Board and Top Management Social Sustainability Work in Cluster Organizations

Abstract

This case study aims to analyze how boards and top management in regional cluster organizations contribute to social sustainability commitment for themselves and their member organizations with specific focus on gender equality and diversity issues. The study adopts a case study research approach, where interviews, observations and secondary data constitute the basis for in-depth analysis. To deepen the case analysis, four theoretical perspectives are applied for pattern-matching: stakeholder, resource dependence, agency and institutional theory. Results of the study show that the boards are aware of stakeholder requirements, have necessary resources and expertise, and are well aware of the importance of social sustainability, but they act traditionally by focusing on economic incentives and responsibility. Board members act symbolically by transferring social responsibility to the top management of these cluster organizations through their applications for funds. From agency and stakeholder perspectives, the fund application regulates roles and responsibilities between the parties. Top management legitimates the responsibility by initiating projects and initiatives to strengthen social sustainability in a substantive way in member organizations. The study contribution shows that the board’s mission and role have symbolic significance for building social responsibility, while top management contributes substantively.

Investigating the influence of total productive maintenance key success factors on the social sustainability dimension of manufacturing SMEs

“…Top management commitment plays an important role in nurture a practice like TPM and leading the firm toward social sustainability. These findings confirm the past research of Kiesnere and Baumgartner (2020), Sundström and Mickelsson (2020), Henry et al. (2018, p. 180), Kiron et al.…”

“…Their findings suggest that top management helps to promote the sustainable development of companies. Sundström and Mickelsson (2020) indicate that top management is important in achieving social sustainability of firms. Staniškienė and Stankevičiūtė (2018) suggested that employee involvement and effective communication lead to a firm towards social sustainability.…”

The Social Dimension of Corporate Sustainability: Review of an Evolving Research Field

“…Shareholders and their interests are recognized as part of the stakeholder community [62,66], yet shareholder value as an explicit theoretical approach is not apparent. The resource-based view focuses further on the resources companies' need to operate and how these can be obtained or built [67,68]. Tate & Bals [66] most prominently use it to develop a social resource-based view, equivalent to the already established natural resource-based view.…”

“…This is closely connected to legitimacy theory, which emphasizes the embeddedness of corporations into social systems, creating a need to obtain social approval to do business. The need for legitimacy is referenced to both individual stakeholders as well as society in general [67,68]. Labuschagne et al [25] utilize capital stock theory, framing CSS as a company's contribution to various forms of social capital, e.g., human, productive and community capital.…”

“…Turker & Ozdemir [70] draw on systems theory to address the complex, reciprocal and non-linear relationships of corporations with their social environment. Further theoretical frameworks mentioned are transaction cost economics [71], agency [68] as well as contingency theory [72]. Four papers provide a multi-theory approach by combining stakeholder theory with one or more other frameworks.…”