Austin Okeke

Project title

The influence of institutional pressures on sustainability emphasis and SCM practices in the Nigerian oil and gas industry.

Supervisors

• Professor Christian Hicks

Contact

Email: a.okeke2@ncl.ac.uk

Project description

This research is motivated by shifting patterns of sustainability emphasis and the subsequent changes on their impact on SCM practises. The emphasis on sustainability has shifted dramatically in recent years. Early emphasis in the 1980s and early 1990s were primarily influenced by social pressure, which was convincingly explained by legitimacy drivers (Deegan 2002; Deegan et al. 2002; Lindblom 1993). The basis for emphasis has now shifted to the point where legitimacy is likely to be only one explanation for emphasis (Morhardt 2010).

One explanation for the shifting emphasis is a broadening of the business case for sustainability, beyond legitimacy, to include other advantages of such emphasis. These include marketing, which involves improving the company's competitive position; social, which involves dealing with stakeholder challenges; political, which involves reducing political pressure and regulation; and accountability, which involves the company's role in achieving sustainable outcomes (Solomon and Lewis 2002).

Another explanation is grounded in institutional theory (Higgins and Larrinaga 2014; Larrinaga 2007). According to institutional theorists, sustainability emphasis arises when organisations succumb to societal pressure that makes it ‘required,' ‘expected,' or ‘normal' in the sector in which they operate, rather than being deliberately initiated to accomplish specific business case objectives (DiMaggio and Powell 1991). These pressures may manifest themselves in a number of ways. ‘‘The impact of the institutional environment may be subtle, making its way into the organisation via rationalised myths, or indirectly such as an indictment on a felony charge," (Galaskiewicz 1991, p. 293).

As a result, institutional pressures may be regulatory, normative, or cognitive in nature (Scott 1995). Because of the possibility for reward or the fear of punishment, regulatory institutional pressures such as rules, regulations, or membership requirements impose coercive pressure and affect the adoption of SCM practises (DiMaggio and Powell 1983). Normative institutional pressures are founded on social agreement within a field on what is the "right thing to do" (Scott 1995, p. 51). Cognitive institutional pressures are the most subtle and have the most effect on organisational action because norms and behaviours become so ingrained that other ways of thinking and behaving are not even consciously explored. Managers behave because it is 'natural' for them to do so. The idea is that organisational activities, such as an emphasis on sustainability, are not consciously planned by managers, but rather are reactions to field-level expectations built up over time via interactions in a field. Managers may not always be aware that their behaviours are influenced by institutions, yet isomorphism occurs (Friedland and Alford 1991; Milne and Patten 1992). Milne and Patten (2002; Milne and Patten).

The purpose of this study is to clarify the emphasis oil and gas firms place on sustainability. We wanted a method that draws on previous sustainability research while also allowing us to concentrate particularly on the impact of these emphasises on SCM practises.