Navigating Sustainability: Unveiling the Role of Controllers in Organizations - A qualitative interview study of three global organizations

Abstract

Background and problematization: The pressing environmental challenge at hand demands significant changes and a stronger commitment to sustainable actions. Integrating sustainability goals into organizations has therefore become crucial, causing organizations to balance new objectives with institutionalized values. Controllers within an organization can play a pivotal role in this transformation, evolving from traditional scorekeepers to strategic business partners involved in decision-making. However, research on controllers’ connection to sustainability initiatives is limited, necessitating further investigation. The expanding role of controllers includes handling non-financial values and sustainability data, potentially causing tension requiring deeper empirical research for a comprehensive understanding of their evolving role in sustainability transformation. Purpose: The purpose of the master thesis is to investigate how the role of controllers changes in a dynamic business environment in regard to sustainable development. Research questions: “How does the implementation of sustainable value in organizations affect the role (archetypes) of controllers?” and “What are the main barriers for controllers to integrate the sustainability logic, and how do they manage them?” Methodology: The master thesis is a qualitative interview study where 14 semi-structured interviews were conducted with three different organizations. 12 respondents were controllers and two respondents were sustainability directors. The study uses a thematic analysis with the lens of institutional logics and different archetypes of controllers. Conclusion: This study concludes that there are several factors influencing how controllers are affected by sustainability. The first and most significant factor is the level of strategic involvement of controllers. In addition, both firm- and industry characteristics and individual traits of controllers affect how and if sustainability is included in the daily work. Hence, there exist large differences both between, and within, organizations. This study provides an additional logic besides sustainability and profitability values in the organization that acts as a counterbalance between the two logics, i.e. the customer logic. This master thesis further highlights several barriers for controllers to work with sustainability and how to potentially overcome them. Task overload, insufficient knowledge of sustainability, the tension between sustainability and profitability, and the long tradition of prioritizing profitability are some acknowledged barriers. Moreover, digitalization is considered an enabler to achieve a shift towards including more values such as sustainability. Finally, the study underscores the imperative for ongoing improvement and recognition that the integration of sustainability is a gradual process, not achievable overnight.