Sustainable Development

Sust. Dev. 18, 71–75 (2010)

Published online in Wiley InterScience
(www.interscience.wiley.com) DOI: 10.1002/sd.452

Strategic Thinking for Sustainable Development

Rupert J. Baumgartner1–3* and Jouni Korhonen1,3,†
1
Åbo Akademi University, Turku, Finland
2
University of Leoben, Austria
3
International Sustainable Development Research Society (ISDRS)

ABSTRACT
The idea of this editorial research article is to start making sense out of the seemingly
limitless debate on the environmental dimension of sustainable development. We have
evaluated a collection of international peer-reviewed papers. These contributions have been
debated at the conferences of the International Sustainable Development Research Society
(ISDRS). Our main research objective here is to consider the often posed question of why
the progress made in sustainable development has been so slow and the work implemented
so unsuccessful. We argue that one of the main explanations is that the approaches used
in sustainable development are reductionist and often lead into problem shifting and
problem displacement. To address the problem of reductionism, we propose what we call
‘strategic thinking’ and its incorporation into sustainable development work in general. To
open up this argument, we arrive at the discussion of three central dimensions of strategic
thinking and the relevance of these dimensions when addressing reductionism. These
dimensions are the strategy content, strategy process and strategy context. Copyright ©
2010 John Wiley & Sons, Ltd and ERP Environment.

Keywords: sustainable development; reductionism; problem shifting; strategic sustainable development; strategy content;
strategy process; strategy context

Introduction: Research Objective

R
OOME (2001) PRESENTS ENVIRONMENTAL PROBLEMS AS ‘METAPROBLEMS’. METAPROBLEMS ARE COMPLEX PROBLEMS
and constitute of a set of subproblems that are also complex problems. Solving a metaproblem requires
subproblem solution on the micro-level of the system in question without simultaneously creating new
problems in other micro-level subsystems or on meso and macro-levels.
For this special issue, ‘Strategic Thinking for Sustainable Development’, we have gathered a collection of inter-
national peer-reviewed papers. Prior to publication, these papers have been debated at the conferences of the
International Sustainable Development Research Society (ISDRS). Our main research objective here is to consider
the often posed question of why the progress made in sustainable development has been so slow and work imple-
mented so unsuccessful. We argue that one of the main explanations is that the approaches used in sustainable
development are reductionist and often lead into problem shifting and problem displacement. To address the
problem of reductionism, we propose what we call ‘strategic thinking’ and its incorporation into sustainable

* Correspondence to: Dr. Rupert J. Baumgartner, Åbo Akademi University, Turku, Finland. E-mail: Rupert.Baumgartner@abo.fi
†
The order is alphabetical. Contributions are equal.

Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment
72 R. J. Baumgartner and J. Korhonen

development work in general. To open up this argument, we arrive at the discussion of three central dimensions
of strategic thinking derived from the mainstream of strategic management literature and the relevance of these
dimensions when addressing the problem of reductionism. These dimensions are the strategy content, strategy
process and strategy context.

Problems and Shortcomings of Sustainable Development

Problem Displacement, Problem Shifting and Reductionism

It is amazing how little practical improvement has been achieved in sustainable development in the everyday
functioning of various organizations, national, regional and international policies or within different communities.
We argue that much could be achieved if all actors and designers of the diverse tools and instruments would pause
for a while to (re)consider the basics and the fundamentals of what this work should be all about and what the
overall direction of the work is.
Management of a complex dynamic system includes many risks, e.g. developing actions and measures that are
conflicting with each other and suboptimal in terms of the improvement of the system. Examples of work that is
not strategic, i.e. work that does not serve the overall purpose of the work, are many in sustainable development
projects. We argue that the main problem in all sustainable development work is what can be called ‘reduction-
ism’, ‘problem displacement’ or ‘problem shifting’ in terms of space, time and knowledge transfer. The fact that
the focus of all sustainable development work, ‘society within a biosphere’, is a complex and dynamic system has
not been properly understood. This failure can be termed as ‘reductionism’ (Huesemann, 2001). System-wide
cause-and-effect chains are not considered. Isolated cause-and-effect chains between two system components are
the focus of study, neglecting connections to other components. Reductionism leads to situations where existing
problems are handled within a certain system while new problems are created elsewhere in this system or in its
subsystems or in the future of the same system.
Sustainable development is a global and long-term challenge. Carbon emissions, regardless of where they are
emitted, contribute to climate change effects, which may pertain over many decades (Huesemann, 2001). Energy
intensive industries can move from environmentally aware and legally binding locations to locations that are less
environmentally aware and legally undeveloped. Until recently, environmental policies were defined based on
environmental media. Air, land and waterborne emissions had their own distinct categories. Product-based policies
have now replaced these policies that focused on production and on to the individual environmental media where
emissions were detected. However, the system boundary problem still persists, e.g. countries, multinational com-
panies or life cycles of products are all very challenging to monitor or to juristically or economically determine and
govern in a balanced manner.
Problem displacement and problem shifting occur in knowledge transfer, too. More and more new sustainability
tools and instruments are developed that provide new information to the tool-user, a business leader or a policy-
maker. New acronyms such as MFA, SFA, LCA, MIPS, EFP, EMS etc. are presented. This creates confusion:
‘Which tool is the best for my particular problem?’ (Robèrt et al., 2002). The question should be how to use these
well developed tools and instruments/approaches in parallel and together, to serve as each other’s complements
in the course toward more sustainable global societies.

Addressing Reductionism with Strategic Thinking

Strategic management was established as an academic field, e.g. with such contributions as the publication of
Schendel and Hofer (1979). Strategic management is still characterized through many different definitions (Nag
et al., 2007). Nag et al. (2007) identified a consensus definition for strategic management based on an analysis of
strategic management journals: ‘The field of strategic management deals with the major intended and emergent
initiatives taken by general managers on behalf of owners, involving utilization of resources, to enhance the

Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 18, 71–75 (2010)
DOI: 10.1002/sd
Strategic Thinking for Sustainable Development 73

performance of firms in their external environments’ (Nag et al., 2007). Strategy consists of three distinguishable
dimensions, the strategy process, the strategy content and the strategy context.
The starting point for every strategy is the question of purpose of the whole endeavor. This is the input for
strategy activities. The dimension of strategy process is the way to develop the strategy, i.e. the throughput (the
how, who and when of strategy). The strategy content is the output of the strategy, i.e. the result of strategy activi-
ties. Conditions surrounding strategy activities are the strategy context, which has an influence on the possibilities
and restrictions of strategic activities. Strategy process, content and context are not different parts of strategy, but
they are distinguishable dimensions (De Wit and Meyer, 2004). We shall later refer to these three interrelated and
distinct dimensions of strategic sustainable development.
When any work is performed in a strategic manner, all individual activities serve a common purpose, common
for the whole set of the activities in this work. All actors and their actions contribute to a common vision, an overall
goal. The actors and their activities do not go in different directions, nor are they competing.
Two new approaches in the literature have the potential to bring strategic thinking into sustainable development.
These approaches are helpful in preventing problem displacement and in designing future problems out of the
system. The Framework for Strategic Sustainable Development (FSSD) was proposed by pioneering sustainability
scientists (Robèrt et al., 2002). One of the most popular tools in the field of strategic management is the Balanced
Scorecard (BSC) introduced by Kaplan and Norton (1992). The BSC has also been adjusted to sustainability (see
later on in the paper).

Addressing Problem Displacement with Strategic Thinking: FSSD

FSSD addresses reductionism by outlining a five-level framework with which all sustainability approaches, activi-
ties and practical measures could be judged. All of the five levels in the framework must be considered together;
the levels are complementary (yet distinct). The model has a clear definition of the system under consideration
(Level 1) and an overall objective and vision to be pursued in the system (Level 2). The model includes strategic
principles (Level 3), which guide efforts towards the objective, and practical actions and concrete measures to
implement the strategy (Level 4). Indicators and metrics measure the success of the actions (Level 5). The success
of practical measures and concrete actions (Level 4) is evaluated with indicators (Level 5) against the strategic
principles (Level 3) and the overall objective and vision (Level 2) for their contribution to the system under focus
(Level 1).1

Addressing Problem Displacement with Strategic Thinking: SBSC

Business practice has implemented the BSC concept widely and several case studies have showed the usefulness
of the BSC for business strategy (for example Butler et al., 1997; Ahn, 2001). The concept has been developed into
the Sustainability Balanced Scorecard (SBSC, Figge et al., 2002; Korhonen and Baumgartner, 2009). SBSC tackles
problem displacement by dividing the strategy of the project, firm, organization or community into four perspec-
tives. All the perspectives then serve a joint and shared strategic vision, an overall objective.

Answering the Research Questions

The ‘strategic thinking’ we propose in this editorial research article could initiate the combining of social science
theoretical and conceptual work to natural science tool, indicator, modeling and metrics work. Indeed, it seems
that the gap between the social science type of understanding and natural science/engineering has been one of
the main causes of fragmentation, reductionism and problem shifting in sustainable development. The practical

1
Since the FSSD theory is among the most often-cited texts in sustainable development research and since it is discussed in the other papers
of this special issue, we shall not use space for longer definitions of the concept in this editorial research article.

Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 18, 71–75 (2010)
DOI: 10.1002/sd
74 R. J. Baumgartner and J. Korhonen

tools and instruments have been designed in natural science/engineering while the theoretical and conceptual
basis of sustainability has been developed in social sciences (Binder, 2007). Based on our conceptual and theoreti-
cal exploration, we answer our research objective in this section.
We find that the complexity of the problem of unsustainable development has not been acknowledged. Individual
problems are dealt with separately in isolation from other unsustainability problems. The systems context of sus-
tainable development has not been properly taken into account. What we call ‘strategic thinking’ seems to be
missing from sustainable development work in general. We shall open up strategic thinking deriving from the
mainstream of strategic management literature (De Wit and Meyer, 2004). Three dimensions of strategy are par-
ticularly helpful when addressing the problem of reductionism and problem shifting: strategy content, strategy
process and strategy context.

Strategy Content
This dimension secures that the framework, approach or project in question contributes to sustainability. What is
the substance and the added value in light of sustainable development? Reductionist thinking fails to properly
consider this question as the problems and ‘blind alleys’ described above illustrate. Focusing on strategy content
means that one seeks to avoid these pitfalls; one is clear about the contribution attempted. The strategy content is
the substance of the constructed framework, approach or project (that is constructed in the process dimension;
see below).

Strategy Process
Strategy process outlines the way in which the entire strategy of the framework, approach or project in question
is formulated and constructed to achieve the intended content and purpose. It is important to include all primary
stakeholders, e.g. the managers, the tool developers or designers and the actors who implement the approach in
practice. Primary stakeholders should all be aware of the expected outcome of the project and they should have a
system understanding/awareness, not only understanding of their own subsystems or isolated system components.
In reductionist approaches reflected upon above, there seems to be confusion about what actors should actually
be included in the ‘category’ of primary stakeholders. Similarly, system understanding and awareness of the main
system in which the subsystem of certain individual actors is embedded is not properly taken into account in
reductionist approaches. From system understanding it should follow that actors know how to act and when to
act to contribute to the desired outcomes in the system under focus.

Strategy Context
The dimension of strategy context is about the perception of the secondary stakeholders. It is also important to
acknowledge the overall environment of the work in question, which always includes the larger socio-economic
environment, i.e. the cultural context, the political context, the regulatory context and the market context under
which the work must be performed. Reductionist policies and strategies fail to thoroughly consider this socio-
economic context in which all policies and strategies are embedded. This leads into dead-ends and into suggestions
that are not realistic or do not survive over the long term in societal development.

Introducing the Papers in the Special Issue

We believe that the four selected articles in this special issue, ‘Strategic Thinking for Sustainable Development’,
of Sustainable Development, which are described below, serve our cause of bridging strategic thinking and sense-
making to sustainable development work in general.
Baumgartner and Ebner discuss corporate sustainability strategies and propose a ‘maturity level’ system. To do
this, sustainability aspects relevant for corporate sustainability are identified and grouped into economic, ecological

Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 18, 71–75 (2010)
DOI: 10.1002/sd
Strategic Thinking for Sustainable Development 75

and social dimensions of corporate sustainability. Based on this, a four-level maturity system is developed, which
is used to evaluate different types of corporate sustainability strategy.
Gelbmann discusses strategic CSR in small and medium-sized enterprises. She focuses on the development of
an Austrian CSR quality seal, which enables small and medium enterprises (SME) to communicate their sustain-
ability performance effectively and is a visible sign for their stakeholders. This seal was devised to meet objections
to the application of standardized CSR tools, especially in SMEs.
Wikström differentiates, based on empirical studies, between three different approaches towards business sus-
tainability. This paper explores tensions exhibited within the use of sustainability in relation to organizational
activities such as strategic management and measurement or performance. The three different approaches identi-
fied are based on different standpoints; the author argues that this might result in misunderstandings and ambi-
guity. Finally, Dong and Burrit analyze benchmarking practices in the Australian Oil and Gas Industry. They
examine the social and environmental disclosures against general and industry benchmarks for the quantity and
quality of social and environmental reporting practice.
We hope for responses to the argument of this editorial research article and to the message of the special issue
as a whole. We encourage your responses for publication in Sustainable Development.

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Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 18, 71–75 (2010)
DOI: 10.1002/sd