Exploring Consumers' Expectations of Sustainability in Mature and Emerging Markets

ABSTRACT

“Sustainability” has turned into a buzzword for businesses around the globe as consumers in mature and, increasingly, in emerging markets shift their demand toward sustainably enhanced products. Surprisingly, a global picture of consumers' expectations regarding sustainable products is still missing. This study uses exploratory factor analysis to determine the perceived importance and interrelation of selected sustainability aspects in three developed (Germany, Switzerland, United States) and three emerging (Brazil, China, India) markets. Results are linked to national cultural value theory to explore which sustainability aspects and positioning strategies may be promising to expand the outreach of sustainable products in developed and emerging markets alike. Results suggest that across the sampled economies, sustainability is increasingly considered as being comprised of a health aspect. While health and quality of life aspects emerged as key issues across countries, cultural backgrounds and local market conditions resulted in nuanced expectations of sustainability, which should be kept in mind in communicating and positioning sustainable products.     

The influence of relation-based and rule-based regulations on hiring decisions in the Australian and Hong Kong Chinese cultural contexts

Investigation of the cultural factors that may influence the employment decisions of managers is of increasing importance in the global business environment. The purpose of this research is to examine whether particularistic ties based on friendship influence hiring practices in relation-based (Hong Kong Chinese) and rule-based (Australian) cultural contexts. Three studies were conducted to examine this research question. Results indicate that friendship-based particularistic ties, specifically guanxi and mateship, can influence hiring decisions in both relation- and rule-based cultural contexts. The results of the studies have implications for human resource managers with regards to staffing organizations operating in different cultural contexts.     

Relationship Quality and the Theory of Planned Behavior models of behavioral intentions and purchase behavior

Using real-life purchase behavior data of apparel and survey information, this study compares the Relationship Quality and the Theory of Planned Behavior models. The attitude towards the buying behavior, the subjective norm and perceived behavioral control (antecedents of the buying intention in the Theory of Planned Behavior) are better predictors of behavioral intentions than Relationship Quality. In both models intentions fully mediate the impact of attitudinal antecedents on behavior, both in terms of purchase incidence and purchase behavior (amount spent, number of visits, and types of products bought). Frequency and recency of prior buying behavior and, to a lesser extent, its monetary value, predict subsequent purchase incidence, above and beyond the impact of attitude and intention. Attitudinal antecedents of behavior significantly predict buying behavior, but they become insignificant when buying behavior is included in the model.     

GOVERNANCE INSTITUTIONS AND PRIVATE INVESTMENT: AN APPLICATION TO THE MIDDLE EAST AND NORTH AFRICA

This paper addresses the issue of the low level of private investment in the Middle East and North Africa (MENA) region, with special emphasis on the role of governance. Based on the existing published reports, we categorize what types of governance institutions are more detrimental to entrepreneurial investments. We then estimate a simultaneous model of private investment and governance quality where economic policies concurrently explain both variables. Our empirical results show that governance plays a significant role in private investment decisions. This result is particularly true in the case of “administrative quality” in the form of control of corruption, bureaucratic quality, investment‐friendly profile of administration, law and order, as well as for “political stability.” Evidence in favor of “public accountability” is also found. Our estimations also stress that structural reforms like financial development, trade openness, and human development affect private‐investment decisions directly, and/or through their positive effect on governance.     

Linking owner–managers' personal sustainability behaviors and corporate practices in SMEs: The moderating roles of perceived advantages and environmental hostility

Drawing on managerial discretion and conflicting institutional logics literature, this study investigates the relation between the personal sustainability behaviors (PSB) of owner–managers and the corporate sustainability practices (CS practices) of SMEs. The research proposes a contingency model that assesses the moderating effects of perceived economic advantages and environmental hostility on this relationship. Based on linear hierarchical multiple regression analyses of a cross‐sectoral sample of French SMEs, the results suggest a positive influence of the manager's PSB on the SME's CS practices that appears to be differently moderated depending on the type of practice considered. The influence on environmental practices is fostered through the perception of economic advantages. The influence on workplace practices is only effective when the business environment is deemed benign and the influence on community practices is dampened by the perception of environmental hostility. Highlighting the trade‐off between the manager's personal values and the SME's economic constraints, these findings contribute to a better understanding of the critical antecedents of sustainability in small businesses.     

Measuring sustainability risks: A rational myth?

The objective of this paper is to investigate the rigorousness and reliability of sustainability rating agencies' evaluation of corporate sustainability risks. Using grounded theory, this study conducts a qualitative analysis of 32 semi‐structured interviews with practitioners involved in this activity and shows the trade‐offs and rational myths underlying this evaluation process. The image of rationality and rigorousness projected by sustainability risk measurements is mostly intended to address the increasing institutional pressures for reliable and comparable information, particularly from institutional investors and socially responsible investment decision makers. Nevertheless, risk analysts face serious challenges due to the lack of reliable information, the unpredictability of sustainability risks, the methodological issues related to the measurement process, and the complexity and context‐dependency of risk assessment. These challenges call into question the official and optimistic rhetoric of rating agencies. This study contributes to the literature on sustainability risks and rational myths in organizations. Managerial implications and avenues for future research are also discussed.     

Institutional and organizational trajectories in social economy enterprises: Resilience,transformation and regeneration

Social economy enterprises (SEEs) are arousing notable interest as promising alternatives where social innovation, business ownership and governance are concerned. In this context, a renewed debate about the internal changes and organizational trajectories experienced by these organizations has emerged in the scholarly literature. This special issue aims to contribute to ongoing debates in this field by advancing our understanding of the external pressures and internal dynamics that can trigger degeneration in SEEs, the conditions and factors that allow SEEs preserving their hallmark values and practices, and the resources and processes of organizational change that SEEs can deploy to overcome degeneration and regenerate. In this editorial introduction we introduce the topic of research, describe the content of the current special issue, and highlight some conclusions and possible directions for future research.     

Lone star or team player? The interrelationship of different identification foci and the role of self‐presentation concerns

Work identity is important in the attraction and retention of staff, yet how the facets of such identity relate remains convoluted and unclear despite this being of interest to both scholars and practitioners. We use structural equation modeling to analyze empirical data from 144 employees in the United Kingdom's oil and gas industry, analyzing the nature and interrelationship of identification as individual‐level (career advancement) and social‐level (work group and organization) foci, as well as considering the two psychological self‐presentation factors (value expression and social adjustment) that direct and drive identification processes. A dichotomy between individual and social components of work identity is found, revealing a strong association between both social‐level foci of identification. Moreover, both components of work identity are found to be premised on different psychological factors, furthering our knowledge of the enmeshed nature of identity at work.     

Outside CEOs and innovation

Research Summary: Innovation is the principle driver of firm and economic growth. Thus, one disturbing trend that may explain stagnant growth is a 65% decline in firms’ R&D productivity. We propose that the rise of outside Chief Executive Officers (CEOs) may be partially responsible for the decline because those CEOs are more likely to lack technological domain expertise necessary to manage R&D effectively. While this proposition was motivated by interviews with Chief Technology Officers (CTOs), we test it at large scale. We find that firm R&D productivity decays during the tenure of outside CEOs relative to that of inside CEOs. We further find this effect is more pronounced for firms with high R&D intensity and for firms employing outside CEOs with more remote experience, lending circumstantial support for the underlying assumption regarding lack of expertise. Note that this is not a call for boards to avoid outside CEOs, rather it is recommendation to consider the implications for innovation. Managerial Summary: While outside CEOs offer advantages over internal candidates, we argue one unintended consequence is weaker innovation. This argument was prompted by two coincident trends: a 65% decline in companies’ R&D productivity and a doubling of outside Chief Executive Officers (CEOs). The argument was reinforced by interviews with Chief Technology Officers (CTOs), who recounted shifts in orientation from R&D as an investment to R&D as an expense that occurred shortly in response to a new CEO. We felt this shift was more likely with outside CEOs because they may lack technological domain expertise necessary to effectively manage R&D. Our results are consistent with the argument—company R&D productivity decreases under outside CEOs. Note, however, that we don’t advocate avoiding outside CEOs, rather we recommend R&D firms consider technological domain expertise during CEO hiring.