The Sustainability Balanced Scorecard – linking sustainability management to business strategy

The Balanced Scorecard of Kaplan and Norton is a management tool that supports the successful implementation of corporate strategies. It has been discussed and considered widely in both practice and research. By linking operational and non‐financial corporate activities with causal chains to the firm's long‐term strategy, the Balanced Scorecard supports the alignment and management of all corporate activities according to their strategic relevance. The Balanced Scorecard makes it possible to take into account non‐monetary strategic success factors that significantly impact the economic success of a business. The Balanced Scorecard is thus a promising starting‐point to also incorporate environmental and social aspects into the main management system of a firm. Sustainability management with the Balanced Scorecard helps to overcome the shortcomings of conventional approaches to environmental and social management systems by integrating the three pillars of sustainability into a single and overarching strategic management tool. After a brief discussion of the different possible forms of a Sustainability Balanced Scorecard the article takes a closer look at the process and steps of formulating a Sustainability Balanced Scorecard for a business unit. Before doing so, the basic conventional approach of the Balanced Scorecard and its suitability for sustainability management will be outlined in brief. Copyright © 2002 John Wiley & Sons, Ltd and ERP Environment.     

Payments for ecosystem services and corporate social responsibility: Perspectives on sustainable production,stakeholder relations,and philanthropy in Thailand

Payments for ecosystem services (PES) are environmental management tools that enable corporations to simultaneously enhance their environmental performance and fund sustainable development in rural areas. PES is primarily promoted as part of a sustainable production strategy for conserving natural resources, offsetting carbon emissions, and green supply chain management. Nevertheless, PES uptake by the private sector remains low, and few studies have analysed whether corporate‐financed PES schemes conform to this rationale. This study evaluates three of the first PES schemes in Thailand, financed by large corporations in the water utilities, aquaculture, and beverage sectors. Interviews with 39 business managers and project stakeholders suggest that PES may be viewed as a tool for philanthropy, public relations, and gaining license to operate—akin to many corporate social responsibility initiatives. Explanations and ramifications are discussed in the context of ecological uncertainty, risk management, financial performance, organisational learning, and the corporate‐engagement strategies of non‐governmental organisations.     

Sustainable tourism in Greek islands: the integration of activity‐based environmental management with a destination environmental scorecard based on the adaptive resource management paradigm

Tourism is a major industry that can lead to economic gains as well as to degraded environment and social infrastructure. Tourism has the potential to destroy the available common environmental resources through overuse and poor management practices, as limited information disclosure and poor monitoring of actions encourage the perpetuation and extension of environmental problems. Based on the adaptive resource management paradigm for addressing problems related to the use of the commons, this paper suggests a methodology for the development of a management tool that can provide island hotels with a continuous flow of timely, relevant, accurate and objective information on the environmental impact of critical corporate activities. The tool, named the destination environmental scorecard (DES), draws on activity‐based management concepts and can help local hotel SMEs measure and compare their performance against certain standards and thus conduct operations in a responsible and measurable way to the benefit of both business financial performance and regional sustainability. The paper presents the DES operational characteristics and the potential benefits from its implementation. Copyright © 2008 John Wiley & Sons, Ltd and ERP Environment.     

Defining Eco‐efficiency: A Case Study on the Finnish Forest Industry

Environmental reporting is a tool of corporate environmental management that can also be used as research material. The aim of this paper is to produce a comprehensive definition of eco‐efficiency based on the literature and then compare it with definitions identified in the environmental reports published by selected companies. In addition, this paper presents a conceptual framework of the relationship between environmental and economic performance in the companies. Three Finnish companies in the forest industry are selected as case companies. This analysis reviews environmental reports published by the companies from 1998 to 2007. In short, eco‐efficiency can be seen either as an indicator of environmental performance, or as a business strategy for sustainable development. The case companies very seldom give an exact definition of eco‐efficiency in their environmental reports. However, different aspects of eco‐efficiency are often referred to. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.     

Sustainable Development in the Transport Sector: Influencing Environmental Behaviour and Performance

Sustainable Development and Environmental Policy are becoming increasingly important in the development of business strategies. Consequently, corporate road freight transport comes under particular scrutiny due to its substantial impact on the environment. This paper explores the implementation of environmental management in the Austrian road freight transport sector. A model based on an extensive literature review is developed and adapted to show the impact of attitude, company size and sector affiliation. It is tested using data from a quantitative survey. Based on an extensive literature review a model of influencing factors is developed and tested using data from a quantitative survey. According to our findings, we adopted the model with respect to the impact of attitude, company size and sector affiliation. Although decision‐makers' attitudes have a significant influence on the companies' actual environmental performance, firm size and sector affiliation are shown to have a far greater influence. It is therefore necessary to offer external incentives and support in order to improve environmental behaviour, especially among smaller and transport companies. Such instruments, however, need to be aligned on an international basis and across industries to prevent friction and competitive disadvantage. In addition to policy intervention (legal restrictions and incentives) and improvements on a corporate level, consumer awareness should be raised in order to create public pressure for companies to implement environmental management. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.     

Tales in two countries: An insight into corporate environmental reporting in Denmark and the UK

The 1992 EC Fifth Action Plan, ‘Towards Sustainability’, expresses the Commission's commitment to ‘sustainable growth’. Detailed in the plan are requirements and areas of improvement which relate, predominantly, to environmental management. However, financial and environmental management conflict in important and fundamental areas. A failure of management practice and European policy to identify and address this conflict will not only prolong the ecological inefficiencies of industry but will isolate intent and action. This study examines this conflict with respect to training, operational time-horizons, opportunity costs, corporate governance and growth. The Annual Report is the authoritative statement of corporate performance, policy, objectives and culture. Although most reports do provide a broad if summary coverage of the main business activities, such reports are dominated by the needs of financial management. Extensive legislation and professional edicts dictate the contents of these financial reports. From the perspective of the Annual Report, it is a reasonable conclusion that financial performance is a part of whatever constitutes the core values of corporations. From this same perspective, it is also reasonable to infer that in many corporations environmental performance is not a part of corporate core values. This study compares and contrasts the Annual Reports of six environmentally significant companies in Denmark and the UK. The British environmental reports studied are thorough but separate from the Annual Report. On the other hand, the Danish firms incorporate all their environmental reporting within their Annual Reports. Which gives a better expression of a change in corporate core values?.     

Assessing the impact of green supply chain practices on firm performance in the Korean manufacturing industry

As a growing number of customers tend to view corporate social responsibility (CSR) as a key purchase decision criterion, demands for CSR including environmental sustainability have accelerated in today's business world. To meet such demands, many firms consider embracing environment-friendly business practices. However, many firms are still hesitant to implement those practices due to sceptical views about their real managerial benefits. Although the previous literature confirms the positive link between a firm's commitment to environmental sustainability and its performance, the varying degree of impact of different kinds of environment-friendly supply chain practices on the firm's operational performance is still unknown. To fill the void left by prior research, this paper aims to classify various types of green supply chain management (GSCM) practices and then assess the impact of each of these distinct types on the firm's operational performances (especially manufacturing and marketing performance). Also, this paper examines how the firm's organisational profiles such as firm size affect the particular firm's choice of GSCM practices. Our experimental results reveal that the chosen type of GSCM practices influences the firm's performance differently.     

Environmental strategy and low waste operations: exploring complementarities

Organizations require guidance on the most effective functional areas in which to invest in order to improve and sustain environmental performance. As managerial practices progress from concerns with compliance towards practices seeking competitive advantage, more theory is needed regarding the manner in which corporate strategy and operational practices influence environmental performance. This research considers the potential for previously under‐researched complementarities between strategy and operations and the bridging role of environmentally specific practices such as the use of environmental experts as determinants of environmental performance. Using a sample of manufacturing firms, this study explores the relative contribution to environmental performance of strategic intentions, core operational practices such as data and quality management and environmentally specific practices that link strategy to operations. The most significant influence on environmental performance was found to be environmental expertise – which creates a bridge between strategy and operations – and information‐intensive practices such as quality and data management. Strategic intentions or core operational practices in isolation were not considered sufficient support to successfully maintain or improve environmental performance. This research provides a contribution to our understanding of interactions between those functions that have the greatest influence on environmental performance management in manufacturing firms. Copyright © 2008 John Wiley & Sons, Ltd and ERP Environment.     

Sustainability in the Transport and Logistics Sector: Lacking Environmental Measures

Sustainability as part of the development of companies' business strategies is gaining in importance. Due to its impact on the environment, this is particularly essential for companies of the transport and logistics sector. This paper explores several factors that influence the environmental behaviour of transport and logistics companies in Austria. It discusses the importance of the economic impact on environmental management decision in detail and analyses the sector's specific characteristics in terms of environmental behavior. A case‐based approach involving multiple field studies with face‐to‐face expert interviews and secondary data analysis was used to evaluate environmental performance and specific practices. Using selected cases, we will demonstrate how environmental measures contribute to overall business performance and draw general conclusions regarding the transport and logistics sector. Furthermore, suggestions are given as to how the government can further support transport and logistics companies in this regard. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment.     

The 100 plus corporate environmental report study: A survey of an evolving environmental management tool

An emerging environmental management tool is the corporate environmental report, a free-standing document, analogous to the corporate annual report, but which covers environmental and often health and safety issues. This study examines the nature of the corporate environmental reports of large, public, US companies to determine which companies produce reports, what type of information is reported, how this information is presented, and who might be the audiences for this information. This study also seeks to identify state of the art practice in corporate environmental reports, drawing on the US reports and leading environmental reports from Europe and Canada. Over 100 US companies now publish corporate environmental reports. These companies are primarily from the manufacturing sector, although they are increasingly part of the service sector. Report issuers identified employees and shareholders as their primary audiences. Both overall report organization and composition as well as report distribution, including the use of the Internet for environmental reporting, were examined. Topics which reflect leading edge environmental practice are identified and examples from reports are given. These topics include integrating business and environmental performance, environmental policy, goals and measurement, management and organizational structure, environmental and resource data presentation, third-party verification, disclosure of negative information, and sustainability. The paper discusses trends in reporting and makes recommendations to improve reports.© 1997 John Wiley & Sons, Ltd and ERP Environment.     

Applying the reduce,reuse, and recycle principle in the hospitality sector: Its antecedents and performance implications

Although the literature on eco-friendly strategies followed by firms is abundant, the focus on the reduce, reuse, and recycle (3Rs) policies as the cornerstone of environmental sustainability is scarce. This study examines the 3Rs environmental strategy among 143 large organizations in the hospitality industry. We use the resource-based view (RBV) of the firm theory to test the strategy's determinants and its impact on business performance on a suggested conceptualization level. As hypothesized, green corporate governance and environmental management systems, along with slack financial resources, were found to positively influence the adoption of a 3Rs environmental strategy. In turn, the implementation of the latter leads to superior business performance, measured in terms of operating profits and Tobin's Q. The study has several implications on a theoretical, managerial, and public policy level where intriguing directions for future research are provided.     

Paving the road toward eco-effectiveness: Exploring the link between greenhouse gas emissions and firm performance

Climate change has increasingly attracted business attention over the last decade, focusing particularly on the eco-efficiency debate. The goal of this paper is twofold. First, we contribute to the ongoing debate on the effects of environmental strategies on firm performance. We investigate this relationship by considering the relative greenhouse gas emissions (GHG) as a predictor of the eco-efficiency of firms' environmental strategies. GHG emissions are a direct indicator of the environmental performance and effectively measure the firm's efforts in mitigating the impacts related to its processes and products. Second, we investigate the drivers that lead to an increase in the firm's environmental impact under the conditions of increasing market performance by the firm, therefore paving the road to the concept of eco-effectiveness of corporate environmental strategies. To test our hypotheses, we use a sample of worldwide listed companies derived from the S&P 1200 list. A longitudinal analysis is run through generalized least squares regression models over the period 2004–2016. Results offer evidence of the direct relationship between the level of absolute emissions and market performance of the firm. Therefore, the findings have significant implications on the way we conceptualize corporate environmental sustainability and environmental strategies, shedding new light on the relation between environmental pressures and corporate growth.     

How do green knowledge management and green technology innovation impact corporate environmental performance? Understanding the role of green knowledge acquisition

Increasing regulatory obligations to adapt and execute environmentally friendly operations make it critical for businesses to pursue strategies that can strengthen their competitive edge in the market. Academics and practitioners alike have recently gravitated toward exploring how knowledge acquisition activities might improve business outcomes. To address this growing research interest, this study investigates the critical roles of green knowledge acquisition in enhancing green knowledge management and green technology innovation activities in improving corporate environmental performance, positioning resource commitment as a moderator. The research model has been assessed using structural equation modeling with survey data from 283 Indian manufacturers, demonstrating that green knowledge acquisition significantly impacts green knowledge management and green technology innovation. The statistical findings also show that green technology innovation acts catalyzes the translation of green knowledge management into improved corporate environmental performance. The results demonstrate that resource commitment moderates green knowledge acquisition's interaction with green knowledge management and green technology innovation, providing practical insights enabling managers to focus on planning, allocating, and budgeting resources for effective green practices that can contribute to improving corporate environmental performance.     

The influence of managerial satisfaction on corporate environmental performance and reputation

Organizational studies have widely debated the relationship between job satisfaction and job performance. Some papers have dealt with managerial satisfaction and businesses' performance adopting agency theory to interpret the results. However, no studies have yet considered the relationship between the satisfaction levels of an environmental manager and corporate environmental performance. This paper thus analyses the role played by the environmental manager's satisfaction in enhancing corporate environmental performance and reputation. The paper uses data from a survey of 412 Eco Management and Audit Scheme registered organizations. The results show a positive relationship between managerial satisfaction and environmental performance, whereas no such positive relationship was found when considering eco‐innovation performance. In addition, the environmental manager's satisfaction has a positive and indirect influence on the corporate environmental reputation. These results contribute to the literature on agency theory and aim to extend the debate between job satisfaction and job performance to the sustainable business field.     

Environmental visibility: a trigger of green organizational response?

This paper develops a typology of visibility in an environmental context. Although visibility has been neglected and ill defined in contemporary environmental management research, environmental visibility can be a useful construct for predicting green organizational response. As such, it might prove a useful tool for environmental management researchers, policy‐makers and business strategists. The paper derives a conceptual typology of visibility from previous organizational theory research. Visibility is considered both as a characteristic of an organization and as a characteristic of an issue, and at both the corporate and operating unit levels. Data collected in a recent series of interviews in 24 business units in UK PLCs are analysed to provide examples of the types of visibility in an environmental context. The resultant environmental visibility typology is used to discuss the relationship between environmental visibility and green organizational responses. This study's findings suggest that considering environmental visibility as a predictor of green organizational response should be fruitful for future empirical research, and useful for policy‐makers and business strategists. Copyright © 2000 John Wiley & Sons, Ltd and ERP Environment     

The impact of direct environmental,social, and governance reporting: Empirical evidence in European-listed companies in the agri-food sector

Companies are continuously pressured for the dissemination of environmental, social, and governance (ESG) information, because of the constant debate on the issue of corporate sustainability, considered a critical and very important topic for society; despite this pressure, ESG's disclosure practices vary considerably from company to company, both in quantity and quality. The study aims to address the issue and verify the effectiveness of ESG reporting through the influence that the ESG disclosure has on profitability and value of listed European agri-food companies. The results obtained, studying a sample of 57 European-listed companies (EU28) in the agri-food sector observed in the period 2010–2018, show that the ESG disclosure practices of the companies impact corporate profitability; specifically, evidence is provided for the existence of a positive relationship between profitability and disclosure practices of strictly environmental and social information and a negative effect between company market value and disclosure practices relating to governance. These results suggest that greater transparency and accountability help to improve business profitability.     

Ecological responsiveness and business performance: Four scenarios of compatibility and a multi-faceted strategies framework

This paper investigates the link between business actors' perceptions of the compatibility between ecological responsiveness and business performance and the level of corporate commitment to address ecological issues. The dichotomy between peripheral (or symbolic) actions and embedded (or substantive) actions traditionally assumed in business research arguably reflects a limited conceptualisation of the link between ecological responsiveness and business performance. It fails to exhaustively explain how companies create, maintain, or disrupt practices that affect the natural environment. Combining insights from a conceptual framework that encompasses four scenarios of compatibility (trade-off, ambidexterity, synergy, and symbiosis) and 50 interviews with 25 management consultants, the results show that perceptions of compatibility are associated with a valence of business responses towards either maturation strategies (accommodative, philanthropic, progressive, and consolidative) or minimalistic strategies (lackadaisical, compliance, opportunistic, and cosmetic). The findings bring greater nuance to key forms of corporate ecological responsiveness, and how business agents' interpretations play a key role in shaping a firm's activities in this domain.     

Are top human resource specialists 'strategic partners'? Self-perceptions of a corporate elite

Despite the existence of various large-scale surveys of human resource specialists, there has been little research focusing specifically on the top cohort of HR practitioners. In addition, the surveys offer little insight into the ambiguous, but important questions associated with the strategic management process in large, complex corporations. This article reports a study of the qualifications, work histories, role orientations and strategic contributions of the most senior HR specialists in the New Zealand business sector. These elite practitioners typically demonstrate a 'dual background' in specialist HR activities and line management, and strongly subscribe to Legge's notion of 'conformist innovation'. As in the United Kingdom, they tend to focus primarily on the management of managers and, to a lesser extent, the management of industrial relations. Their work is increasingly integrated with other spheres of the business such as quality management. Whether their contribution is regarded as 'strategic' depends on the model of strategic management that informs the question. This paper argues that the survey-based studies have inappropriately adopted 'outside-in' models of strategic management which privilege marketing notions and assume that 'formulation' is more strategic than 'implementation'. The work of these senior HR specialists is more fairly assessed under a conception of the strategic problem which balances external and internal concerns. Given the present realignment of strategy theory, the challenge facing these HR specialists is that of developing frameworks for corporate planning and performance analysis which attribute a more central role to the critical elements of HRM.     

Circular economy and the policy: A framework for improving the corporate environmental management in supply chains

The transition to the circular economy (CE) creates value through the closed-loop systems, reverse logistics, product life cycle management, and clean production in terms of corporate environmental management. During this transition process, the organization faces many barriers such as financial, organizational, technology-based, social, policy-related, market-based, and logistics-based barriers. The objectives of this study are to propose a framework highlighting policy-related barriers for a supply chain in the transition to CE and finally discuss potential implications on enhancing corporate environmental performance of a business. Further, this study evaluates the causal relationships between the policy-related barriers using fuzzy Decision-Making Trial and Evaluation Laboratory (DEMATEL) method. The application was conducted in an apparel firm in Turkey. From findings, lack of legislation for efficient CE (C4), lack of mandatory requirements and responsibilities for manufacturers/suppliers for the CE (C17), and lack of government support for environmentally friendly policies (C2) are revealed as the most important barriers, respectively. It is found that lack of attitude and awareness about CE in government institutions (C19) is the most influencing factor, whereas lack of effective recycling policies to achieve quality in waste management (C8) is the most influenced factor. The recommendations were developed for enhancing the corporate environmental performance of businesses through incentives and unique rewards, improving communication among stakeholders, the government's perception of CE and current linear economy, cooperation with nongovernmental organization (NGOs) and civil actions, the vision of government towards circular principles, the circular public procurement, the local governments in circular policymaking, and awareness of bureaucracy and government officials.