Social acceptance or profit from Sustainability management

In 2011, PHYS.ORG held that almost three-quarters of Standard & Poor’s top 500 US companies mentioned one or more sustainability programs on their websites.
And from the newly defined Sustainability being the endurance of systems and . . . .

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In 2011, PHYS.ORG held that almost three-quarters of Standard & Poor’s top 500 US companies mentioned one or more sustainability programs on their websites.

And from the newly defined Sustainability being the endurance of systems and processes, a new study then showed that the largest companies were doing so only for marketing and maintaining a profitable customer base rather than to actually incorporate and promote sustainability.

This article below was published by PHYS.ORG  on 25 February 2016 .  We reproduce few excerpts here for all intents and purposes of sustaining all efforts towards the good undertaking of serious sustainability not only throughout the MENA region but throughout the world as well.

Sustainability management: social acceptance more important than profit  

It is commonly believed that companies are only committed to environmental and social issues if this contributes to increase their profits.  A new study now shows that this stereotype is not true at least for large companies in developed countries.  The driving force behind sustainability management activities of large companies is mainly the pursuit of social acceptance.  Conversely, profit maximisation plays a subordinate role.  This counterintuitive result of a broad empirical study has recently been published in the Journal of Business Ethics by Prof. Dr. Stefan Schaltegger (Leuphana University of Lüneburg) and Prof. Dr. Jacob Hörisch (Alanus University).

The study is based on a survey of 432 of the largest companies in ten industrial countries in Europe, North America and Asia.  Sustainability managers were asked about the aims, actors, methods and effects of the company’s sustainability management activities.  The survey results are clear: A legitimacy-oriented perspective is prevalent not only in the aims, but also in the organisational implementation and the application of sustainability management measures.  By contrast, objectives and practices following a more profit-driven logic of action were regarded as less important by the majority of respondents.

Already for developing sustainability management goals, the pursuit of social recognition plays a greater role than the profit motive.  This may be because the impact from legitimacy-oriented players such as media or NGOs on corporate sustainability activities is perceived to be much higher, than that of financially focussed external stakeholders such as banks, credit rating agencies or shareholders.

A similar picture emerges from the choice of sustainability activities.  For the majority of businesses, legitimacy-driven measures, such as improving employee motivation and the reputation of the company are more important than profit maximisation and cost reduction.

Sustainability

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