Barriers to the execution of sustainability strategies

How successfully do organisations execute sustainability strategies and what are the barriers they meet? This was the focus of a recent exploratory research project, which aimed to gather and analyse the experiences of managers working in fast-moving goods companies (FMCG).

It is generally agreed that for organisations to achieve sustainability, managers must address its different aspects during the strategic decision-making process and incorporate them into their corporate, business and functional level strategies. Middle managers (MMs) are considered to play a key role in an organisation’s strategy execution, and concerns have been expressed that implementation slows as it reaches middle levels.   Researching barriers to implementing sustainability is a potential source of solutions in sustainability implementation. 

This article summarises an exploratory study which conducted interviews with 18 middle managers from 14 companies in the FMCG sector, an area of industry particularly affected by the need for speed of delivery, and increasingly focussed on sustainability implementation. Participating companies were selected to include public sustainability commitments with visible external expressions of this commitment. 

Data was gathered through a series of semi-structured interviews, allowing participants to use their own words to describe experiences.

Three major classes of barriers retained the attention of participants

1.    Corporate leadership and commitment    

Leadership is absent: A minority of participants reported that there was a lack of direct communication concerning sustainability, despite strong external communications. Middle managers’ interpretation was that their own behaviour should follow the internal rather than the external communication, and that sustainability contributions were not expected from them.

Leadership is ambiguous: The key difference between absent and ambiguous leadership is demonstrated by a lack of substantial commitment and guidance towards MMs operationalising sustainability. The great majority reported working in organisations with visible, even visionary, sustainability leadership at senior levels coupled however with strong command-and-control cultures which celebrated economic success. Interestingly this was not interpreted as an opportunity for MM leadership. 

Leadership is consistent: A minority of interviewees reported that sustainability leadership was consistent with the context of the entire company and that sustainability was a key factor of company success. Business model and leadership model were seen as aligned, and   sustainability was seen as having been embedded in the culture. Additionally, sustainability was considered consistent with their distributed leadership model, with clear strategic guidance given. 

2.    Top-down strategic direction, cascaded objectives, KPIs and rewards

Sustainability objectives within the formal management system are absent: This group was unaware of any formal personal sustainability objectives linked to a strategic sustainability goal, while all reported that they themselves received business and individual objectives, linked partially to rewards. Absent personal sustainability objectives were viewed as meaning no contribution was expected. 

Sustainability objectives are inconsistent or incomplete: The second group reported the existence of group-wide sustainability objectives or initiatives but perceived them as a barrier due to their incompleteness. Other interviewees drew attention to the conflict they perceived behind having both 'sustainable' and 'non-sustainable' products in the same company, leading to questions on company purpose consistency.  

Formal distributed sustainability approaches with delegation of responsibility, objectives, KPIs or rewards are present and consistent:  In contrast, the third group of participants reported high-level guidelines for integrating sustainability within a management system that emphasised strategic degrees of freedom of decentralised units, measured with a balanced set of KPIs incorporated into performance measurement and reward systems.

3.    Sense of agency and willingness to take initiative

Levels of initiative are absent or low: The majority of all participants reported that there was little that they could initiate personally. Lack of agency was firstly associated with lack of senior guidance, secondly, with the perception of low expectations by top management. No interviewee in this group was able to cite an example of personal initiative.

Initiatives are selective: A second, more restricted group reported a degree of initiative through the assumption of responsibility for high-level corporate initiatives at a local level and their adaptation them to local context in order to facilitate successful implementation. However, this initiative-taking was often related to making group initiatives palatable to local sensitivities (e.g. LGBT initiatives). Equally, a lack of implementation support, reinforced the dominant negative local narrative concerning HQ initiatives in general. No local, independent examples of sustainability initiatives were cited by interviewees in Group 2.

Initiative-taking is consistent and widespread: A restricted third group of participants described and demonstrated high levels of initiative. Rather than assuming that strategic issues were the responsibility of senior management, MM focus was shifted to 'white spots', i.e. areas where only MM could perceive the need to solve 'new and urgent' business and sustainability problems. This led to examples of significant strategic initiatives which emerged from the changed perceptions of MM, for example, investing time heavily in collaboration within their local ecosystem to change industry standards and establish a culture of sustainable business. 

Conclusions

The results obtained from this exploratory research into barriers to sustainability strategy execution suggest the need for practitioners to examine potential barriers before designing their implementation plan. Incorporating those responsible for execution into the process and recognising the potential impact of existing formal and informal systems, such as planning and rewards or leadership style and performance culture appear to be essential 'good practice' elements.

Literature

Barriers to implementing sustainability experienced by middle managers in the fast-moving consumer goods and retail sector, Mountfield, A., Hrainoha, K., Koh, L., Lascenko, L., Puchula, R. & Schalch, C., in Research Handbook of Sustainability Agency, Teerikangas, S. et al. (2021), Edward Elgar Publishing, Cheltenham, UK