. Strategic Management Journal, 26(2), 159–180.
98. Shrivastava, P., & Hart, S. (1995). Creating sustainable corporations. Business Strategy and the Environment, 4, 154–165.
99. Sridhar, K. (2012). The Relationship between the adoption of triple bottom line and enhanced corporate reputation and legitimacy. Corporate Reputation Review, 15(2), 69–87.
100. Stanwick, P. A., & Stanwick, S. D. (1998). The relationship between corporate social performance, and organizational size, financial performance, and environmental performance: An empirical examination. Journal of Business Ethics, 17(2), 195–204.
101. Steger, U., Ionescu-Somers, A., & Salzmann, O. (2007). The economic foundations of corporate sustainability. Corporate Governance, 7, 162–177.
102. Stephan, U., & Uhlaner, L. M. (2010). Performance-based vs. socially supportive culture: A cross-national study of descriptive norms and entrepreneurship. Journal of International Business Studies, 41(8), 1347–1364.
103. Stephan, U., Uhlaner, L. M., & Stride, C. (2015). Institutions and social entrepreneurship: The role of institutional voids, institutional support, and institutional configurations. Journal of International Business Studies, 46(3), 308–331.
104. Székely, F., & Knirsch, M. (2005). Responsible leadership and corporate social responsibility: Metrics for sustainable performance. European Management Journal, 23(6), 628–647.
105. United Nations. (1992). Rio declaration on environment and development. Rio de Janeiro.
106. UNDP (United Nations Development Programme). (2010). Human development report 2010. 20th anniversary edition. The real wealth of nations. Pathways to human development, http://hdr.undp.org/sites/default/files/reports/270/hdr_2010_en_complete_reprint.pdf. Retrieved from 20th June 2015.
107. van Marrewijk, M. (2003). Concepts and definitions of CSR and corporate sustainability: Between agency and communion. Journal of Business Ethics, 44, 95–105.
108. van Marrewijk, M., & Werre, M. (2003). Multiple levels of corporate sustainability. Journal of Business Ethics, 44(2–3), 107–119.
109. Van Zyl, A. S. (2013). The importance of stakeholder engagement in managing corporate reputations. International Journal of Innovation and Sustainable Development, 7(1), 46–60.
110. von Weizsäcker, E. U., Hargroves, K., Smith, M., Desha, C., & Stasinopoulos, P. (2009). Factor five. Transforming the global economy through 80 % improvements in resource productivity, Earthscan. London: Routledge.
111. Vriend, N. J. (1996). Rational behavior and economic theory. Journal of Economic Behavior & Organization, 29(2), 263–285.
112. Wagner, M. (2006). Achieving environmental-economic sustainability through corporate environmental strategies: Empirical evidence on environmental shareholder value. In S. Schaltegger, M. Bennett, & R. Burritt (Eds.), Sustainability accounting and reporting (pp. 183–206). Dordrecht: Springer.
113. Wagner, M. (2010). The role of corporate sustainability performance for economic performance: A firm-level analysis of moderation effects. Ecological Economics, 69(7), 1553–1560.
114. Wang, L., Li, S., & Gao, S. (2014). Do greenhouse gas emissions affect financial performance? An empirical examination of Australian public firms. Business Strategy and the Environment, 23(8), 505–519.
115. WCED (World Commission on Environment and Development) (1987). Our common future. Oxford/New York: Oxford University Press. Available at: http://www.un-documents.net/ocf-02.htm#I. Retrieved from 27 July 2015.
116. White, A. L. (2004). Lost in Transition? The future of corporate social responsibility. Journal of Corporate Citizenship., 16, 19–24.
117. Windolph, S. E., Harms, D., & Schaltegger, S. (2014). Motivations for corporate sustainability management: Contrasting survey results and implementation. Corporate Social Responsibility and Environmental Management, 21(5), 272–285.
118. Woods, I. (2005). Investors look for corporate social responsibility. Civil Engineers Australia, 77(3), 8–11.
119. WWF (World Wide Fund for Nature). (2010). Living planet report 2010. Gland: WWF.
120. Yang, L., & Wu, J. (2010). Seven design principles for promoting scholars’ participation in combating desertification. International Journal of Sustainable Development and World Ecology, 17(2), 109–119.
121. Zhu, Q., Cordeiro, J., & Sarkis, J. (2013). Institutional pressures, dynamic capabilities and environmental management systems: Investigating the ISO 9000: Environmental management system implementation linkage. Journal of Environmental Management, 114(January), 232–242.