Abstract:
This thesis investigates how and why sustainability integration of Management
Controls Systems (MCSs) varies in relation to companies' strategic approaches to
handling environmental and social issues. According to the extant literature,
sustainability issues remain decoupled from MCSs used for strategic management
purposes since academics and practitioners are more focused on developing
individual sustainability controls for compliance and disclosure requirements.
This study aims to close this research gap. In particular, it investigates how the
proactive, reactive and accommodative approach to sustainability influences the
integration of Sustainability Control Systems (SCSs) with regular MCSs. Further,
this research addresses the dearth of literature related to developing countries by
focusing on contingencies related to Sri Lankan manufacturing companies.
Building on Gond et al.'s (2012) scholarly work, a theoretical framework is
proposed relying on two dimensions: (i) the extent of control integration (strong
to weak) and (ii) the level of control complexity (complex to simple) of SCS and
MCS to explore their link to the strategic approach (proactive, accommodative
and reactive). A multiple case study was conducted using semi-structured
interviews with senior managers of five Sri Lankan companies. Thematic and
pattern analysis attested to the plausibility of each company with the
configurations. Findings present empirically plausible typologies of four control
configurations: complex-strong, complex-weak, simple-strong, and simple-weak.
The study finds that a company with a proactive strategic approach integrates
controls strongly while having complex attributes. In contrast, reactive companies
do not have a similar impetus for integration; thus, SCS remain decoupled from
MCS with simple control attributes. The accommodative approach explains the
interim combination of simple-strong and complex-weak configurations. It also
shows how contextual factors in developing countries like Sri Lanka play a critical
role in fostering or hindering the integration of sustainability into MCS and
strategy. The insights and recommendations provided in this thesis could attract
the attention of senior managers and policymakers in countries that share similar
corporate, contextual, and cultural structures.
