Companies simultaneously strive for economically profitable activity and for solutions that are sustainable both for society and for the environment. This inevitably leads to cross-pressures. Companies need to choose what societal or environmental challenges they will grasp and with what intensity. Setting priorities is challenging, especially in an operating environment that is constantly changing. However, responsibility is an essential condition for business, which must guide strategy. The tensions offer possibilities for renewal.
Today's successful innovations must also be responsible ones. This should encourage companies to look for business opportunities, which consider responsibility. Such opportunities may arise from developing business activities, or even by offering a business a completely new direction. This means for example implementing new models of action or production, or launching new products or service packages. Identifying emerging conflicts and tensions helps turn them into potential sources of innovation.
In organisations, tensions describe incompatibility or conflicts in states of affairs, values, goals, structures, hopes, and action models of different types1 . These tensions can relate to, for example, participation, identity and competing values, renewal and the preservation of what is old, balance between cooperation and guidance, or the demands of different stakeholders2 .
Large companies and tensions of responsibility
We interviewed 14 representatives of large Finnish companies on how work to promote corporate responsibility is currently carried out and what kinds of tensions are connected to it. The interviews revealed many tensions that affect important activities of the organisation, and which are also linked with each other:
- Mental image – Authenticity. Mental images can help inspire and to attempt to exert influence, but caution is needed when in public. It is important for real development and genuine action to exist behind the mental images.
- Capable – Submissive. The development of responsibility is invariably connected with broad issues that are very difficult to alter or manage. However, forward-looking action makes it possible to develop, and to attain an advantageous position. It is difficult to reconcile the idea of trying to turn activities in a more responsible direction in a quarterly economy, if the future concrete benefits remain unknown, and if they cannot be measured.
- Solitary – Internalised. Responsibility must be melded into all activities, but to be sufficiently consequential, it must also be examined separately.
- Required – Participatory. Stringent requirements (standards, minimums, risk categories, reports, etc.), and audits are needed, but also flexible cooperation to identify local practices and small players and to take them into account.
- Extensive – Deep skills. An extensive thorough vision of responsibility is needed, as well as detailed information and understanding in the right context, for customers, as well as employees, and the supply chain.
- Creating new things – Traditional. In addition to active innovation and renewal, we need to manage both transition and change fatigue, and to preserve the focus and confidence in models of activity that ensure continuity. Even a traditional product or service can be sustainable, which might also put a damper on enthusiasm for development.
- Coil – Indicated. It is essential to measure different kinds of things to increase awareness and transparency and to know the direction, but comparisons are difficult to make because of differing scales.
Identifying tensions promotes responsibility
Understanding and knowing these tensions promote the development of responsible business activities. There are no simple solutions, but open dialogue helps turn tensions into opportunities. Will we use easy gauges to bring the right things forward or will we bury something that is more difficult to measure, but still important (e.g., biodiversity) underneath them? Will we see our sustainable products and services to be so outstanding that we will no longer seek new ways to deepen responsibility? Will we shift our responsibility onto our customers and their buying behaviour instead of offering a sufficiently understandable service or product? Will we yield in the procurement process, or will we seek to actively increase understanding?
In interviews with companies, responsibility was seen as an important starting point for strategy and a prerequisite for business, because without responsibility there is no business activity. The tensions between the different areas of responsibility - economic, social, and environmental responsibility - did not stand out. Some companies that are pioneers in responsibility saw that large businesses have a clear mission in debate on the directions that the development of society should take, and in the creation of operating environments that enable responsibility, for subcontractors, for example.
“...there are no innovations if they are not also responsible”, is how one of the interviewees summed things up. This is an excellent starting point for future development in Finnish companies, which supports Finland's efforts to attain a global pole position in a green and responsible economy. Responsibility thinking is constantly moving forward, which requires companies to stay awake and to take an active approach. Tensions might seem disturbing, but at best, they challenge our thinking and feed the search for new solutions and for innovation.
1 Nieminen, M., Talja, H., Heikkilä, J-P., Airola, M., Viitanen, K., & Tuovinen, J. (2017). Change flexibility: Support for an organisation’s resilience. VTT Technical Research Centre of Finland. VTT Technology No. 318
2 Hahn, T., Figge, F., Pinkse, J., & Preuss, L. (2018). A paradox perspective on corporate sustainability: Descriptive, instrumental, and normative aspects. Journal of Business Ethics, 148(2), 235-248.