Business Sustainability Indices

Business Sustainability Indices

Arunasalam Sambhanthan (Curtin University, Australia)
Copyright: © 2018 |Pages: 11
DOI: 10.4018/978-1-5225-2255-3.ch053

Abstract

Business sustainability models and indices are useful in theorizing and measuring organizational elements of sustainability. It is often the case that there are not many models and scales out there in the literature for theorizing business sustainability. Existing sustainability models from the published literature are reviewed. The review suggests that there is not much documented research exist in business sustainability typologies. There is a considerable amount of research effort required from the applied researchers working in this area to contextualize and re-specify the business sustainability typologies to differing industry clusters such as e-learning, agriculture, manufacturing and healthcare. In addition to this the paper also reviews the existing indices available out there in the literature to measure sustainability. A summary of existing sustainability indices available to measure sustainability at country level has been and a number of business sustainability indices have been presented and followed by a discussion of future research directions.
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The Sustainability Hierarchy

Four sustainability frameworks have been identified as ‘ambiguous with regard to what is being sustained’. The label ‘unsustainable’ has been categorized into four levels of actions which prevent sustainability of any kind. This led towards the development of a Sustainability hierarchy (Marshall & Toffel, 2005) which was constructed using several distinct but related concepts (refer to Figure 1).

Figure 1.

Business sustainability hierarchy

The above hierarchy is an action centered hierarchy which looks at the sustainability from a hierarchical model as depicted above. The model is based on the hierarchy of needs theory propounded by Abraham Maslow. The needs theory indicates that the satisfaction of lower level needs leads towards the higher level need in the hierarchy. The same metaphor is applied here for environmental sustainability in this context. The achievement of a lower level environmental metric leads to the achievement of the higher level one in the hierarchy.

The main shortcoming of this model in terms of applying to business sustainability is its lack of specialization to business domain. The model is named as sustainability hierarchy which could be applied to anything which has the ability to be applied to the sustainability research. Therefore, the above model is argued to be not contextually relevant for assessing and benchmarking sustainability in organizations. A definition of business sustainability goes as “adapting business strategies and activities that meet the needs of the enterprise and its stakeholders today while protecting, sustaining and enhancing the human and natural resources that will be needed in the future” (International Institute of Business Sustainability). Therefore, the following section focuses on reviewing the business sustainability typologies out there in the literature.

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The System Based Sustainability Business Models

Models to assess business sustainability have been less documented in the literature. Besides industry specific frameworks there are a number of common frameworks out there in the literature such as the European Corporate Sustainability Framework (ECSF) (Costanza & Patten, 1995), there have been less documented models out there in the published literature to assess and benchmark business sustainability. The industry specific frameworks and the ECSF all could be classified as frameworks than of models. The System Based Sustainability Business Model documented by (Dyllick & Muff, 2013) has four characteristics such as economic characteristics, environmental characteristics, social characteristics and multidimensional or social characteristics – each of which is attributed into two attributes namely structural attributes and cultural attributes.

Key Terms in this Chapter

Indicators: The pointers of the sustainability performance of certain industries.

Indices: The measurement criterion used for assessing the sustainability of different industries.

Sustainability: The ability to sustain a certain period of time.

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