Guest editorial

Guest editorial

Guest editorial

Article Type: Guest Editorial From: Management of Environmental Quality: An International Journal, Volume 23, Issue 6.

This special issue is born from the 1st International Symposium on corporate responsibility and sustainable development, held at London Metropolitan University in April 2011. The symposium aimed to explore emerging issues and innovative developments in corporate responsibility, and its relationship with the broader notion of sustainable development. Presentations were wide ranging reflecting particular challenges and developments from around the world, but all were focused on examining both tensions and opportunities at the interfaces between economic, environmental, social, and cultural dimensions. Topics were loosely grouped into strategy, policy, and theory and principles. There was also a track dedicated to exploring corporate responsibility thinking and practice within China. The event brought together researchers, practitioners, teachers, students, from 16 countries. The event uniquely provided researchers and teachers an insight to the perspectives and priorities of professionals working in diverse fields, while practitioners in turn had the opportunity to hear about new research and thinking about the nature of corporate responsibility.

For this special issue of MEQ we have selected seven papers that focus on different aspects of corporate responsibility, including an exploration of developments in corporate environmental responsibility in India; an empirical study of sustainability reporting by some of France's listed banks examining how these companies prioritise social and environmental concerns alongside financial imperatives; the exploration of a management philosophy that accommodates the apparent contradictions between economic, environment, social, cultural imperatives; a proposal to introduce voluntary carbon trading markets in Kazakhstan such that companies are encouraged to reduce their carbon footprint while helping Kazakhstan fulfils its commitment to the Kyoto climate change protocol; a framework that categories countries according to their level of sustainable development which extractive sector companies can use as a guide in developing their own strategies when operating in particular sovereign environments; a categorisation of the different ways that companies seem to interpret sustainability, from the narrow focus on financial targets to the comprehensive triple bottom line; a proposed new approach for encouraging and guiding small- and medium-sized enterprises (SMEs) towards being more engaged with their environmental responsibilities.

Sindhi and Kumar provide a useful review of the literature on how companies and legislators regard the corporation's environmental responsibilities, with a particular focus on trends and developments in India. They pull together the literature into a number of broad areas to highlight that the significant influences on corporate behaviour towards the environment depends on a range of external and internal factors, and on the constraining effects of managerial cognitive habits and institutional momentum. These factors help highlight the drivers that both compel and incentivise businesses and legislators operating within a developing economy. Within such an evolving environment we see businesses and legislators gradually progressing from reactive compliance towards being proactive as they adjust how they perceive the benefits of business minimising its impact on the environment. This paper could be the basis for empirical studies of corporate practices among Indian companies, as well as studies that examine the pace and direction of legislative development as India's economy continues to mushroom.

In 2002 France introduced legislation (Article 116) requiring companies to report on the social and environmental consequences of their operations. Husser examined how a sample of French listed companies respond to Article 116. He found the structuring and content of these companies’ sustainability reports put more emphasis on communicating social issues with employees, compared with customers and suppliers, but prioritise economic considerations in their communication with these latter two stakeholder groups. In general the reporting behaviour of these firms prioritise the economic, with the social and environmental dimensions taking second and third place, respectively. Across all sectors, sustainability reporting shows that measurable short-term performance assessment continues to crowd out more medium- and long-term action. Overall his evidence suggests that sustainability reporting shines an interesting light on corporate behaviour. Through reporting firms reveal they are taking early learning steps on how to implement sustainability thinking in terms of their relations with key stakeholders, and the how they priorities between economic, social, and environmental.

Martinez reviews literature not commonly cited in debates about enterprise/corporate social responsibility (ESR/CSR), challenging the belief that business interests necessarily diverge from those related to environmental care and social equity. He explores the notion of syncretism as a management philosophy, which seeks to reconcile the apparently incompatible goals of business performance and environmental care. He proposes two models of syncretism, one being top down (systemic/pragmatic) and the other being bottom up (social constructionist/ethnographic). Martinez suggests that syncretism may be achieved by seeing the developmental needs of business systems as analogous to those of living organisms; economically healthy businesses depend on access to appropriate resources. While living organisms seem to have symbiotic relations with their environment, or even a catalytic function, business systems do not evidently possess such relationships. Arguably business systems do play a transformative role in society, melding resources (financial, human) within a supportive political economic environment. One implication of Martinez's ideas is that business leaders and investors need to rethink the traditional distinction between cost and investment. He suggests these concepts (syncretism and metabolism) provide opportunities for empirical studies.

Kazakhstan is the largest land-locked country in the world, approximately the size of western Europe, with a population of just 16 million. Sabitova offers insights to the challenges and benefits of introducing voluntary carbon markets within Kazakhstan, a newly emerging economy. She takes a normative position, proposing a policy of encouraging firms to offset their carbon emissions against forest conservation and reforestation in order to help reduce Kazakhstan's greenhouse gas emissions, and help the country meet its commitment to the Kyoto protocol. Based on her assessment of existing carbon trading arrangements in other parts of the world (ranging from regulated to voluntary), she argues for Kazakhstan businesses adopting voluntary carbon trading, largely because the strict entry criteria for joining a compliance-based market, such as the Chicago Climate Exchange market is out of reach for Kazakhstan. Importantly, Sabitova outlines the challenges to maintaining the country's forests. She identifies a mix of inherent and ever present environmental risks (large-scale fires, often followed by infestations), illegal activity (tree cutting), low corporate awareness of CSR, and lack of legislation to stimulate awareness.

Walsh develops an interesting framework for categorising countries according to their levels of sustainable development along environmental, social, and economic dimensions. These categories then provide extractive sector firms (ESFs) a basis for determining their own social and environmental practices. In past times countries identified as setting relatively low corporate social and environmental performance expectations (typically developing economies), would represent an invitation for extractive sector firms to lower their own investments in environmental protection programmes, projects, and practices. Walsh suggests that ESFs can use his framework for setting their social and environmental practices, from being reactive to proactive. He suggests that in countries where ESFs face lower sustainable environment development criteria (his categories: purgatory, capitalist, social capitalist, socialist) then ESFs should be proactive, by looking for ways of providing social and environmental initiatives that have a positive impact. For those countries with already high levels of sustainable environment development (his categories: green, green capitalist, green socialist) Walsh proposes ESFs take a reactive approach in developing their social and environmental impact practices. It would be interesting to know whether all ESFs have moved on from the minimal environmental and social provision of yesteryear, to being proactive in the ways that Walsh suggests. For example, one might expect the attitudes of ESFs towards sustainable development to differ, depending on whether the ESF is from a developed or developing economy.

Swanson and Zhang categorise organisations in terms of their engagement with sustainability. Based on a selective survey of the literature they confirm that organisations interpret the notion of sustainability in different ways. Some organisations focus almost exclusively on one purpose, financial goals or advocacy (focused mission category). The authors suggest that those engaged in “green washing” hide in this category, intent on promoting the impression that they are committed to responsible business practices. More enlightened firms (responsible sustainability) focus on financial self-sufficiency, while taking measures in their operations to either minimise their negative impacts or advancing the state of environmental, or social and cultural conditions. They further categorise as blended mission sustainability, organisations with a double bottom line approach, making an explicit commitment in their mission to prioritise not only financial goals but also one other goal, whether social, environmental, or cultural. The comprehensive mission category is preserved for those committed to the triple (or quadruple) bottom line. Swanson and Zhang agree with other studies that one significant reason for such variety of interpretations and approaches is due to managerial inability to see (understand) and operationalise the complexities inherent in delivering a comprehensive triple bottom line. Their investigations and interpretation lay the foundation for future empirical work, for example to test their categorisation, identifying managerial motivations, challenges to achieving sustainability aspirations, and novel approaches to overcoming those challenges.

SMEs as a group is recognised as being a significant employer and contributor to GDP in most economies, and so their social and economic impact is significant. At the same time they are commonly criticised for having a poor record for environmental impact performance. Reflecting on work carried out with a large UK food distributor and its (SME) supply chain, Howarth and Fredericks proposes a framework for encouraging SMEs to engage more fully with the sustainability agenda. They suggest the need for an interventionist approach to enabling change in SME behaviour, involving a facilitator (such as a university partner or customer). The facilitator helps the SME owner/managers develop a more enriched perspective of sustainability through taking the SME leadership through three phases. The intervention begins with showing SME leaders that achieving sustainability requires more putting in place procedures and controls, but to rethinking their business model, then finally to cooperating with supply chain partners in order to develop ways of minimising environmental impacts and adding value. The mentor (facilitator) is clearly critical, and it seems likely that the success of this approach to changing SME behaviour rests entirely on the knowledge and expertise of the mentor and on trust relations between SME owner/manager and the mentor. It is common for the customer (here the large food distributor) to work with suppliers in order to meet design, quality, cost targets. There seems no reason why the customer could not also mentor the SME on sustainability practices.

Taken together the papers in this special issue offer a number of different insights. Most of them address the focal point of the symposium: the relationship between state (as context and legislator), inter-governmental policy agreements and corporate strategy. In Walsh's paper we find a framework for helping extractive firms understand the host state's level of commitment to sustainable development, thereby providing the basis for firms to develop appropriate sustainability practices. In short, the firm's strategy should compliment government policy (or practice) on sustainable development. Sabitova's proposal for the reduction of greenhouse gases in Kazakhstan is a model requiring legislation, education, and inducements to encourage corporations to take part in a voluntary carbon trading market. Husser's study of sustainability reporting explores the extent to which French listed companies are meeting the requirements of French Law on companies reporting their sustainability performance (Nouvelles Régulations Economiques, Article 116). In Sindhi and Kumar's paper we see the interplay of factors affecting corporate environmental reporting including India's evolving regulatory framework and institutional forces. Swanson and Zhang take as context various globally recognised commitments to sustainable development, and they explore the extent to which business practices reflect those commitments. Howarth and Fredericks's reflective paper on SMEs provide a different focus but the supply chain context is significant since this arena is recognised as a conduit for raising standards of business practice. Martinez's paper can be seen as offering a new way of conceptualising the business-society relationship, and of reconciling economic, social, and environmental imperatives.

Lez Rayman-BacchusGuest Editor