The interdependence of management control systems and conflict resolution between sustainability and profitability : a case study of Grieg Star

Abstract

With a foundation from the extensive literary debate on the profitability of sustainability, this study will look into how an organisation can achieve a triple bottom line. Companies are seeking advice on how to manage the increased sustainability demands from institutions, and the maritime sector is no exception. The purpose of this study is to contribute with valuable insight on the concept of conflict management between sustainability and profitability. Hence, the research question this study aims to answer is how are the management control systems in an organisation influencing, and being influenced by, the managers’ approach to solving conflicts between sustainability and profitability? To investigate the research question there is a need for in-depth data. Therefore, we have conducted a single case study of Grieg Star, with primary data gathered from seven semistructured interviews of managers and employees. Secondary data, such as annual reports and information from websites, has enabled a longitudinal time horizon. In addition, an interview with a maritime expert from the Norwegian University of Science and Technology (NTNU) has provided a valuable understanding of the industry. The study is structured in accordance with the Levers of Control framework. The empirical findings indicate that compliance with internal policies is a high priority in Grieg Star. In this regard, external institutions seem to have a strong influence on internal rules and policies concerning sustainability, while the financial policies originate from within the organisation. In terms of the control tool of measurements and targets, the quantifiable factors are given precedence over non-quantifiable factors. Furthermore, as part of a valuedriven company, the employees find guidance and motivation from the values that pervade the organisation. Discussions and opportunity seeking are also important tools at all levels in the organisation, leading to strong initiatives particularly towards sustainable development. Based on the empirical findings, it was discovered that the levers of control had an order of priority rather than a balanced use in Grieg Star. Furthermore, we found that cognitive integration of the control tools is crucial to achieve a balanced prioritisation of sustainability and profitability in an organisation. Our findings suggest that companies should be aware of the order of priority and cognitively integrate the management control tools to achieve a successful triple bottom line.