Leading corporate sustainability: The role of top management team composition for triple bottom line performance

• Published in: Business strategy and the environment Vol. 28; no. 1; pp. 173 - 184
• Main Authors: Henry, Leona Aimée, Buyl, Tine, Jansen, Rob J.G.
• Format: Journal Article
• Language: English
• Published: Chichester Wiley Periodicals Inc 01.01.2019
• Subjects: chief sustainability officer; Composition; Corporate structure; corporate sustainability; Financial performance; Functional morphology; Sustainability; Sustainability reporting; Sustainable development; Teams; TMT diversity; Top management; top management team; Triple Bottom Line; triple bottom line performance
• ISSN: 0964-4733; 1099-0836
• DOI: 10.1002/bse.2247

Sustainable development at the corporate level requires balancing social, environmental, and financial performance goals. Achieving such “triple bottom line” (TBL) performance is a very challenging task. In this study, we explore the role the organization's top management team (TMT) plays in leading their organization towards corporate sustainability. We focus on how two distinct aspects of the TMT's structural composition—the presence of a “chief sustainability officer” (CSO) and the TMT's functional diversity—affect the organization's ability to reach high levels of TBL performance. We follow the presence of 22 global energy companies in Corporate Knight's “Global 100” sustainability index for a period of 11 years and find that, surprisingly, the presence of a CSO does not boost TBL performance. However, we do find a positive effect for TMT functional diversity, suggesting that more diverse TMTs are better able to lead their organization to higher levels of TBL performance.