BALANCED OR HARMONISED CONSIDERATION OF SOCIAL, ENVIRONMENTAL AND ECONOMIC INTERESTS

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SUSTAINABILITY IN PROJECT MANAGEMENT

The concept of sustainable development within the project management context has continuously evolved over the past decade highlighting various views over the fundamentals that processes and procedures should build on (see Table 1). One of the first contributors to this field was Lambuschagne & Brent (2004, p.104), who revised project management frameworks in the process industry to include two core principles of sustainable development, which are intragenerational and intergenerational equity. This highlights early endeavours of introducing the spatial and temporal element of sustainable development in project management practices. Despite the fact that the authors (2004, p.103) name only two out of the eight principles present in project management literature, their work briefly touches upon other sustainability related considerations to be made. Labuschagne & Brent (2004, p.107) argue that project evaluation criteria focuses on financial indicators with very limited questions on environmental factors and no mention of social factors. Therefore their contribution to the field is made through the development of a model to assess projects based on the triple bottom line definition of sustainability. Furthermore, as part of social sustainability, the authors (2004, p.107) highlight stakeholder participation as an important criteria to assess, while arguing that organisations need to be accountable for the impact they exert over the triple P.
In an attempt to relate sustainable development to project management while pointing out challenges and potentials to its implementation, Gareis et al. (2009, p.6) differentiate content-related definitions of sustainable development from process-related one. The authors argue that the former present less relevance to the study of sustainability integration in project management as they are focused on contents of projects and their results (eg. climate change, clean energy, public health, social inclusion) rather than the management of them. By contrast the latter provide for the guiding principles of sustainable development, which coincide with the fundamentals proposed by Labuschagne & Brent (2004, p.107) with an additional emphasis on values and ethics as well as risk reduction instead of accountability.
Influential publications that followed are dated from the past five years, these being triggered by an increasing interest in developing models that can break down the existing barriers between the two fields. In a PMI (Project Management Institute) study centered around assessing how eight sustainability principles can be considered in order to improve the quality of the project assignment and of the project management process, the authors (Messikomer et al., 2011, p.58)7 referred to a simultaneous and balanced
economic, ecologic and social orientation, as well as a temporal, spatial and value based orientation as principles that can offer possibilities and limits to sustainable development.
Following researches (Turner, 2010; Goedknegt & Silvius, 2012; Silvius et al., 2012; Gareis, 2013; Økland, 2015) build upon the aforementioned four principles identified by Massikomer et al. (2011, p.59), highlighting the core fundamentals that literature perceives as crucial for ensuring sustainability in projects and corresponding processes. An exception to this is Økland (2015, p.104) who disregards the principle of balancing and harmonising the people, planet and profit pillars as well as value and ethical considerations as fundamentals of sustainable project management. Nevertheless, the author stresses the importance of developing within the limits of the social, ecological and economic systems as these are interconnected and influence each other in a highly complex way. This fundamental is complemented with the spatial and temporal dimensions as well as with considerations about reducing risk and making an accurate risk assessment as part of preventing the occurrence of negative externalities over any of the three Ps.
In addition to the four fundamentals highlighted by Messikomer et al. (2011, p.59), other authors also referred to transparency and accountability (Goedknegt & Silvius, 2012, p.3; Silvius et al., 2012, p.39), stakeholder participation (Turner, 2010, p.169; Goedknegt & Silvius, 2012, p.3), risk reduction (Turner, 2010, p.169; Goedknegt & Silvius, 2012, p.3) and consuming income and not capital (Silvius et al., 2012, p.39). Goedknegt & Silvius (2012, p.3) make a separate consideration of transparency and accountability as well as stakeholders and participation, but given the significant overlap between the interpretation of these fundamentals as well as the suggestion of grouping them supported by the majority of the authors, the paper jointly discusses transparency and accountability as well as stakeholder participation.
The above argumentation highlights the existence of various opinions on the fundamentals of sustainable development in the context of project management. Since no previous research has brought the varying principles under one framework, the authors propose to give equal consideration to all eight principles identified in literature.

BALANCED OR HARMONISED CONSIDERATION OF SOCIAL, ENVIRONMENTAL AND ECONOMIC INTERESTS

The first to build a case for simultaneous and equal consideration of economic, environmental and social goals when delivering products and services was Elkington (1997, p.1). Through his work, he underlined that business objectives are inseparable from the environment and society in which organisations operate and thereby sustainable development needs to build on all three pillars concurrently. Environmental sustainability refers to keeping the natural capital intact. Social sustainability highlights the unity and continuity of the society with practices that allow people to work towards shared goals. Individual’s existential needs of health and well-being, nutrition, safety, educational and cultural expression should be met (Gilbert et al, 1996, p.11). Economic sustainability can be interpreted in terms of present generations performing economic activities without burdening future generations through the creation of liabilities (Schieg, 2009, p.316). An alternative definition states that economic sustainability occurs when the environmentally and socially sustainable solution is financially feasible (Gilbert et al, 1996, p.11). Several authors have since used the triple bottom line, also referred to as ‘Triple-P’ for people, planet, profit, in their interpretation of sustainability (Gareis et al., 2009, p.7; Massikomer et al., 2011, p.59; Silvius & Schipper, 2012, p.2; Gareis et al., 2013, p.135; Tufinio et al., 2013, p.93; Økland, 2015, p.104).
A literature review on sustainability in project management performed by Silvius & Schipper (2014, p.67) reported that 86% of 164 publications referred to the triple bottom line when conceptualising sustainability, but their consideration of the three pillars is different: 96% of the papers discuss the economic dimension, 89% discuss the social dimension and 86% discuss the environmental dimension. Previous findings further support the occasional ignorance of the social and environmental dimensions of sustainability (Labuschagne & Brent, 2004; p.107; Labuschagne et al. 2005, p.378; Silvius et al. 2013, p.10) which can be explained by organisational endeavour to primarily compensate and reward investors’ capital (Martens & Carvalho, 2013 p. 3). Additionally, the level of consideration of the three pillars differs in projects based on the macroeconomic climate of a country. For example, projects show a bigger emphasis on environmental concerns in Western Europe as compared to a prevalent social consideration in Africa (Silvius & Schipper, 2010, p.2). Along the same line, current project management guides, such as PMBOK (PMI, 2013, p.141-254), still place an emphasis on the delivery of projects within the constraint of time, cost and scope, also referred to as the iron triangle (Silvius et al, 2012, p. 38). Despite the fact that the success of projects has started to be assessed using multiple criteria, additional considerations are still not reflected in practice as the triple-constraint drives project managers’ attention on the profit ‘P’. Hence, the social and environmental pillars get less attention (Labuschagne & Brent, 2004; p.107; Silvius & Schipper, 2010, p.3).
Nevertheless, the economic, environmental and social dimensions of sustainability need to be seen as interrelated as they are influencing each other in different ways (Silvius et al, 2012, p. 38; Silvius & Schipper, 2014, p. 69; Goedknegt & Silvius, 2012, p. 3). Their balance and harmonious relationship can be perceived either as a reactive or proactive approach to sustainability. Whilst the former intends to compensate for negative effects of doing business, the latter focusses on creating9 good effects from the start. Examples are compensating unhealthy working conditions by higher salaries and moving to more sustainable business processes that eliminate the cause of unsustainability, respectively (Silvius, 2012, p. 3).
Whilst signs of an endeavour towards balancing people, planet and profit considerations when planning and delivering projects are already present, evidence suggests that the economic pillar still prevails in project management decisions and practices. The authors believe that a proactive approach towards harmoniously combining the three pillars is needed and hence would like to explore the application of it in project management thereby leading to the hypothesis:
H1: The principle of balanced or harmonised social, environmental and economic interests is not applied in project management.

LOCAL, REGIONAL AND GLOBAL ORIENTATION

Globalisation has gained companies access to international markets and simultaneously increased their influence over multiple geographic areas. As a result, their activities are influenced by international stakeholders regardless of their national or international orientation (Silvius et al., 2012, p.38-39; Silvius & Schipper, 2014, p.69). Alike permanent organisations, projects, which are temporary organisations, are also part of and impact the economic, environmental and social processes at various spatial levels (Hollin, 2001, p.402). For instance, a company outsourcing part of the supply chain of its project to other countries will need to take into consideration the working conditions of that specific country, which can be seen as a global orientation. By contrast, consultation with stakeholders from the local community about externalities of a project that can affect their living conditions can be seen as a local approach (Silvius et al., 2012, p.50).
To tackle the challenges presented by these highly interrelated networks of processes and organisations and to assure intra-generational equity (Labuschagne & Brent, 2004; p.104) sustainable development has to be coordinated across all levels ranging from global to regional and local (Massikomer et al., 2011, p.59; Goedknegt & Silvius, 2012, p. 3; Gareis et al., 2013, p.135; Marcelino-Sadaba et al., 2015, p. 8; Økland, 2015, p.104) and institutional responses have to address corresponding problems (Gareis et al., 2009, p. 7).
Since projects are part of a global system of interrelated organisations, the consideration of the triple-bottom-line at local, regional and global levels has been agreed to be essential in order to deliver sustainable projects. Nevertheless, evidence of its considerations in practice is limited, hence the authors aim to assess how this principle has been adopted by project management processes thereby leading to the hypothesis:
H2: The principle of having a local, regional and global orientation is not applied in project management.

SHORT-TERM AND LONG-TERM ORIENTATION

Sustainability is often studied as prudent resource utilisation and points out the need for movement from rapid improvement events10 (RIE) to sustainable improvement events (SIE) in project management processes (Badiru, 2010, p.31) by giving equal consideration to both short and long-term consequences (Silvius & Schipper, 2014, p.69). Sustainability in the short-term provides solutions to a limited problem and in the long-term present’s solution pertaining to a wider set of challenges (Okland, 2015, p.107). Von Carlowitz, in the eighteenth century, viewed forest management from a long-term intergenerational perspective to balance wood consumption and reproduction, which can be seen as the earliest consideration of the temporal aspects of sustainability (Eskerod & Huemann, 2013, p. 38). Since then, sustainable development literature has emphasised the importance of aligning long-term strategic management with short -term project management needs (Herazo et al., 2012, p. 86), which subsequently may build reputation for project-based organisations (Schieg, 2009, p. 318).
While strategic plans can be executed using project management tools, incorporating sustainability in projects requires the adoption of systems such as Environmental and Social Management Systems that equally concentrate on the long and short -term consequences (Sánchez & Vanclay, 2012, p.1). Case studies on construction, built environment and technology industries have shown the adoption of sustainable project management practices to build long-term value (Brent et al., 2005, p.631; Eid, 2002, p.1; Herazo et al., 2012, p.84; Al-Saleh & Taleb, 2010, p.52). However, firms listed on the stock market still tend to focus on short-term gains rather than a long-term vision. Additionally, in the economic perspective, discounted cash flows hold more significance than future cash flows thereby showing an inclination towards short-term gains and an inconsideration for long-term consequences (Silvius, 2013, p. 58).
The integration of the long and short-term orientation is often considered to be stretching the domains of project management as projects are temporary endeavours and project management practices inherently concentrate only on the project lifecycle (initiation, planning, execution, control and close-out) that once completed hold no continuation in value for the organisation (Silvius & Schipper, 2012, p.38). By focusing on the project’s end result called the asset, the product or service produced by the asset and their corresponding lifecycles apart from the project lifecycle (Labuschagne & Brent, 2005, p.162) strategic alignment can be ensured. It is the permanent organisation that is seen to provide the long-term orientation through its vision, mission, strategy (Messikomer, 2011, p.70). It can be argued that the boundary between the permanent and temporary organisation is slimming from a strategic alignment perspective, especially in project-based organisations and projects initiate investments, the benefits of which are realised only in the long-term. For example, project benefits like client retention, stakeholder satisfaction and cost savings are obtained only once the project has been completed (Silvius & Schipper, 2012, p.38; Messikomer, 2011, p.70; Gareis et al., 2009, p.9; Gareis, 2013, p.16). It’s often suggested that the long-term view should be presented by the stakeholders involved (Goedknegt & Silvius, 2012, p.8). This strengthens the case for the integration of the short and long-term aspects in project management calling for a focus on the project, asset and product lifecycle concurrently.
With only a handful of industries seen to practice sustainability through this dimension and with minimal studies over the barriers, the authors aim to examine if the dimension is integrated in project management practices thereby leading to the hypothesis:
H3: The principle of having short-term and long-term orientation is not applied in
project management. 11

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VALUES AND ETHICS CONSIDERATION

A unified value driven, ethical approach practiced by the organisation and its stakeholders is found to be an important consideration for integrating sustainable development in project management practices (Mishra et al., 2011, p.338). Sustainable development, a normative concept, reflects the values and ethical considerations of the project managers, the organisation they belong to and the client (Silvius & Schipper, 2014, p.69; Gareis et al., 2009, p.6; Goedknegt & Silvius, 2012, p.3). ‘Values’ underpin the attitudes and behaviours of project managers and team members. ‘Ethics’ are imbibed in the organisational culture as norms and rules that focus on imparting fairness and solidarity both inter and intra-generations, to strive for inclusion, participation, traceability and trust (Eskerod & Huemann, 2013, p.39-41) and/or to set up practices of integrity, credibility and reputation (Schieg, 2009, p.315). While the two concepts of ‘values’ and ‘ethics’ are rather broad, multiple authors consider it to be the way we view things rather than do things (Silvius, 2013, p. 58).
Projects and project managers form the medium through which ethical considerations are practiced (Messikomer et al., 2011, p.36). However, these are affected by the project context and the personal values of the project manager (Silvius & Schipper, 2012, p.39; Gareis, 2013, p.2). Due to the capitalist environment that businesses thrive in and the economic interest driven definition of success, malpractices are frequently sought to by project stakeholders. Such malpractices often lead to negative outcomes such as resource depletion, business bankruptcy, economic recession, species extinction, political tension and others (Mishra et al., 2011, p.338).
In order to instill ethics and similar values in project managers, professional bodies for management have written down codes of conduct and ethics and have formalised their awareness through training programmes and certifications. While these codes address the interactions between a project manager and the different stakeholders and organisations, Article 2.2.1. of the PMI ® Code of Ethics and Professional Conduct makes explicit the environmental and societal facet in the decisions made by the project manager (Silvius & Schipper, 2012, p.39-40).
Although this dimension of sustainable development has been addressed in literature, its practice seems utopic, requiring a mutual agreement amongst organisations, project managers and stakeholders on the required business trade-offs to deliver all projects sustainably. Thus the authors aim to map the ethical and value considerations made by organisations, the subsequent business trade-offs and respective benefits that are achieved, which ensure the successful practical application of this dimension. The resulting hypothesis to be tested is:
H4: The principle of integrating values and ethics consideration is not applied in project management.

TRANSPARENCY AND ACCOUNTABILITY CONSIDERATION

Another dimension of sustainability considered for project management practices is transparency and accountability. Transparency refers to the avoidance of a black-box methodology and disclosure of the policies,12 decisions, activities and the subsequent environmental and societal impact of these. It also involves a “clear, accurate and complete portrayal, to a reasonable and sufficient degree”, of all the above (Hemphill, 2011, p.307). This allows stakeholders to evaluate and address any arising potential issues thereby contributing to an adherence to sustainable practices (Silvius & Schipper, 2014, p.69).
Transparency in the context of project management implies that project managers disclose all decisions, relevant events and impacts to stakeholders. However, the presence of an organisational structure with formal reporting protocols makes this dimension rather difficult to adhere to. Often the goal of such structures is to influence the perception of the stakeholder on the project, which can be seen as logical. However, with multiple stakeholder groups including the government and society, transparency can enforce the delivery of all projects sustainably (Silvius, 2013, p. 58).
Accountability as a sustainability dimension implies that an organisation owns the impacts of its actions, decisions and policies on the environment and society (Silvius & Schipper, 2014, p.69). Additionally, this dimension calls for actions to prevent the recurrence of negative impacts on the environment and society in the future (Hemphill, 2011, p.307). In project management practices the Organisation Breakdown Structure (OBS) assigns tasks to an individual and makes them accountable for it. While the accountable is usually questioned when the activity performs poorly on the cost, time, quality and scope criteria, it is important that the person be held responsible from the triple-bottom-line perspective. Thus it calls for an integration of the environmental and social indicators in work progress reports (Silvius & Schipper, 2012, p.39).
The authors of the study consider the transparency and accountability dimension of sustainability to be a subset of the values and ethics dimension. Nevertheless, the authors do not consider the practice of one dimension to imply the practice of another and vice versa. Thus it is interesting to see how project managers practice accountability and transparency in conjunction with the values and ethics dimension thereby leading to the hypothesis:
H5: The principle of integrating transparency and accountability consideration is not applied in project management.

RISK REDUCTION

Risk in project management is often referred to either as an opportunity or a challenge (Caron, 2013, p.51). Given this, risk reduction refers to the minimisation of the negative impacts of project management interactions and decisions on the environment, society and income required to assure financial sustainability (Turner, 2010, p.169; Okland, 2015, p.106). The Deepwater Horizon oil-spill is one such example where societal and environmental risks were high and due to inappropriate management led to a disaster (Silvius & Schipper, 2014, p.70). The indeterminacy, complexity, nonlinearity and irreversibility of the society – environment interactions, make it easier to prevent rather than ameliorate adverse impacts leading to the formulation of the precautionary principle (Gareis et al. 2009, p.10; Goedknegt & Silvius, 2012, p.3).
Project managers, when dealing with sustainability, future scenarios and evolutionary trends, face an unavoidable degree of uncertainty,13 ambiguity and ignorance thereby posing a significant challenge on how knowledge is produced, distributed and used (Giampetro & Ramos, 2005, p.123; Gareis et al., 2009, p.6). Given this and the success criteria of projects, which is mainly defined by the iron triangle, project managers are solely accustomed to considering risks pertaining to the unfulfilment of the financial success criteria. Hence there is a need for the consideration and evaluation of risks associated to society and environment that can arise from the project.
The aim of the authors is to understand how project Risk Registers incorporate societal, environmental and financial threats and the corresponding precautionary procedures and response actions developed for the same thereby leading to the hypothesis:
H6: The principle of risk reduction is not applied in project management.

STAKEHOLDER PARTICIPATION

PMI (2013, p.30) defines stakeholders as “an individual, group, or organisation who may affect, be affected by, or perceive itself to be affected by a decision or activity”. With this definition in mind, stakeholder participation is needed to reach a consensus over the meaning of a sustainable product or process within the context of a specific project (Achterkamp & Vos, 2006, p.540) as well as over the indicators used to assess its sustainability (Singh et al., 2007, p.574). Stakeholder participation studies focus on various themes, each highlighting the need to implement this principle in project management practices (Marcelino-Sadaba et al., 2015, p.9) as it may encourage social and individual learning leading to an enhanced society, augmented citizens as well as a reduction of uncertainty resulted from imperfect informatoin (Gareis et al., 2009, p.8).
To gain stakeholder participation, Porter & Kramer (2011, p.65-68) stresses the importance of creating shared value amongst stakeholders, arguing that prioritising shareholders’ short-term gains may result in the delivery of unsuccessful projects in terms of value delivered, which is unsustainable in itself. Thomson et al. (2009, p. 991) discuss the different types of knowledge on sustainability held by stakeholders, while Tam et al (2007, p.3106) contribute with a communication-mapping model stressing the need for better cooperation between project participants. Labuschagne & Brent (2004, p.102) proposes evaluating the standard of information sharing and the degree of stakeholder influence as part of project evaluation criteria. Singh et al. (2007, p.570) calls for the involvement of stakeholders when setting sustainability assessment rates. Thabrew et al. (2009, p. 69) believe that intersectional integration of projects is needed to meet sustainability targets. De Brucker (2013, p. 129) emphasises the importance of involving different stakeholders in decision-making, as not enough consideration is given to those groups that are key at only particular moments of the project.

Table of contents :

CHAPTER 1. INTRODUCTION
1.1 CHOICE OF SUBJECT
1.2 THEORETICAL BACKGROUND AND KNOWLEDGE GAPS
1.3 RESEARCH QUESTION
1.4 PURPOSE
CHAPTER 2. THEORETICAL FRAMEWORK
2.1 SUSTAINABILITY IN PROJECT MANAGEMENT
2.2 BALANCED OR HARMONISED CONSIDERATION OF SOCIAL, ENVIRONMENTAL AND ECONOMIC INTERESTS
2.4 SHORT-TERM AND LONG-TERM ORIENTATION
2.5 VALUES AND ETHICS CONSIDERATION
2.6 TRANSPARENCY AND ACCOUNTABILITY CONSIDERATION
2.7 RISK REDUCTION
2.8 STAKEHOLDER PARTICIPATION
2.9 CONSUMPTION OF INCOME AND NOT CAPITAL
2.10 CONCLUSION
CHAPTER 3. METHODOLOGY
3.1 RESEARCH TYPE
3.2 LITERATURE SEARCH
3.3 RESEARCH PHILOSOPHY
3.3.1 Ontology
3.3.2 Epistemology
3.3.3 Axiology
3.4 RESEARCH APPROACH
3.5 METHODOLOGY
3.6 RESEARCH STRATEGY
3.7 TIME HORIZON
3.8 DATA COLLECTION AND ANALYSIS
3.8.1 Data collection method
3.8.2 Data sampling
3.8.3 Data analysis
3.9 ETHICAL CONSIDERATION
3.10 PRACTICAL METHOD
3.10.1 Interview guide
3.10.2 Conducting the interview
3.10.3 Transcribing the interview
3.10.4 Research process
3.11 QUALITY CRITERIA
CHAPTER 4. EMPIRICAL FINDINGS AND ANALYSIS
4.1 CASE STUDY INTRODUCTION
4.1.1 Case Study I – Pharmaceutical drug testing
4.1.2 Case Study II – IT solution development
4.1.3 Case Study III – Automobile component packaging solution
4.1.4 Case Study IV – Railway electronics design and delivery
4.1.5 Case Study V – Furniture manufacturing for office space
4.1.6 Case Study VI – 100% sustainable coffee production
4.2 EMPIRICAL FINDINGS
4.2.1 Balanced or harmonised consideration of social, environmental and economic interests
4.2.3 Short-term and long-term orientation
4.2.4 Values and ethics consideration
4.2.5 Transparency and accountability consideration
4.2.6 Risk reduction
4.2.7 Stakeholder participation
4.2.8 Consumption of income and not capital
4.2.9 Redefining sustainability in project management
4.3 EMPIRICAL ANALYSIS
4.3.1 Balanced or harmonised consideration of social, environmental and economic interests
4.3.3 Short-term and long-term orientation
4.3.4 Values and ethics consideration
4.3.5 Transparency and accountability consideration
4.3.6 Risk reduction
4.3.7 Stakeholder participation
4.3.8 Consumption of income and not capital
4.3.9 Redefining sustainability in project management
CHAPTER 5. CONCLUSIONS AND RECOMMENDATIONS
5.1 CONCLUDING REMARKS
5.2 MANAGERIAL IMPLICATIONS
5.3 THEORETICAL CONTRIBUTIONS
5.4 LIMITATIONS
5.5 RECOMMENDATIONS FOR FUTURE RESEARCH
REFERENCE LIST
APPENDICES
Appendix 1 – Consent form.
Appendix 2 – Interview questions
Appendix 3 – Interview guide
Appendix 4 – Thematic guide

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