Mangement Control Systems

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Management Accounting Research 23 (2012) 205–223

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Management Accounting Research
journal homepage: www.elsevier.com/locate/mar

Configuring management control systems: Theorizing the integration of strategy and sustainability Jean-Pascal Gond a,∗ , Suzana Grubnic b,1 , Christian Herzig c,2 , Jeremy Moon c,3 a b c

Cass Business School, City University, 106 Bunhill Row, EC1Y 8TZ London, UK Loughborough University, School of Business and Economics, Loughborough, Leicestershire LE11 3TU, UK Nottingham University Business School, International Centre for Corporate Social Responsibility, Jubilee Campus, Wollaton Road, Nottingham NG8 1BB, UK

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Although organizations have embraced the sustainability rhetoric in their discourse and external reporting, little is known about the processes whereby management control systems contribute to a deeper integration of sustainability within organizational strategy. This paper addresses this gap and mobilizes a configuration approach to theorize the roles and uses of management control systems (MCSs) and sustainability control systems (SCSs) in the integration of sustainability within organizational strategy. Building on Simons’ levers of control framework, we distinguish two possible uses of a MCS and a SCS—a diagnostic use and an interactive use—and we specify the modes of MCSs and SCSs integration. We rely on these two core dimensions to identify eight organizational configurations that reflect the various uses as well as their modes of integration of SCS and MCS. We characterize these ideal-type configurations, explain their impact on the triple bottom line, and describe which mechanisms allow organizations to move from one configuration to another. In so doing, we highlight various paths toward sustainability integration or marginalization within organizations. Finally, we explain how our framework can support future research on the role of MCS and SCSs in the integration of sustainability within strategy. © 2012 Elsevier Ltd. All rights reserved.

Keywords: Management control systems Levers of control Integration Sustainability accounting Strategic management accounting

1. Introduction There is a growing consensus that ‘. . . there’s no alternative to sustainable development’ (Nidumolu et al., 2009, p. 57). This is from a variety of perspectives from concern with the role of human agency in climate change to new imperatives for achieving competitive advantage. Sustainability involves organizational strategic renewal (Hart,

∗ Corresponding author. E-mail addresses: jean-pascal.gond1@city.ac.uk (J.-P. Gond), s.grubnic@lboro.ac.uk (S. Grubnic), christian.herzig@nottingham.ac.uk (C. Herzig), jeremy.moon@nottingham.ac.uk (J. Moon). 1 Tel.: +44 01509 223126; fax: +44 01509 223960. 2 Tel.: +44 0115 8466617; fax: +44 0115 8468074. 3 Tel.: +44 0115 9514781; fax: +44 0115 8468074. 1044-5005/$ – see front matter © 2012 Elsevier Ltd. All rights reserved. http://dx.doi.org/10.1016/j.mar.2012.06.003

1995; Shrivastava, 1994) as well as the creation of new calculative practices which drive, for example, the development of carbon trading markets (Callon, 2009; MacKenzie, 2009) and sustainability accounting and reporting (Adams and Whelan, 2009; Gray, 2010). Accordingly, there have emerged alternative paradigms to financial profit maximization captured in such phrases as the ‘triple bottom line’ in which economic, social and ecological criteria of performance are expected to be integrated (Bansal, 2005; Elkington, 1997; Hopwood et al., 2010). Although many organizations have embraced the sustainability rhetoric in their external reporting and their mission statements (Newton and Harte, 1997), these reports may serve as ‘veils’ hiding activities (Deegan, 2002) whose sole purpose is the reconstruction of an eroded legitimacy (Banerjee, 2008; Gond et al., 2009). This sceptical view is nurtured by a...
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