Sustainable Business Strategy

Abstract

Sustainable business strategy is the integration of economic, environmental, and social aims into a firm’s goals, activities, and planning, with the aim of creating long-term value for the firm, its stakeholders, and the wider society. This means that strategy is formulated and executed so that the needs of the firm and its stakeholders are met today, while protecting, sustaining, and enhancing the natural and resources that will be needed in the future.

Full text

SUSTAINABLE BUSINESS STRATEGY
Dr Thomas B. Long, Centre for Sustainable Entrepreneurship, University of Groningen/Campus Fryslân,
Leeuwarden, The Netherlands, t.b.long@rug.nl
Please cite as:
Thomas B. Long, (2019) Sustainable Business Strategy. In Leal Filho, W., Azul, A.M., Brandli, L., Özuyar,
P.G., Wall, T. (Eds.) Encyclopedia of the UN Sustainable Development Goals: Decent Work and Economic
Growth. Springer, UK.
B. Synonyms (if applicable)
Sustainable business
Environmental strategy
Social strategy
Sustainable business models
Corporate responsibility
Shared value creation
Sustainable value creation
C. Definitions
Sustainability business strategy is the integration of economic, environmental and social aims into a firm’s
goals, activities and planning, with the aim of creating long-term value for the firm, its stakeholders and wider
society. This means that strategy is formulated and executed so that the needs of the firm and its stakeholders
are met today, while protecting, sustaining and enhancing the natural resources that will be needed in the
future.
Main Body Text
Introduction
The creation of a sustainable, just and equitable economy will require fundamental shifts in the way
businesses operate. Businesses, in particular, bear some responsibility for many of the social and
environmental problems currently afflicting society, such as exploitative working conditions, or the
destruction of habitats.
The core aim of conventional business strategy is the production of economic value – generally profits – for
the short to medium term. These strategies aim to create value for a narrow set of stakeholders – primarily,
owners and shareholders. Developing value beyond these actors was traditionally seen as illegitimate
(Friedman 1970). In this view, preventing or solving social or environmental problems, is the responsibility of
individual shareholders, for instance through charitable giving, or governments, who could use tax revenues.
The narrow pursuit of profits is associated with many of the issues and challenges currently facing society,
such as poor working condition, low wages, and environmental degradation.
This narrow view of strategy is now changing. As this chapter will show, businesses are increasingly
developing strategies that integrate sustainability aims and objectives. These strategies do not just aim to
reduce negative social and environmental impacts, but also seek to enable businesses to have a positive and

regenerative impact on society and nature. This is important, as businesses, and in turn, the strategies they
use, can have a profound influence on production and consumption patterns (Michaelis 2003). Nike, Apple
or Walmart for example, represent a business community with global reach and influence. This has meant
that businesses operated with enhanced political and economic power, making it difficult for any single
government or regulatory organisation to control and influence them. It also means that there is the potential
to harness this power and influence for the achievement of sustainability aims. This is the aim of sustainable
strategy.
Conventional business strategies have a range of links to Goal 8: Decent work and economic growth. For
instance, conventional strategies have often sought to minimize labour costs, paying workers the minimum
amount possible. As we will show, business strategies can have an important influence on the aims of goal 8.
The wages earned by workers and the conditions they work under are influenced by company strategy, as are
the type of innovations pursued and how they are developed. Strategy will also influence where a company
locates and even the number and types of jobs provided.
In the following sections, we first consider the factors that drive the development and implementation of
sustainable strategies. Next, the form and nature of sustainable strategies will be considered, alongside how
they increase in maturity. Circular economy, as a particularly promising sustainable strategy will be explored,
before considering some criticisms to the sustainable strategy approach. Throughout we will highlight how
businesses, through their strategies, influence work, innovations and growth.
The origins of sustainable strategy: context and driving factors
The development of sustainable strategies is dependent on a range of facilitating contextual factors as well as
drivers. These help create the opportunities necessary for sustainable strategies to be successful, as well as
motivate business to design and enact new sustainable strategies. External and systemic factors are explored
first, after which, factors linked to the internal dynamics of businesses are considered.
The global capitalist system and the markets that it includes cause many sustainability issues; including
widening inequality, exploitative labour practices and many environmental issues. They also create the
opportunities needed for sustainable strategy to be successful (Cohen and Winn 2007; Hart, Milstein, and
Caggiano 2005). For instance, the industrialisation of economic activity and associated consumption levels
create obvious environmental problems (Hart, Milstein, and Caggiano 2005). Current production techniques
are associated with low levels of efficiency in many markets, which is represented by the high amount of
waste created by many industrial processes. Cohen and Winn (2007) highlight the example of a
semiconductor chip, the production of which is associated with waste that represents 100,000 times its weight
(Cohen and Winn 2007; Hawken, Lovins, and Lovins 2013). These market inefficiencies provide the space
for improvements. Sustainable strategies often target these improvements, through for instance, eco-
efficiency strategies. These can reduce costs for businesses, which we will examine in the next section. The
capitalist system is also associated with widening inequalities, creating opportunities (or the need for)
strategies linked to resource ownership and community development.
Current markets also create externalities. These are the consequences of business activities, which affect
stakeholder such as local communities, but are not reflected in the price of the product or service. They can
be positive or negative – we focus on the negative kind, where producers and users avoid the costs of the
externality, placing them instead communities and the environment. Within the current system, it is in the
interest of businesses to externalise as many costs as possible, whether this is through carbon emissions into
the atmosphere, dumping wastes into local rivers or paying local workers the lowest wages possible. The
existence of externalities creates opportunities for sustainable strategies, such as the development of new
technologies that reduce externalities. These can create reputation improvements for firms or take advantage
of regulations aiming to stop externalities.

The pricing and valuation of resources in current economic systems also creates opportunities for strategy
changes. Many natural resources are both exhaustible and undervalued, which is contrary to assumptions used
to value them (mainly, that they are infinitely plentiful). This means that finite resource are used inefficiently
or potentially exhausted completely – this is especially problematic where resources provide critical ecosystem
services such as fresh air or water. Increasing recognition of the value of these resources is moving the status
quo closer to more accurate pricing, and as this happens, this in turn creates opportunities for sustainable
strategies by entrepreneurs and incumbents, such as new products, customer segments, or how these
resources are owned and managed. Maintaining local community control and ownership can promote more
sustainable use, and also ensures that local people benefit through jobs or the extraction of appropriate rents.
The fourth key systemic imperfection creating opportunities for sustainable strategies is the lack of perfect
information. Current markets, in theory, rely on all actors having perfect information, which is rarely, if ever,
the case. This lack of knowledge on part of the consumer creates a market imperfection, where consumers
make uninformed buying decisions, often at the cost of both the environment and their wallets. Cohen and
Winn (2007) provide the example of low consumer understanding of energy consumption in the home, in
terms of how much they use, the relative benefits of different fuel sources or the rate of return on potential
improvements. This often results in an inefficient and wasteful system, and one which is more expensive for
often cash strapped consumers – which in turn, creates opportunities for businesses to enact strategies to
improve this situation, for instance, through servitization or the use of smart meters.
More widely, globalisation and the inequality it is associated with, can provide business opportunities at the
‘bottom-of-the-pyramid’ (BOP). Globalisation has lifted many millions out of poverty; yet it has also led to
increasing inequality and poverty (Hart, Milstein, and Caggiano 2005). While markets in developed countries
are well developed and subject to fierce competition between industry rivals, those in the developing world
are often underserved. Companies have overlooked opportunities to meet fundamental societal needs, which
businesses with sustainable strategies can fill.
The increasing prominence of sustainability problems and improved understanding of their nature and source
has meant that the reputation and standing of business has suffered. Prominent strategy thinkers highlight
this as a key driver of the need for businesses to rejuvenate their approach to strategy – again, sustainability is
given as a solution, offering businesses new opportunities and reducing societal ills (Porter and Kramer 2011).
The role of reputation in driving sustainable strategy creation is linked to an increasingly connected and
assertive civil society (Hart, Milstein, and Caggiano 2005), who much improved access to information.
Business are increasingly held accountable for social and environmental impacts, including those that occur
outside of their organisational boundaries. For instance, impacts occurring up or down stream in supply
chains are now attributed to the lead business, often a manufacturer or consumer facing retailer. This is
especially problematic for businesses who hold high amounts of value in their reputation and brands. As will
be shown, sustainability strategies can interact with these features providing tangible benefits to businesses
enacting sustainable strategies. For example, child labour accusations damaged the Nike brand, with sales
ultimately impacting by boycotts (Beder 2002). Linking (un)sustainable practices and business value provides
an avenue through which sustainability can affect business’s bottom line.
More widely, enhanced business performance is linked to contextual factors, such as the health of ecosystems
or local communities (Porter and Kramer 2011). The competitiveness of a company and the health of the
communities around it are closely intertwined, providing further rationale and drivers for sustainable
strategies. A happy, healthy, equal and well-functioning community is critical for the effective functioning of
business.
Many of the dynamics creating opportunities for sustainable strategies and the drive to enact these them
focus on internal organisational elements. While brand and reputation are influenced by external events,
internal dynamics are also important. For instance, while market structures contribute to the creation of

inefficiencies, the management of inefficiencies is an internal management competence (Schaltegger and
Wagner 2011). Environmental or social impacts can create internal costs for firms, such as wasted energy or
the costs of public relations campaigns. Unhappy and exploited workers will be less efficient, and less likely to
genuinely work towards a firm’s long-term benefit. Targeting these inefficiencies can reduce costs and risk.
A shift away from a focus on short-term profit to longer-term performance is often at the center of many
sustainable strategies. The extension of time horizons reduces the likelihood of businesses inflicting negative
externalities on communities and can make many sustainability initiatives attractive in terms of ROI (Fowler
and Hope 2007). Such ‘win-win’ outcomes are now well documents in both academic and practitioner
literature (Beckmann, Hielscher, and Pies 2014). ‘Win-win’ outcomes can stretch to factors such as enhanced
attractiveness as an employer and improved capacity to innovate (Schaltegger and Wagner 2011).
Business cases for sustainable strategy
Businesses are founded and run for economic purposes. So, while contextual factors have created the
necessary background for change, this is not sufficient to encourage the transition needed. The development
of sustainable strategies requires the linking of sustainability to the creation of shareholder value. Linking
these types of values legitimises sustainability actions within conventional business contexts, highlighting how
the generation of benefits for wider stakeholders is advantageous to the long-term prosperity of a business
(Hart, Milstein, and Caggiano 2005; Porter and Kramer 2011).
To link shareholder (economic) value with environmental or social value creation requires the development
of a business case for sustainability (Schaltegger and Wagner 2011). This produces a situation where enhanced
economic success is achieved with positive social and/or environmental impacts. The link between
sustainability and business benefit is not automatic, meaning that strategic business objectives must be
purposefully linked to and oriented towards sustainability.
The generation of a business case for sustainability has implications for the competitiveness strategy of a
business (Baumgartner and Ebner 2010); the degree to which a sustainability strategy enhances or detracts
from the generation of economic value can be described as the ‘fit’. For instance, the best fit would involve
the sustainability strategy being an essential component of overall business strategy. This would enhance the
generation of economic returns – positive from a business perspective and achieve wider sustainability
outcomes. Poor sustainability strategies will create conflicting goals between competitiveness and
sustainability, enhancing the likelihood that the strategy be dropped.
Early thinking on sustainable strategy saw that firm performance is predicated on the resources available to it,
including those of the natural environment (Hart, Milstein, and Caggiano 2005; Fowler and Hope 2007). This
line of thinking is known as the natural-resource-based-view of the firm. Three interconnected basic strategies
are recommended: 1) Pollution prevention, where wastes are reduced through production changes (rather
than end-of-pipe applications). 2) Product stewardship and the use of tools such as life-cycle assessment to
reduce the impacts of a product over its whole lifetime; and 3) sustainable development, where the business
considers the impacts on and engages with stakeholders in this developing world. These strategies are path
dependent, for instance, product stewardship efforts are dependent upon its prior capability in pollution
prevention, and its sustainable development efforts are dependent upon its capability in pollution prevention
and product stewardship.
The concept of shared value creation emerged later, and was instrumental in moving the idea of sustainable
strategy into the more mainstream business consciousness (Porter and Kramer 2011). A shared value creation
perspective proposed that business performance can be enhanced (alongside the solving of reputational
issues) by increasing the share of value for everyone. Creating economic value by creating societal value can
occur in three ways. First, by reconceiving of products and markets, and producing products that help to
solve societal problems. Society gains because businesses will often be more effective than governments at

solving societal issues. Businesses start by identifying societal needs that could be met through products and
services, and then commercialises these products, reaping income while also creating wider value. For
instance, the raising of awareness of the need for hygiene by an antibacterial soap company enhances sales
and provides a community benefit (less infection and disease).
Redefining productivity in the value chain is the next key strategy, involving the creation of societal value by
reducing externalities of production, such as waste or poor labour practices. These externalities often also
inflict internal costs on the firm, meaning reducing them benefits the business as well as local communities.
This can involve focusing on energy use and logistics, resource use, procurement distribution, employee
productivity and firm location. Finally, the third strategy involves building supportive industry clusters.
Productivity and innovation are strongly influenced by the proximity of other firms and related services
provided by suppliers, universities or support professionals. By helping to build these clusters, by investing in
infrastructure for instance, firms benefit local communities as well as themselves (Porter and Kramer 2011).
Firms benefit from improved access to labour, ideas and financing, while local communities have improved
employment options, better infrastructure and improving community prospects.
These types of strategies can have wider positive influences on Goal 8. For instance, the reconceiving of
products and pollution prevention can be a driver for innovation. This in turn can create new process, new
products or even new industries. These would be lower impact and have the potential to provide employment
as well as growth. Shared value creation explicitly seeks to ensure that the ‘pie’ is shared more widely, partly,
by ensuring a bigger pie in total. This can help to provide community programs or enhanced working
practices, which can help to stimulate virtuous cycles of development if managed correctly. Although these
approaches represent initial business reactions to sustainability challenges – as they still focus to a large extent
on economic outcomes – it is still possible to see how they can start to see how business strategies can
positively influence socio-economic outcomes.
Sustainable business strategy and maturity scales: charting the journey through sustainable
strategy
Sustainability strategy has three core dimensions (Baumgartner and Ebner 2010). These include an economic
dimension, containing those activities which are required for a business to remain functioning in the market.
Factors such as innovation, collaboration or knowledge management are critical business functions in terms
of developing economically valuable products or services. Without this element, businesses will be unable to
finance themselves, and will ultimately become bankrupt.
Ecological dimensions of sustainable strategy concern environmental activities that cause or prevent
environmental impacts. These include, for instance, recycling, biodiversity, or waste management. These
processes help mediate the relationship between the business and the physical or natural environment. It is
these aspects that can help sustainable strategies to contribute towards sustainable economic growth in terms
of environmental dimensions. Current growth is associated with unsustainable production and consumption,
but integration of sustainable strategies can help to ensure that growth decoupled from material consumption
and exploitation.
The social dimension of a sustainable strategy has internal and external dimensions. Internally, aspects such
corporate governance and employee health and safety are important – they can improve productivity,
enhance the attractiveness of a business as an employer and ensure that internal policies are ethical. It is these
aspects that are critical for targets concerned with good, safe, just and fairly paid livelihoods. Externally, social
dimensions focus on how the business relates to external stakeholders, and its wider ethical behaviour in the
community.
As noted, sustainability strategies can be integrated into a business’s wider strategy to a greater or lesser
extent. This has implications for the effectiveness of the sustainability strategy as well as the broader

competitiveness strategy of the business. Initial sustainability strategies are likely to be light touch, involving
minor changes to management systems or alike. As drivers increase and businesses become more adept at
integrating sustainability, strategies become more mature. The most effective sustainability strategies are those
which are fully integrated into a firms overall strategy, and will involve adjustments to the underlying
organisational logic (Baumgartner and Ebner 2010; Blok et al. 2015; Long, Looijen, and Blok 2018).
Various maturity scales for sustainability strategy have been developed, all illustrating how organisations start
from a low point, to where sustainability is fully integrated (Baumgartner and Ebner 2010; Schaltegger and
Wagner 2011). Initial, early strategies are termed defensive or introverted. They describe a narrow and reactive
sustainability strategy focused on compliance and risk mitigation. The approach to sustainability is likely to be
driven by cost constraint and is little more than compliance with official or civic regulation. Activities could
include the introduction of basic environmental management systems to reduce inefficiencies or limited
efforts at transparency through sustainability reporting.
Accommodative or extroverted approaches represent a next step, involving cautious modifications to the
businesses but without questioning the revenue logic or core business aims. This could include more
enhanced use of management systems, for instance, for environmental protection or eco-efficiency. There
would be more focus on external relationships and the need for a ‘license to operate’. Many corporate social
responsibility initiatives could be consistent with this approach. These represent efforts by business to engage
in social or environmental initiatives, but as ‘bolt-on’ programs. While they can have positive influences they
can be at risk of being ended as they are not necessary for a firms core function (Lefebvre and Lefebvre 2012;
Campbell 2007).
A third, conservative stage involves further focus on cleaner production. This can include pollution prevention
and eco-efficiency initiatives that alter systems and processes that contribute to the creation of waste.
Innovation and the use of new technology enables internal production processes or the actual design of
products and services to be changed. Product stewardship ideas fit within this approach, where the business
seeks to lengthen product use periods. While this can reduce sales, as products do not need replacing so
often, businesses can implement maintenance or other servicing type approaches to enhance economic
returns and lengthen the life of products (Hart, Milstein, and Caggiano 2005; Lehni 2000). This is a good
example of how businesses can maintain revenues while limiting or reducing materials flows (which we
consider more in the following sections).
Finally, a proactive or holistic stage is reached, where sustainability strategy is fully integrated into all business
activities. Competitive advantage is derived from differentiation and innovation, offering customers and
stakeholders’ unique advantages through sustainability. This means that sustainability is fully intertwined into
company strategy, meaning sustainability elements are not at risk of being dropped. Within this approach,
stakeholders are extensively engaged and are given opportunities to share ideas and resources, creating a
favourable institutional context for sustainable development (Gast, Gundolf, and Cesinger 2017). This final
stage of sustainable strategy is likely to involve a redefinition of the underlying organisational logic of the
business, which involves changes to the business models used.
Business models and sustainable strategy
As organizations sustainability strategies mature, they start to change the business model. A business model
describes the underlying logic of how an organization operates. The business model helps to define the
competitive strategy, impacts the design of products (and so also environmental and social impacts in the
value chain), the value the product delivers (including environmental or social value), and how the firm
captures some of this value (Rasmussen 2007). At its core, the business model will outline a value
proposition, value creation and value capture aspects (Teece 2010).

Sustainable strategies create sustainable business models. These create competitive advantage for the business
organization, but in a way that contributes to sustainability (Bocken et al. 2014; Boons and Lüdeke-Freund
2013). The development of a sustainable business model is a requirement for sustainable strategy. Different
types of sustainable business models are found, each providing different solutions to different challenges
(Bocken et al. 2014).
Bocken et al. (2014), in their research on sustainable business model archetypes, identify technological, social
and organizational types, each able to support different sustainable strategy. Technological archetypes include:
1) the maximization of material and energy efficiency. This business model type seeks to do more with fewer
resources, generating less waste, emissions and pollution. In this way, it has links with eco-efficiency
initiatives. 2) Business models that create value from waste can reduce pollution and reduce costs in the
production process; wastes are often seen as undesirable, and so if a business model and accompanying
strategy are able to use these inputs, they are often at lower cost and help reduce wastes that need processing
or dumping into the environment. 3) Substitute with renewables and natural processes – these business models
reduce environmental impacts and increase organizational resilience by reducing reliance on finite or hard to
get inputs.
Socially orientated sustainable business models cover the next three types. These include 4) functionality rather
than ownership. These business models satisfy users’ needs without the users having to own the physical
products. This enables organizations to ensure that machinery and capital is used in an optimal way, while
they are also better able to manage material flows – helping to decuple growth from material use, in turn
helping to facilitate sustainable growth. For instance, think of a car – your car is likely to sit idle in your garage
for the majority of the time, while with a functionality business model, it can be used more ensuring its
relative embodied environmental impact is reduced. 5) Adopt a stewardship role business models involve
proactively engaging with stakeholders to ensure their long-term health and well-being; stewardship and
certification schemes are good examples of this type of approach, where organizations are accredited as to
their efforts at long-term care of a resource or community. 6) Encouraging sufficiency: These business models
actively seek to reduce consumption and production, often through demand and supply side effects. For
instance, energy service companies encourage consumers to reduce energy use. This would usually reduce
revenue for the energy provider. However, with innovative contracts or government support, these
organizations are able to benefit by reducing overall energy consumption.
The final two types of sustainable business model relate to organizational elements. These include: 7)
repurposing for society or the environment, such as prioritizing social or environmental value creation, over economic
profit. This is often achieved by aligning with and integrating local communities and stakeholders into the
organization. 8) The development of scale up solutions, which involves ensuring that effective local solutions can be
scaled to enhance impact.
It should be highlighted that business models are simplifications to aid in design and assessment. In this way,
the development of a full strategy involves placing the business models within specific contexts, considering
local conditions, competitors, regulations etc. These business model types can also be used together. The use
of any one of these archetypes does not necessarily mean that another cannot also be integrated when
considering the development of a full scale and implementable sustainable strategy. In this next section, we
consider circular economy as a specific sustainable strategy. This is due to its potential to provide significant
environmental value.
Circular economy and sustainable strategy
Circular economic is a new approach to sustainability. Its potential is in part due to its applicability to a wide
range of organizations. Circular economy is the opposite of a linear economy, which is characteristic of most
contemporary production processes, where natural resources are converted into products, via production,

which then turn to wastes. This means natural capital is used, and never restored. Circular economy strategies
aim to have no net effect on the environment, restoring damaging resource acquisition, while reducing the
waste generated in production (Gast, Gundolf, and Cesinger 2017; Murray, Skene, and Haynes 2017;
Geissdoerfer et al. 2017). A key premise of this approach is that overall systems (and strategies) are
optimized, rather than individual components. This is achieved via design to re-design thinking, and other
novel innovation techniques.
Circular economy strategies have grown from work by industrial ecologists in the 1990s. The aim was to
create a system with (near) complete internal cycling of materials (MacArthur 2013). The 4R framework of
reduce, reuse, remanufacture and recycle is often used as a hierarchy of preferred options for managing
materials. Reduce involves increasing efficiency by consuming fewer natural resources and materials during
both the production and use phases. Reuse involves ensuring that old products that are still able to function
are still used. While remanufacture takes old and often worn-out products and through processing, and
ensures that they retain their original function. Lastly, recycling involves further processing of materials to
obtain the same or lower quality (Kirchherr et al. 2017). How circular economic interacts with social aspects,
such as working conditions or wider social issues is not so clear. However, these types of strategies can help
to create new industries, new jobs as well as the creation of more sustainable economies.
Criticisms of sustainable strategy
‘Win-win’ versus the reality of trade-offs
Engaging with sustainability issues involves attempting to marry opposing values – namely, economic profit
with social or environmental value creation (Zahra et al. 2009; Smith and Lewis 2011). Those individuals
attempting to develop sustainable strategies have to tread a fine line, balancing these often-competing
objectives. Much of the sustainable strategy literature focuses on those situations where ‘win-win’ outcomes
exist, where economic profits can be made while also ensuring social and/or environmental value creation.
This perspective has been critical in ensuring that the debate on strategy shifted, to a point where
sustainability is legitimised. However, it can also limit the scope and potential for action to only those
situations where clear ‘win-wins’ exist (T. Hahn et al. 2010; R. Hahn, Spieth, and Ince 2018). This is
problematic, especially in situations where large social or environmental value gains can be made, but at a
small economic cost to a business. Within the win-win perspective, such actions would seem illegitimate and
as such inhibit action. This means potentially impactful actions would not be undertaken and result in
considerable loss of potential in terms of societal or environmental improvement.
The management of these competing objectives can be viewed in terms of ‘paradox’, which in turn can be
useful for designing sustainable strategies that are able to deal with these tensions (Hargrave and Van de Ven
2017). A paradox is defined as “contradictory yet interrelated elements – elements that seem logical in
isolation but absurd and irrational when appearing simultaneously” (Lewis 2000).
Tackling these tensions and contradictions head-on, in an ‘integrative’ manner is recommended, as this can
promote creativity and innovation (Hahn et al., 2018). By taking this perspective, even where clear ‘win-wins’
are absent, businesses can legitimately address environmental and social concerns (Rivoli and Waddock 2011)
or to engage stakeholders who have limited business relevance (Hart and Sharma 2004). By accepting that
clear ‘win-win’ situations may not always exist expands the scope of legitimate business action, and can
stimulate enhanced innovation and solution finding.
A first step in managing these tensions involved recognizing and acknowledging them (Hahn 2010). This is
something that is absent in much of the early sustainable strategy concepts previously discussed. Following
this, various management approaches are available (T. Hahn et al. 2010, 2015; Smith and Lewis 2011). These
include, ‘acceptance’ that attempts to ‘live with’ the conflict by shifting expectations, or via making do.
‘Resolution’ strategies are also available, such as separation of the objectives either spatially (location or levels)

or temporally (one aim first, and then the other). A synergy approach seeks a view that accommodates the
opposing poles.
Limits of sustainable strategies
Apart from the limiting effect of only operating within ‘win-win’ contexts, sustainable strategies are subject to
a range of criticisms. For instance, aside from circular economy, many sustainable strategies fail to
acknowledge the ecological limits of the biosphere, focusing on eco-efficiency rather than eco-effectiveness
approaches (Dyllick and Hockerts 2002). Such thinking is also based on ideas that current technological
progress will ‘save’ humanity from environmental limits, and that prosperity will help to create awareness,
further reducing environmental stressors. Therefore, while sustainable strategies are important and necessary
for the creation of sustainability, they are unlikely to be sufficient. For instance, wider economic systems will
need to be adjusted, as well as changes to consumer mind-sets (Naess 2011). Questions over the
appropriateness of continued growth also exist. Even where materiality is separated from growth, it rarely
stays stable or reduces – rather, it just increases at a slower rate. Within this perspective, growth is questioned
as an aim in itself.
Many sustainability strategies, especially those of a younger or shallower nature are criticized for being
unoriginal and ineffective. While they may lead to business benefits, the social or environmental returns are
likely to be negligible (Crane et al. 2014). These approaches are also potentially naïve about the challenges of
business compliance. Business motives and conduct are treated as a given, whereas in reality, these actors
have often behaved in amoral ways. Much thinking on sustainable strategies do not question the sanctity of
corporate self-interest or fundamental models of strategy. For instance, many sustainability problems are
systematic in nature, meaning individual businesses are unlikely to be able to deal with them alone.
Future prospects
The development of sustainable strategies and associated thinking has dramatically shifted the debate
concerning businesses contribution to sustainable development goals. Sustainability is now considered an
everyday parlance in many organisational contexts. While awareness of environmental and social problems,
and the role that businesses in particular play in their creation is higher than ever before.
However, the scale and complexity of sustainability challenges, means that the “the current rate of change is
not commensurate with the challenge we face” (Staafgard 2008p. 34). While sustainable strategies are evident,
they are not the norm. For further progress to be made, changes to wider systems and mindsets are likely to
be needed. Contemporary businesses may struggle to see how paying higher wages can be beneficial for the
business, or how ensuring that more challenging sustainability aims are integrated into innovation targets are
worth the cost. These types of changes will expand the scope for successful sustainability strategies and
enhance the ability of sustainable business strategies to compete against non-sustainable ones.
Cross-References
Corporate Social Responsibility (Molderez, I.)
Circular Economy (Krikke, H.)
Decoupling of economic growth from environmental degradation (Somani, Z.)
Enterprises (Inigo, E.)
Inclusive Business Models (Dentchev, N.)
Social Business (Neiva, S., McQueen, J., de Andrade Guerra, J.)
Social Entrepreneurship (Lubberink, R.)

Sustainable business models (Bocken N.)
Sustainable Entrepreneurship (Schaltegger, S., Johnson, M.)
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