Examining The Business Impact Of Owner Commitment To Sustainability

The Concept of Sustainability

In view of the recent competitive landscape, sustainability is a challenging issue. The businesspersons are concerned about how to prosper in terms of effective utilization of the resources without compromising the needs of the future generation. Annual reports of the companies and organizations reflect incorporation of sustainability in the marketing operations. Within this, the focus is on maintaining the balance between economic growth and social welfare. Global crisis makes the viability of the stakeholder value obsolete (Gareis et al., 2013). According to the arguments of Silvius, Köhler and Brink, (2011), with the rise in the “inconvenient truth”, there was simultaneous transformations in the mind-set of the employees. This is in terms of consumer behaviour and corporate policies, which necessitated the need for effective monitoring techniques for completing the projects within the stipulated time.  This assignment attempt to develop a journal on the role of sustainability on the effective management of the projects.

According to the arguments of World Commission on Environment and Development (1987), sustainability is the defined as “fulfilling the needs of the present generation without compromising the capability of the future generation towards making effective and judicious use of the resources. For this, balance is essential within the ecosystem, especially in the carbon footprints (Silvius, Köhler & Brink, 2011). Typical evidence of this lies in the greener marketing, which most of the OECD countries have adopted for contributing to the preservation of biodiversity. Example can be cited of the underdeveloped countries, sustainable development is equated with increasing the material costs of living.

As per the arguments of United Nations World Commission on Environment and Development, the aim of sustainable development is the promotion of harmony through conglomeration of human beings, humanity and nature. International Institute for Sustainable Development (2010) focuses the sustainable development within the organizations. As per the arguments of Gregersen, Lundgren and White, (1994), emphasis has been given on the development of strategies, which help in catering to the needs, demands and requirements of the stakeholders within compromising the needs of the future generation. Within this, the mentality towards attaining profitability is reflected, which cannot be achieved until and unless caring approach is exposed towards humanity and environment. Mention can be made of Triple Bottom Line, a concept used by John Elkington in his book, Cannibals with Folks: The Triple Bottom Line of 21^st Century Business. The term referred to the consideration of triple P’s, that is, people, planet and profit (Silvius, Köhler & Brink, 2011). According to this concept, key elements of sustainability is identified as:

• Integration of economic, environmental and social parameters
• Conglomeration of short and long terms goals for preserving the ecological biodiversity
• Consumption of the income instead of the capital

Sustainability and Project Management

From the triple bottom line concept, the three pillars of sustainability are Social, Environmental and Economic. All of these are complimentary to each other and have adverse impact on the society as a whole (Silvius & Schipper, 2014).

Figure 1: Three pillars of sustainability

(Source: Silvius et al., 2012)

Governmental interference helps the companies and organizations to maintain the socio-economic boundaries. This is in terms of measuring the feasibility of the activities in terms of social wellbeing. This is through the provision of subsidies, taxes and financial aids and support. Investments in public interests enables in achieving infrastructural development. The major drive behind this is partnership with research and development team for the introduction of sustainable resources. Along with this, Sánchez, (2015) is of the view that training programs assist in making the employees aware of the ways and means in which the resources can be sustained for the future generations.

In terms of the competitive ambience of the market, the companies and organizations are concerned about the inappropriateness of the business practices. This inappropriateness indicates the negative outcomes, which can adversely affect the productivity. Typical evidence of this is the exploitation of the resources, leading to inadequacies, compelling the personnel to submit incomplete projects to the clients. Labuschagne, Brent & Erck, (2005) opines that this approach has disrupted the stability in professional relationships. In some circumstances, most of the companies and organizations indulged in projects like new production plant, launching of new products, business practices or resource. These initiatives yielded positive results, however, for attaining sustainable development, the society was in need of more strong and flexible projects. Moreover, Beheiry, Chong & Haas, (2006) argues that the initiatives reflect the connection between sustainability and project management, which was established by World Commission on Environment and Development. Two decades later, when the standards of the project were investigated, it was found that most of the companies and organizations failed to satisfy the criteria of the sustainability agenda.

As the components of sustainability are interrelated with each other, achieving an understanding is difficult. Moreover, the concepts are conceptual rather than practical, which necessitates the need for applying theoretical knowledge and skills towards management of the projects. Intuition regarding project management is contradicts the implicit expression of the terms related to the project management (Martens & Carvalho, 2016). Scarcity in literature reflects incompleteness within the aspects of project management. This scarcity creates fissures within the knowledge and skills of the personnel regarding attaining sustainable development through effective management of the products.

Approaches to Sustainable Supply Chain Management and Environmental Sustainability

The scholars are divided on the opinions regarding studies and research on the impact of sustainability on project management. In case of Association for Project Management, attention of the readers is grabbed towards adopting the changes through the implementation of change management theories and models like Kotter’s eight step change management model; Lewis’ change management model among others (Silvius & Schipper, 2014). This application alters the content or the context of business operations. As a matter of specification, focus is on the parameters, which defines and shapes the projects. However, it is striking that the Association provides limited knowledge on the implications, which sustainability have on the processes of managing the projects. This limitations adds ambiguity into the skills, competencies and abilities of the managers towards controlling the projects.  

According to Marcelino-Sádaba, González-Jaen and Pérez-Ezcurdia, (2015), there have been adequate research on the implications of sustainability on project management. Emphasis is on the changes, which the companies and organizations require for enhancing the productivity. Here, the limitations appear in the form of lacunas regarding the type of projects, which are essential for attaining sustainable development. This drawback is striking in terms of estimating the accurate changes, which needs to be implemented within the management process. In this context, the theoretical knowledge is appropriate in terms of gaining an insight into the possible solutions, which can be availed. Dixon, Scura, Carpenter and Sherman, (2013) proposes that maintaining consistency in this process is assistance in terms of reaching to the appropriate solution.

The concept of triple bottom line is related with sustainability. Conglomeration of people and planet reflects the shares into which the resources are segmented. Based on the shares, the future estimations are conducted regarding the availability of the resources and the extent to which the population would increase. For this, the companies and organizations adopted performance management systems tracking the current strategic position. In this, project management was conducted through triple variables-time, cost and quality for enhancing the profit margin (Martens & Carvalho, 2017). This approach adds negative shade to the parameters of social and environmental.

For gaining knowledge about the future prospect of sustainability, understanding towards the full life cycle of the project is crucial. Typical components of the full life cycle are: initiation, development, execution, testing and launching. Aarseth et al. (2017) is of the view that undertaking the projects results in alteration of the systems, assets and behaviour within the workplace. As a matter of specification, different life cycles in this context are asset life cycle, project life cycle and product life cycle.

Corporate Sustainability Assessment, Management Accounting, Control, and Reporting

Figure 2: Interrelating life cycles

(Source: Golini, Kalchschmidt & Landoni, 2015)

The results for a project is a sensitive issue. For example, in the manufacturing sector, assets helps in realizing the value of the products produced. According to the assumptions of other scholars, the results, which is achieved after completion of the project is not always the asset, but it can lead to alteration in the policies and practices. However, results of the projects needs to be considered in terms of assessing whether the current strategic condition would lead to the attainment of sustainable development.

Sustainability on project management can be perceived from the following parameters:

• Project management processes
• Measuring, reporting and governing projects
• Project management competencies (Laszlo & Zhexembayeva, 2017)

A Guide to Project Management Body of Knowledge Guide is crucial in terms of understanding the impact of sustainability on management of the projects. Traditionalism is maintained for explaining the time, cost and quality of resources, which are needed for sustaining the resources. Within this, conglomeration of the social and environmental parameters are conglomerated for assessing the approach of the public towards conserving the resources for the future generation. Moreover, Maas, Schaltegger and Crutzen, (2016) proposes that it also reflects the strategies adopted by the companies and organizations towards adopting greener marketing.

Figure 3: Best areas to integrate sustainable development into project management

(Source: Maier et al., 2016)

The above figure depicts the project management process groups and the percentile for respondents. Closing accounts 50%, which is the highest, followed by initiating, which accounts for 40%. 38% accounts for executing. 32% is devoted to controlling, which reflects lack of planning, adding to the complexities of sustainable development. These complexities attach negative connotation to the consumption of resources.

For initiating the discussion on this subject, the concepts related to sustainability needs to be translated into the indicators, which helps in measuring and assessing the consumption of resources. According to McKinnon and Alston, (2016), attempting this assessment broadens the approaches of the personnel towards effective and judicious utilization of the available resources. One of this indicator is monetary and physical indicators. According to many of the economists, approach of the companies and organizations towards sustainable developments can be translated into monetary consequences. One of the advantages in this context is that in spite of different indicators, the expression is same. According to (), this inverse relationship between difference in indicators and similar expression leads to oversimplification of the real scenario. Countering this, if the scenario and the contexts are simplified, there should not be any exploitation of the resources. However, Formentini and Taticchi, (2016) feels that as effective planning is missing within the business operations, therefore excessive consumption of resources becomes an inevitable issue. In view of these contexts, sustainability attains negative connotation. This is in terms of both the resources as well as capability and approach of the employees to use the resources effectively and judiciously.

Lack of knowledge in many areas adds interrogative parameter to the indicators, which measures the sustainability of the planet. In such a scenario, complex ecological systems adds to the knowledge gaps. Mention can be made of the sustainability indicators based on stakeholder participation in Global Reporting Guidelines from the Global Reporting Initiative (GRI). In this, sustainability reports are shared for assessing the implication of sustainability on project management. In this, focus is placed on the indicators. In most of the projects, the companies and organizations use extensive research for adhering to the indicators in totality (Benitez-Amado, Llorens-Montes & Fernandez-Perez, 2015). However, selection of certain criteria proves beneficial in terms of achieving a better understanding for the aspects of sustainability. These aspects can be

Criteria	Aspects	Materials
Economic	–	Direct economic presence, Market presence
Environmental	–	Biodiversity
Social	Labour practices and decent work Human rights Society Product responsibility	Diversity and equal opportunities in labour and management relations Disciplinary practices Indigenous rights Community development Customer health and safety

Table 1: Indicators for sustainable development according to Global Reporting Guidelines

(Source: Leal Filho, Shiel & Paco, 2016)

International Project Management Association (IPMA) levies certain guidelines regarding the standards for project management competencies. Competence Baseline Version 3 (ICB 3) measures the approach of the personnel towards sustainable development through the means of IPMA certification systems. Consideration of the frameworks helps in ensuring the consistency and harmony within the application of the standards. As a matter of specification, there are two groups of competencies, which assists in measuring the approaches: behavioural and contextual. Along with this, Diouf and Boiral, (2017) proposes that technological competencies is an addition in this context. In the guidelines of the ICB 3, there is scarcity regarding the information about sustainability. “Assertiveness’ finds its mention in terms of the approach exposed by the interested parties towards attaining sustainability.

In case of the technological competencies, it is the capability of the personnel to make effective use of technologies for reducing the paperwork in the business operations. This approach conglomerates the behavioural and contextual approaches. This is in terms of using the systems judiciously for completing the business operations within the stipulated time. Consciousness towards frequent experiments of the systems relate with the behavioural context. On the other hand, Leal Filho, Shiel and Paco, (2016) feels that Risk assessment is one of the other aspects, which gains an important position in the technological competencies. Consideration of risk assessment matrix reflects the competencies towards problem solving. Other components of this parameter are consideration of software, which can calculate the budget including cost, scope, deliverables, structures, control, reporting and documentation.  

Leadership is one of the essential competencies in case of the behavioural trends towards sustainability. Typical evidence of this lies in controlling and tracking the performance management systems, so that estimates can be made for the future progress in terms of sustainability. This can be achieved through the means of self-control, which helps in controlling the performance of the others (Benitez-Amado, Llorens-Montes & Fernandez-Perez, 2015). Effective negotiation skills indicate the ability towards solving problems and crisis. Adherence to workplace ethics, within communication is effective in terms of gaining the trust, dependence and reliance of the clients.

Contextual competencies relate to project orientation, program and portfolio assessment in terms of controlling the business operations. Consideration of the issues of health, safety and security indicates the initiatives towards enhancing the parameter of environment.

Mention can be made of the European Eco-Management and Audit Scheme (EMAS), which has been implemented for monitoring the business operations in the organizations of Europe. In the era of 2010, International Organization for Standardization launched an additional international standard, ISO 26000 for providing guidelines to the public and private organization regarding enhancement of the corporate social responsibility (Formentini & Taticchi, 2016). Reference can be cited of 2000, when the OECD countries revised their Guideline for the Multinational Enterprises. This included recommendations for voluntary responsible businesses concerning employment and societal aspects. In the same era, 1500 companies presented sustainability reports based on Global Reporting Index (GRI) and Sustainability Reporting Guidelines.

Reference can be cited of the banks and funding authorities, which played major role in dissemination of the sustainability procedures. This dissemination acted as a mass appeal to the public for preserving the ecological biodiversity. Most of the companies are the target groups for these procedures, due to the assessed investments. One of the negative aspects of this investments is that they are not integrated into effective project management systems and tools. This absence of integration adds to the complexities towards assessment of the impacts on project management processes (McKinnon & Alston, 2016).

Conclusion

Projects act as keystone for the companies and organizations in terms of achieving sustainable development. In spite of different and wide ranging indicators, there have been scanty research on the impact of sustainability. Typical evidence of this lies in the lack of effective planning, as per the presentation regarding the impact of sustainability on the project management groups. The standards of project management fail to properly reflect the different aspects, which can be derived from the concepts of sustainability. This failure necessitates the need for modifications in the areas of project management processes, project management performance indicators and project management competencies. Most importantly, consciousness is needed in terms of making judicious use of the resources for sustaining the resources. This consciousness would help in maintaining the balance within the ecosystem.

References

Aarseth, W., Ahola, T., Aaltonen, K., Økland, A., & Andersen, B. (2017). Project sustainability strategies: A systematic literature review. International Journal of Project Management, 35(6), 1071-1083.

Beheiry, S. M., Chong, W. K., & Haas, C. T. (2006). Examining the business impact of owner commitment to sustainability. Journal of construction engineering and management, 132(4), 384-392.

Benitez-Amado, J., Llorens-Montes, F. J., & Fernandez-Perez, V. (2015). IT impact on talent management and operational environmental sustainability. Information Technology and Management, 16(3), 207-220.

Diouf, D., & Boiral, O. (2017). The quality of sustainability reports and impression management: A stakeholder perspective. Accounting, Auditing & Accountability Journal, 30(3), 643-667.

Dixon, J., Scura, L., Carpenter, R., & Sherman, P. (2013). Economic analysis of environmental impacts. Routledge.

Formentini, M., & Taticchi, P. (2016). Corporate sustainability approaches and governance mechanisms in sustainable supply chain management. Journal of Cleaner Production, 112, 1920-1933.

Gareis, R., Huemann, M., Martinuzzi, A., Weninger, C., & Sedlacko, M. (2013). Project management and sustainable development principles. Project Management Institute.

Golini, R., Kalchschmidt, M., & Landoni, P. (2015). Adoption of project management practices: The impact on international development projects of non-governmental organizations. International Journal of Project Management, 33(3), 650-663.

Gregersen, H. M., Lundgren, A. L., & White, T. A. (1994). Improving project management for sustainable development. Midwest Universities Consortium for International Activities, Inc.

Labuschagne, C., Brent, A. C., & Van Erck, R. P. (2005). Assessing the sustainability performances of industries. Journal of cleaner production, 13(4), 373-385.

Laszlo, C., & Zhexembayeva, N. (2017). Embedded sustainability. In Embedded Sustainability (pp. 116-140). Routledge.

Leal Filho, W., Shiel, C., & Paco, A. (2016). Implementing and operationalising integrative approaches to sustainability in higher education: the role of project-oriented learning. Journal of cleaner Production, 133, 126-135.

Maas, K., Schaltegger, S., & Crutzen, N. (2016). Integrating corporate sustainability assessment, management accounting, control, and reporting. Journal of Cleaner Production, 136, 237-248.

Maier, S., Beck, T., Francisco Vallejo, J., Horn, R., Söhlemann, J. H., & Nguyen, T. (2016). Methodological approach for the sustainability assessment of development cooperation projects for built innovations based on the SDGs and life cycle thinking. Sustainability, 8(10), 1006.

Marcelino-Sádaba, S., González-Jaen, L. F., & Pérez-Ezcurdia, A. (2015). Using project management as a way to sustainability. From a comprehensive review to a framework definition. Journal of cleaner production, 99, 1-16.

Martens, M. L., & Carvalho, M. M. (2016). Sustainability and success variables in the project management context: an expert panel. Project Management Journal, 47(6), 24-43.

Martens, M. L., & Carvalho, M. M. (2016). The challenge of introducing sustainability into project management function: multiple-case studies. Journal of Cleaner Production, 117, 29-40.

Martens, M. L., & Carvalho, M. M. (2017). Key factors of sustainability in project management context: A survey exploring the project managers’ perspective. International Journal of Project Management, 35(6), 1084-1102.

McKinnon, J., & Alston, M. (Eds.). (2016). Ecological social work: Towards sustainability. Macmillan International Higher Education.

Sánchez, M. A. (2015). Integrating sustainability issues into project management. Journal of Cleaner Production, 96, 319-330.

Silvius, A. G., & Schipper, R. P. (2014). Sustainability in project management competencies: analyzing the competence gap of project managers. Journal of Human Resource and Sustainability Studies, 2(02), 40.

Silvius, A. J., & Schipper, R. P. (2014). Sustainability in project management: A literature review and impact analysis. Social Business, 4(1), 63-96.

Silvius, G. G., Köhler, A., & van den Brink, J. (2011). The impact of sustainability on project management. The Project as a Social System: Asia-Pacific Perspectives on Project Management.

SILvIuS, G. I. L. B. E. R. T., SChIPPER, R. O. N., Van Den Brink, J., & Planko, J. (2012). Sustainability in project management. Gower Publishing, Ltd..