The Development of Sustainability Leadership Framework
Generating a shift in people’s consciousness requires a “Sustainability revolution” (Edwards, 2005). To develop the strategic imperative of the new millennium, hence we have to emphasize on the excellence, quality, and reengineering movements of the late 20th century. Regarding sustainability issues, substantial public interests are fueling on corporate focus. For example, it requires changes in legislation, pressure from stakeholders, and reluctant managers to take into account on sustainability issues.
Sustainability initiatives should be considered by companies due to several reasons. Sustainability can be adopted as branding strategies, image strategies, cut cost endeavors, differentiate themselves from competitors, and firms’ value statements. Morsing and Oswald (2009), for example, argued that a healthcare company, namely Novo Nordisk integrates a commitment in their business conduct as one of their corporate values. On the other hand, the firms’ management training and the firms’ balanced scorecard measures are other examples of company’s values that can be regarded as sustainability initiatives (Harget & Williams, 2009). Furthermore, Bonini et al. (2009) stressed that a social responsibility dashboard is another example of sustainability initiatives that can be classified as a company’s values.
There is still a gap with regard to the development of a comprehensive firm’s sustainability model from its inception to implementation. As management teams normally unable to connect sustainability to business strategy, Porter and Kramer (2006) asserted that sustainability efforts are not productive as desired. Since the 1980s, the number of related studies regarding sustainability has increased dramatically (Turker, 2009). Unfortunately, its importance is not being taken into account in many organizations. Morsing and Oswald (2009), for example, found that ‘‘the literature on sustainability and corporate social responsibility has not paid much attention so far to how leaders enact a corporate sustainability strategy among organizational members’’ (p. 83). Figure 1 shows the Sustainability Leadership Model.
Due to a lack of a comprehensive firm’s sustainability model, I would like to address a comprehensive model of employee engagement as described by Whittington and Galpin (2010). Figure 1 and Figure 2 shows the Sustainability Leadership Model, which generates a fundamental of successful sustainability efforts starting from the formulation, implementation and execution.
The engagement of workforce is an important element in the Sustainability Leadership Model. Transforming a firm’s sustainability mission, strategy, and values can be done through workforce engagement. Commitment is one of important issues that need to be taken into account when discussing about workforce engagement (Lacy et al., 2009). To enhance productivity, revenue and customer satisfaction, so a firm can adopt a firm’s leadership and performance about sustainability in order to motivate their employees beyond the firm’s expectation. Lacy et al. (2009) stressed that ‘‘when employees are engaged with their company’s sustainability strategy, they proactively identify, communicate and pursue opportunities to execute the strategy’’ (p. 491).
An indicator of the firm’s commitment related to the sustainability strategy is included in a firm’s mission statement (Castello & Lozano, 2009). The risk management perspective, namely intermittent sustainability activity and undeveloped sustainability programs is the first stage of commitment to sustainability. The function of sustainability at this stage is used to protect the firm’s reputation. The integrated stage is the second stage of sustainability development, which is adopted by consisting both social and environmental responsibilities in the model.
In order to gain competitive stage, a firm will reflects on the management of social and environmental issues. Even though the firm’s communications is classified as one of the development of organizational sustainability, but it is still being excluded in its mission. The citizenship stage is regarded as the third stage of organizational sustainability. Senior leadership’s openness normally in included in the citizenship stage is characterized by combining social issues into the firm’s responsibilities.
Researchers (e. g. Logsdon & Wood, 2002; Mirvis & Googins, 2006) stressed that a firm’s business model should assume the role of social issues in order to implement a transformation process. This means that the refinement of the company’s mission is required in the citizenship stage, especially when dealing with the sustainability issues. Figure 1 depicts the macro-level components of Sustainability Leadership Framework. Sustainability and strategy A firm is having a difficulty in linking the firm’s sustainability efforts to its business strategy, even it is important to do something as soon as possible.
Sustainability issue is important to business strategy. Porter and Kramer (2006) stressed that an integration of sustainability into business strategy can help to generate long-term value to both firm and society as it can help the firm to get a great competitive benefit. Sustainability and ? rm values Beliefs about standards of behavior that organizational members should cultivate in order to achieve organizational goals are recognized as organizational values. Morsing and Oswald (2009) argued that organizational values can assist organizational members to develop their motivation, commitment and loyalty.
Despite of that, aligning employees with a firm’s sustainability efforts requires shared values among employees (Hargett & Williams, 2009). In other words, Morsing and Oswald (2009) asserted that each manager is required to do the right thing in each situation around the world by cultivating the specified organizational values. A firm’s core values should embed sustainability in developing the firm’s sustainability agenda (Hargett & Williams, 2009). Rok (2009) argued that the determination of the total sustainability motivation is important in generating the firm’s values.
The HR value chain: setting the context for workforce engagement Despite of the development of a firm’s sustainability strategy, the development of management’s approach to human capital should be taken into account as well. Several researchers (e. g. Porter & Kramer, 2006; Lacy et al. , 2009) argued that the linkage of firms’ sustainability efforts to their human capital practices is not being emphasized as intended, for example, several firms are still not engaging their workforce in their sustainability efforts.
A framework for the connection between a ? m’s strategy and its human capital practices is generated by the HR value chain. An integration set of human resource management practices is able to engage people in a committed pursuit of a chosen strategy and a set of core values. Finding and hiring people is the first stage of the company’s sustainability strategy and values to fit the required strategy and stated values. Researchers (e. g. , Backhaus et al. , 2002; Bhattacharya et al. , 2008) showed that an employer has attracted to the link between a firm’s sustainability.
The stage of HR value chain, which consisting of the link between the firm’s sustainability strategy and its employees require incentive pay, information sharing, empowerment, and skill development (Pfeffer, 2005). It is known as a continuous reinforcement process of hiring new employees to fit both organization’s sustainability strategy and values. In addition, the final dimension of the HR value chain requires the handling of the separation of an organization’s employees. This stage shows the firm’s commitment in using procedures to show its respect to the required employees.
If the separation of both the individual and the integrity of organization being handled, then the employees should have a feeling of fairness regarding this issue. This process can cultivate a sense of commitment and engagement towards an organization by the remaining employees as they regard the process of separation is being fair. Since the shift of firm’s mission, strategy and values occur continuously, so it evolves along the sustainability stages. It requires a process of check and balance, especially to ensure that the organization’s HR management practices is aligned with the sustainability strategy and values of the firm.
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