Study proposes strategies to manage Corporate Sustainability

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The research highlights three types of common trade-offs in organizational sustainability decisions: choice of objectives, timeframes and stakeholders.

Managing sustainability is a challenge for companies, especially when there are conflicts between the economic, social and environmental pillars. In the article published in the GV-Executovo magazine, José Guilherme Ferraz de Campos, PhD in Administration and professor at the Higher School of Engineering and Management (ESEG), discusses the trade-offs in relation to corporate sustainability and presents strategies to overcome the inconsistencies of the sustainability tripod.

Trade-offs in corporate sustainability are situations in which, in order to gain in one dimension, others are harmed. The text highlights three types of common trade-offs in organizational sustainability decisions: choice of objectives, periods and stakeholders. The first type involves prioritizing economic objectives over others, the second refers to the choice between immediate or future results, and the third type concerns the difficulty in managing relationships with various stakeholders and maintaining social legitimacy.

According to the author, to overcome these inconsistencies in the sustainability tripod, it is necessary to adopt an integrative perspective, taking into account vp quality email database social, environmental and economic aspects simultaneously, even when there are contradictions between them. Companies generally prioritize the economic aspect, but observing impact business organizations or hybrid organizations can help to understand how companies can accommodate these trade-offs.

These organizations have sustainable business models and consider socio-environmental impact as an inherent part of their nature and operation. To understand the strategies that hybrid organizations use to accommodate trade-offs in relation to sustainability, a qualitative research was conducted with multiple case studies of ten micro, small and medium-sized hybrid organizations in the agri-food and fashion and textile sectors, classified as impact businesses or companies with sustainable business models.

Data were collected through interviews with the managing partners or senior managers of the companies and analysis of internal and public documents released by the organizations. The analytical progression framework was used to identify situations in which companies faced decisions involving sustainability trade-offs and to generate conclusions based on the analysis of the companies' individual actions until arriving at the approaches used.

Companies use five approaches to address sustainability trade-offs: offsetting, prioritizing, differentiating, redirecting, and subsidizing. Each of these approaches involves making decisions about trade-offs among different dimensions of sustainability. Strategies can be combined, and some strategies can be applied only to specific products, processes, or markets. Companies typically take a situational perspective, applying strategies to accommodate specific trade-offs rather than a company-wide strategy.