Linking owner–managers' personal sustainability behaviors and corporate practices in SMEs: The moderating roles of perceived advantages and environmental hostility

• Author: Jean‐Marie Courrent,Sonia Chassé
• DOI: http://doi.org/10.1111/beer.12176
• Date: 01 April 2018
• Published date: 01 April 2018

ORIGINAL ARTICLE

Linking owner–managers’personal sustainability behaviors and

corporate practices in SMEs: The moderating roles of perceived

advantages and environmental hostility

Sonia Chass

e

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Jean-Marie Courrent

Espace Richter-Avenue Raymond Dugrand,

CS 59640, Montpellier Research in

Management/LabEx Entreprendre,

Montpellier Management Institute,

University of Montpellier, 34960

Montpellier cedex 2, France

Correspondence

Sonia Chass

e, Espace Richter-Avenue

Raymond Dugrand, CS 59640, Montpellier

Research in Management/LabEx

Entreprendre, Montpellier Management

Institute, University of Montpellier,

34960 Montpellier cedex 2, France.

Email: sonia.chasse@fsa.ulaval.ca

Drawing on managerial discretion and conflicting institutional logics literature, this study investi-

gates the relationbetween the personal sustainability behaviors (PSB)of owner–managers and the

corporate sustainability practices (CS practices) of SMEs. The research proposes a contingency

model that assesses the moderating effects of perceived economic advantagesand environmental

hostility on this relationship. Based on linear hierarchical multiple regression analyses of a cross-

sectoral sample of French SMEs, the results suggest a positive influence of the manager’sPSBon

the SME’s CS practicesthat appears to be differently moderateddepending on the type of practice

considered. The influence on environmental practices is fostered through the perception of eco-

nomic advantages. The influence on workplace practices is only effective when the business

environment is deemedbenign and the influence on communitypractices is dampened by the per-

ception of environmental hostility. Highlighting the trade-off between the manager’s personal

values and the SME’seconomic constraints, these findings contribute to a better understandingof

the critical antecedents of sustainabilityin small businesses.

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INTRODUCTION

Since the publication of the Brundtland Commission report (), sustain-

able development (SD), which includes economic, environmental, and

social issues, has increasingly benefited from a positive reception

worldwide. Despite the conceptual criticisms it has attracted (Baden &

Harwood, 2013), the fact remains that SD conveys socially desirable

values (Petts, Herd, Gerrard, & Horne, 1999; Roxas & Lindsay, 2012),

which means that it benefits from keen interest and unambiguous dif-

fusion in society, in academia and in the business world (Campbell,

2007; Carroll & Shabana, 2010; Glavas & Kelley, 2014; Holt &

Barkemeyer, 2012; Revell, Stokes, & Chen, 2010). In this context, and

although the term has greatly evolved over the years, SD refersto the

notion of corporatesustainability (CS) when appliedto business entities

and “involves corporations’taking into consideration their environmen-

tal and social impacts in concert with their economic objectives”

(Strand, 2014,p. 688).

In fact, empirical academic studies on CS have focused more on

the organizational level than on the individual level (Aguinis & Glavas,

2012; Frynas & Yamahaki, 2016; Waldman & Siegel, 2008), although

the moral judgmentthat underlies subscribing to sustainability values is

inherently individual (see e.g., Kant, 1788).The personal role played by

top management in implementing CS has been widely acknowledged

(Aguinis & Glavas, 2012; Hemingway & Maclagan, 2004; Waldman &

Siegel, 2008; Waldman, de Luque, Washburn,& House, 2006). In small

and medium-sized enterprises (SMEs), the importance of the owner–

manager (hereinafter referred to as “manager”) is particularly apparent

because there is a high level of organizational identification with him/

her (Aragon-Correa, Hurtado-Torres, Sharma, & Garcia-Morales, 2008;

Coppa & Sriramesh, 2013; Fuller & Tian, 2006). This results in the

strong possibility that the manager’s personal values and perceptions

will affect his/her professional behavior (Coppa & Sriramesh, 2013;

Marcus, MacDonald,& Sulsky, 2015; Quinn, 1997).

This convergencelogic assumes a causal linkbetween personal val-

ues and firm practices.From this perspective, supported particularly by

the upper echelons and managerial discretion theories (Hambrick,

2007; Hambrick& Mason, 1984),understanding organizationalorienta-

tions means that “we mustconsider the biases and dispositions of their

most powerful actors –their top executives”(Hambrick, 2007, p. 334).

In the literature, CS is notably associated with notions of responsibility

and managerialdiscretion (Montiel, 2008).

Nonetheless,the manager’s scope of action (i.e., managerialdiscre-

tion) may be limited by his/her perceptions of certain significant situa-

tional factors (Hambrick, 2007; Hambrick & Finkelstein, 1987). Thus,

although the manager’s personal behavior can be transposed into his/

BusinessEthics: A Eur Rev. 2018;27:127–143. wileyonlinelibrary.com/journal/beer V

C2017 JohnWiley & Sons Ltd

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Received:20 March 2017

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Revised: 13 November2017

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Accepted:19 November 2017

DOI: 10.1111/beer.12176

her business as a reflection of his/her values and priorities (Coppa &

Sriramesh, 2013; Marcus et al., 2015; Quinn, 1997), his/her professio-

nal behavior is also linked to his/her understanding of economic pres-

sures (De Clercq & Voronov, 2011; Margolis & Walsh, 2003; Pache &

Santos, 2010).Thus, in the business context, the presenceof a manager

with moral valuesthat are in harmony with CS values does not exclude

more pragmatic considerations (Jenkins, 2006, 2009; Lee, Herold, &

Yu, 2016; Murillo & Lozano, 2006) that necessarily involve awareness

and the weightingof economic stakes.

In this context, several researchers have shown that a manager’s

perceptions of the economic advantages of corporate social practices

impact his/her strategic decisions regardingCS commitment (Brammer,

Hoejmose, & Marchant, 2012; Cassels & Lewis, 2011; Gadenne,

Kennedy, & McKeiver, 2009), as do his/her perceptions of the charac-

teristics of the external environment (Bansal & Roth, 2000; Roxas &

Coetzer, 2012; Sharma, 2000). Thus, economic advantages stemming

from CS practices anda business context that is perceived as favorable

can make a manager more likely to initiate responsible behavior,

although the inverse is also true (Baden & Harwood, 2013; Campbell,

2007; Williams& Schaefer, 2013).

The general objective of this article is to specify the relationship

between a manager’s values (as reflected in his/her personal sustain-

ability behaviors[PSB]) and CS practices based on observations of 135

French SMEs. Specifically, we address the following research

questions:

To what extent are the manager’s PSB related to the firm’sCS

practices?

Do the perceived economic advantages of CS practices and/or the

perceived hostility of the business environment moderate this

relationship?

The aim of this research is to contribute to and fill several gaps in the

previous literatureon three main levels. First, this research contributes

to the debate on the convergence between personal values and sus-

tainable organizational practices, particularly in SMEs. Although it may

seem logical to assume a certain coherence between personal and

organizationalvalues and the behaviors of managers with regard to CS

(Battisti & Perry, 2011; Cassels & Lewis, 2011; Marcus et al., 2015),

this relation remains controversial and cannot be regarded as a fait

accompli in the literature (Cassels & Lewis, 2011; Reyes-Rodrigues,

Ulhøi, & Madsen, 2016; Roxas & Coetzer, 2012). Scholars who have

studied this question have typically focused on a single aspect of sus-

tainability (i.e., the environmentalaspect). Furthermore, they have typi-

cally measured the statistical relationship between personal attitudes

and professional behavior (e.g., Cassels & Lewis, 2011; Gadenne et al.,

2009; Roxas & Coetzer, 2012; Schaper, 2002). However, it has been

shown that attitud es can be “a poor predictor of specific behavior”

(Battisti & Perry,2011, p. 173).

Second, littleresearch has focused on the specific businessrealities

that SME managers must face when making decisions in terms of CS

(Chass

e & Boiral, 2016; Ditlev-Simonsen & Midttun, 2011; Hahn &

Scheermesser, 2006). By definition, the operationalization of CS often

requires trade-offs(Angus-Leppan, Benn, & Young, 2010; Hahn, Figge,

Pinkse, & Preuss, 2010) between the individual and the organizational/

institutional levels. Managers may, therefore, find it necessary to

choose between their personal values and profitability constraints and

between economic needs and various institutional pressures to adopt

CS practices (De Clercq & Voronov, 2011; Pache & Santos, 2010).

Thus, they may become subject to conflicting institutional logics that

lead to both compromise and resistance behaviors (De Clerq &

Voronov, 2011; Oliver, 1991; Pache & Santos, 2010; Westermann-

Behaylo, Berman, & Van Buren, 2014). These situations, although not

uncommon, have not been sufficiently addressed in the literature (De

Clercq & Voronov, 2011; Hahn et al., 2010; Hahn, Pinkse, Preuss, &

Figge, 2015; Pache& Santos, 2013).

Third, integrating different levels of analysis answers the calls in

the literature to develop a better understanding of the critical antece-

dents of CS in business (Aguilera, Rupp, Williams, & Ganapathi, 2007;

Aguinis & Glavas, 2012; Baumann-Pauly, Wickert, Spence, & Scherer,

2013; Campbell,2007; Frynas & Yamahaki, 2016). Wethus propose an

analysis of how certain particularities at the organizational level (per-

ceived advantages) and the contextual level (perceived environmental

hostility) moderate the relationship between personal behaviors (the

individual level) and professional practices. In this manner, our model

(Figure 1) assumes that the foundations of CS in SMEs merge individ-

ual, organizational, and external factors(Frynas & Yamahaki, 2016).

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THE RATIONALES FOR CORPORATE

SUSTAINABILITY IN SMEs: FROM OWNER–

MANAGER VALUES TO PERCEIVED

SITUATIONAL FACTORS

2.1

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The key role of the owner–manager in adopting

CS practices by SMEs

The decisive role played by the manager with regard to integrating

CS in SMEs has been shown in many academic publications (e.g.,

Godos-Diez, Fernandez-Gago, & Martinez-Campillo, 2011; Murillo &

Lozano, 2006; Quinn, 1997; Spence & Rutherfoord, 2003). This is

hardly surprisinggiven that the manager is inextricably linked with his/

her organization and often acts as its fulcrum (Aragon-Correa et al.,

2008; Fuller & Tian, 2006; Quinn, 1997). The manager determines the

strategic orientations and practices that are implemented by his/her

SME on the basis of his/her objectives and values (e.g., Aragon-Correa

et al., 2008; Cassels & Lewis, 2011; Hammann, Habisch, & Pechlaner,

2009; Lee et al., 2016; Murillo & Lozano, 2006; Quinn, 1997; Roxas &

Coetzer, 2012). Thus, he/she can model his/her business in his/her

own image, whichlogically implies behavioral consistency between his/

her personal actions and the SME’s corporate actions in terms of CS

(Battisti & Perry, 2011; Cassels & Lewis, 2011; Coppa & Sriramesh,

2013; Marcus et al., 2015).In so doing, he/she takes on responsibilities

that may extend beyond mere financial objectives (Spence, 1999;

Spence & Rutherfoord, 2003). Several empirical studies of SMEs have

shown that managers implement ethical and socially responsible

actions without first considering financial gain and profit, instead

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CHASS

EAND COURRENT