Managing the Business Case for Sustainability The Integration of Social, Environmental and Economic Performance

The difficulties in moving towards corporate sustainability raise the question of how environmental and social management can be integrated better with economic business goals. Over the last decade, the relationship between environmental and economic performance, and more recently the interaction between sustainability performance and business competitiveness, have received considerable attention in both theory and practice. However, to date, only partial aspects of the relationship between sustainability performance, competitiveness and economic performance have been studied from a theoretical as well as an empirical perspective. And, to date, no unique relationship has prevailed in empirical studies. A number of explanations have been put forward to explain this, including methodological reasons, such as the lack of statistical data, the low quality of that data, or the fact that such data is often available for short time periods only. Other theoretical explanations have been developed, such as the influence of different corporate strategies or the relatively small influence of environmental or sustainability issues as one factor among many on the economic or financial success of firms. So, how should the business case for sustainability be managed? This is the starting point for this book, which compiles insights on a large number of aspects of the link between sustainability performance, business competitiveness and economic success in an attempt to provide a comprehensive and structured view of this relationship. The book provides an unrivalled body of knowledge on the state of theory and practice in this field and identifies prospective future fields of work. The book includes: conceptual frameworks for the interaction of social, environmental and economic issues in business environments; case studies of companies that have successfully integrated social, environmental and economic issues; analyses of the causal and empirical relationship between environmental and/or social performance, business performance and firm-level competitiveness; concepts and tools useful for improving business value with proactive operational strategies; assessment of the factors influencing operational sustainability strategies and their economic impact; and comparisons of interactions between sustainability performance and firm competitiveness across industry sectors and countries. Managing the Business Case for Sustainability is the definitive work in its field: the most comprehensive book yet published on the theory and practice of managing sustainability performance, competitiveness, environmental, social and economic performance in an integrated way. It will be essential reading for managers, academics, consultants, fund managers, governments and government agencies, NGOs and international bodies who need a broad and comprehensive overview of the business case for sustainability.

Foreword John Elkington, Founder and Chief Entrepreneur, SustainAbility Foreword Peter Forstmoser, CEO, Swiss Re Introduction. Managing and Measuring the Business Case for Sustainability. Capturing the Relationship between Sustainability Performance, Business Competitiveness and Economic Performance Stefan Schaltegger, Centre for Sustainability Management, University of Lüneburg, Germany, and Marcus Wagner, Dr Theo Schöller Chair in Technology and Innovation Management, Technische Universität München and Centre for Sustainability Management, Universi Part 1. Theory – conceptual approaches 1. The link between environmental and economic performance Environmental and Economic Performance: The Basic Links Leena Lankoski, Helsinki University, Finland How Can Environmental Management Contribute to Shareholder Value? The Environmental Shareholder Value Approach Stefan Schaltegger, Centre for Sustainability Management, University of Lüneburg, Germany 2. Social performance and economic success Do Social Objectives Integrate with Core Corporate Objectives? The Future of Social Auditing Trevor Goddard, Curtin University of Technology, Australia Social Performance and Competitiveness: A Socio-Competitive Framework Kuno Spirig, Zurich University of Applied Sciences, Winterthur, Switzerland 3. Integrative approaches Mapping the Links of Corporate Sustainability: Sustainability Balanced Scorecards as a Tool for Sustainability Performance Measurement and Management Marcus Wagner, Dr Theo Schöller Chair in Technology and Innovation Management, Technische Universität München and Centre for Sustainability Management, University of Lüneburg, Germany, and Stefan Schaltegger, Centre for Sustainability Management, Universi A Model of Financial Analysis at the Service of Sustainability Juan Piñeiro Chousa and Noelia Romero Castro, Department of Finance and Accounting, University of Santiago de Compostela, Spain Sustainable Value Added: A New Approach to Measuring Corporate Sustainable Performance Frank Figge, School of the Environment, University of Leeds, UK, and Tobias Hahn, Institute for Futures Studies and Technology Assessment, IZT, Germany Sustainable Analysis of Industrial Operations: A Proof of Concept Demonstration Study Sonja Lynn Odom, Laboratory for Sustainable Solutions, Department of Mechanical Engineering, University of South Carolina, USA Part II. Empirical surveys – financial markets; industry and country surveys 4. Views from the financial markets The Economic Performance of European Stock Corporations: Does Sustainability Matter? Klaus Rennings, Michael Schröder and Andreas Ziegler, Centre for European Economic Research (ZEW), Germany Capital Markets and Corporate Environmental Performance: Research in the United States Dinah A. Koehler, Economics and Decision Sciences Research, National Center for Environmental Research, US Environmental Protection Agency, USA Sustainable Investment and Financial Performance: Does Sustainability Compromise the Financial Performance of Companies and Investment Funds? Eckhard Plinke and Andreas Knörzer, Sarasin Sustainability Investments, Bank Sarasin & Co. Ltd, Basel, Switzerland Benchmarking Competitiveness and Management Quality with the Dow Jones Sustainability Index: The Case of the Automotive Industry and Climate Change Niki Rosinski, Sustainable Asset Management (SAM), Zurich, Switzerland 5. Industry surveys Have Trends in Corporate Environmental Management Influenced Companies' Competitiveness? Henning Madsen and John P. Ulhøi, The Aarhus School of Business, Denmark Competitiveness, Environmental Performance and Management of SMEs David Hitchens, Queen's University Belfast, UK, Jens Clausen, IÖW, Germany, Mary Trainor, Queen's University Belfast, UK, Michael Keil, IÖW, Germany, and Samarthia Thankappan, Cardiff University, UK IPPC and the Impact of Best Available Techniques (BAT) on the Competitiveness of European Industry: Survey of the European Non-Ferrous Metals Industry David Hitchens, School of Management and Economics, Queen's University Belfast, Northern Ireland, Frank Farrell, Environment Agency, Bristol, UK, Josefina Lindblom, Institute for Prospective Technological Studies (IPTS), Seville, Spain, and Ursula Triebsw 6. Country surveys The Mutual Relationship between the Environmental Context and Management in the Netherlands Ronald S. Batenburg, Department of Information Sciences, Utrecht University, the Netherlands The Norwegian Environmental Business Barometer Bjarne E. Ytterhus, Norwegian School of Management (BI), Sandvika, Norway Sustainability Performance of Countries: Based on the Example of Oekom Research AG's Country Rating Matthias Bönning, Oekom Research, Munich, Germany Does a Nation's Ecological Performance Affect its Economic Stability? The Potential for Enhancing Sovereign Credit Risk Assessments with Ecological Resource Accounts Mathis Wackernagel, Global Footprint Network, Oakland, CA, USA, Chris Martiniak, Global Footprint Network, Oakland, CA, USA, and University of Michigan Business School, USA, Fred Wellington, World Resources Institute, Sustainable Enterprise Program, andformerly Environmental Management Program, University of San Francisco, USA, Chad Monfreda, Sustainability and Global Environment Program, University of Wisconsin, Madison, USA, and Steve Goldfinger, Justin Kitzes and Deborah Cheng, Global Footprint Network, Oakland, CA, USA, Part III. Evidence – strategies, case studies and management systems 7. Strategies and the business case for sustainability Achieving Sustainable Corporate Competitiveness: Strategic Link between Top Management's (Green) Commitment and Corporate Environmental Strategy Ki-Hoon Lee, KwangWoon University, Korea, and Robert Ball, University of Stirling, UK Ecopreneurship and Competitive Strategies: Striving for Market Leadership by Promoting Sustainability Holger Petersen, Umweltbank Nürnberg and Centre for Sustainability Management, University of Lüneburg, Germany Building a Business Case for Corporate Sustainability Ulrich Steger, Institute for Management Development (IMD), Lausanne, Switzerland Developing Value: The Business Case for Sustainability in Emerging Markets Jodie Thorpe and Kavita Prakash-Mani, SustainAbility, UK 8. Company cases Managing Sustainability Performance in the Textile Chain Stefan Seuring and Maria Goldbach, Supply Chain Management Centre, Carl von Ossietzky Universität Oldenburg, Germany Sustainability and Competitiveness in the Renewable Energy Sector: The Case of Vestas Wind Systems Rolf Wüstenhagen, Institute for Economy and the Environment, Switzerland Path-Dependent Thinking and Ecoproducts: An Empirical Study of Socio-Cognitive Models and Product Propositions of Ford and Volvo Cars Mats Williander, Fenix Centre for Research on Knowledge and Business Creation, Chalmers University of Technology, Sweden Honda and Toyota: Using Sustainability in a New Competitive Battleground Peter A. Stanwick and Sarah D. Stanwick, Department of Management and School of Accountancy, College of Business, Auburn University, USA Incremental Change towards Sustainanbility: Integrating Human and Ecological Factors for Efficiency Suzanne Benn, School of Management, University of Technology, Sydney, Australia, and E. Jane Probert, European Business Management School, University of Wales Swansea, Swansea, UK 9. Environmental management systems and competitiveness ISO 14001: Profitable? Yes! But is it eco-effective? Jost Hamschmidt and Thomas Dyllick, University of St Gallen, Switzerland What Makes Environmental Management Systems Successful? An Empirical Study in the German Manufacturing Sector Boris Braun, Department of Geography, Otto-Friedrich-University, Bamberg, Germany