[We’re pleased to welcome authors Minna Halme of Aalto University School of Business, Jukka Rintamäki of City University of London, Jette Steen Knudsen of Tufts University, Leena Lankoski of Aalto University School of Business, and Mika Kuisma of Aalto University School of Business. They recently published an article in Business & Society entitled “When Is There a Sustainability Case for CSR? Pathways to Environmental and Social Performance Improvements,” which is currently free to read for a limited time. Below, Dr. Miklian reflects on the impact and innovations of this research:]
What motivated you to pursue this research?
While this article focuses on sustainability performance, it is based on a joint research project of 12 universities which originally set out to study societal impacts of CSR. We were motivated by the fact that there is so little research on societal impacts CSR, and so much need for it among policy makers and non-governmental organizations.
What has been the most challenging aspect of conducting your research? Were there any surprising findings?
The difficulty of getting data on impacts of companies’ CSR activities took us by surprise. We had chosen a sample of companies that – based on publicly available ratings – were either leading or good CSR performers, but data on societal impacts of CSR was still scarce. And not only scarce: CSR practices, performance and impacts were often also confused with one another in the company reporting and in managers’ oral accounts. It took massive cross-checking of interview data, and public and internal document data to get the study done.
It also became strikingly evident that in the end of the day researchers as well as sustainability ratings are at the mercy of companies’ self-reported sustainability data. Databases and ratings such as the KDL, Asset4 or the like tend to be viewed as reliable data. Investors and management academics measuring corporate sustainability performance widely use these ratings as if they were drawn from “hard objective data”. In reality such data is self-reported by companies.
Aggravating the risk of mismeasurement is that these schemes are untransparent: users (researchers, investors) do not necessarily know what data exactly composes each indicator. This is paradoxical as for research purposes it is considered positive if “the performance data is from an external source” – a statement which effectively closes the door from discussion about validity problems of performance data used. Sustainability databases should make their performance measurement data more transparent so that users have a means to assess what has been measured as environmental and social performance.
In what ways is your research innovative, and how do you think it will impact the field?
We separated CSR activities (antecedents of sustainability performance) from the performance itself, and did not rely on narrow data but instead constructed performance schemes for assessing both environmental and social performance. In addition to management researchers, our team had wide sustainability performance knowledge base from natural science to social sustainability studies. We used both externally available and internal document data, interviewed companies as well as met with their stakeholders to complement and verify the data. In other words, we went beyond analysts adhering to data sets like KDL, Asset4 or TRI.
Our configurational approach makes it possible to discover that different pathways are associated with environmental and social performance (non)improvements, and that pathways to success and failure are for the most part not symmetrical, which has not been shown before with any larger dataset.
We expect that our research will encourage more informative future research on the influence of CSR policies and practices onto sustainability performance. We hope it raises the bar for more comprehensive future measurement of sustainability performance of companies, making the research in the field more useful for policy makers who seek to steer corporate performance and for company managers, who struggle to understand what kind of CSR is beneficial for improvement of sustainability performance.
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