Accounting SUSTAINABILITY Univ.-Prof. Dr. Dorothea ...
Transcript of Accounting SUSTAINABILITY Univ.-Prof. Dr. Dorothea ...
JOHANNES KEPLER
UNIVERSITY LINZ
Altenberger Str. 69 4040 Linz, Austria www.jku.at DVR 0093696
Author Judith Frei, MMag.a
Submission Institute of Management
Accounting
First Supervisor Univ.-Prof.in Dr.in Dorothea
Greiling
Second Supervisor Ao. Univ.-Prof.in Dr.in
Michaela Schaffhauser-
Linzatti
June 2021
SUSTAINABILITY
REPORTING AND
MANAGEMENT
CONTROL SYSTEMS OF
UNIVERSITIES
Doctoral Thesis
to confer the academic degree of
Doktorin der Sozial- und Wirtschaftswissenschaften
in the Doctoral Program
Social Sciences, Economics & Business
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STATUTORY DECLARATION
I hereby declare that the submitted Doctoral Thesis has been written solely by me without any third-party assistance, information other than provided sources or aids have not been used and those used have been fully documented. Sources for literal, paraphrased and cited quotes have been accurately credited. This is a cumulative thesis and the present framework is based on the published articles. Duplications between the published articles and the framework exist. The submitted document here present is identical to the electronically submitted text document. Linz, June 2021 MMag.a Judith Frei
June, 2021 Judith Frei II/V
ACKNOWLEDGEMENTS
A number of people have kindly supported this dissertation project, to whom I would like to express my deep gratitude. First, I would like to sincerely thank my first supervisor, Univ.-Prof.in Dr.in Dorothea Greiling, for her continuous support, her ongoing encouragement, and the sharing of her expertise, with which she kept guiding me throughout the entire process. My gratitude goes also to my second supervisor, Ao. Univ.-Prof.in Dr.in Michaela Schaffhauser-Linzatti, and my third examiner, Ao. Univ.-Prof. Dr. René Clemens Andeßner. Furthermore, I want to express my gratitude to my colleagues of the Institute of Management Accounting, particularly Dr.in Melanie Lubinger, for the professional and personal exchange, and Ass.-Prof. Dr. Albert Traxler, for his professional and friendly support. I would also like to thank Mag.a Daniela Cortés, Astrid Eisner, Assoz. Univ.-Prof.in Dr.in Birgit Grüb-Martin, and Dr. Johannes Slacik for their collegial support. I am thankful to my interview partners for their friendly willingness to provide information. Finally, I am deeply grateful for the continuous support and motivation of my husband Markus and my beloved daughter Helena, who shared their time with me and showed much patience and loving understanding during this journey.
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TABLE OF CONTENT
List of Figures ...................................................................................................................................... V
List of Tables ....................................................................................................................................... V
Abbreviations ....................................................................................................................................... V
1. Motivation ..................................................................................................................................... 1
1.1. Sustainability reporting of universities .................................................................................... 3
1.2. Management controls systems of universities ........................................................................ 4
2. Positioning in the academic field and research questions ............................................................. 6
2.1. Systematic literature review ................................................................................................... 7
2.1.1. Prior research on materiality and sustainability reporting of universities ......................... 7
2.1.2. Prior research on stakeholder inclusiveness and sustainability reporting of universities11
2.1.3. Prior research on universities’ management control systems and institutional logics ... 13
2.2. Theoretical and conceptual approaches .............................................................................. 14
2.2.1. Strategic stakeholder theory ........................................................................................ 15
2.2.2. Sociological institutionalism ......................................................................................... 16
2.2.3. Institutional logics ........................................................................................................ 17
2.3. Research questions ............................................................................................................. 18
3. Epistemology and methodology .................................................................................................. 20
3.1. Epistemology ....................................................................................................................... 20
3.2. Methodology ........................................................................................................................ 20
4. Key results of the publications .................................................................................................... 22
4.1. Results: Sustainability reporting of universities .................................................................... 22
4.2. Results: Management control systems of universities .......................................................... 24
5. Integrated discussion, contribution to the academic debate, practical implications, and directions for further research ..................................................................................................................... 25
5.1. Integrated discussion ........................................................................................................... 25
5.2. Contribution to the academic debate, practical implications, and directions for further research .............................................................................................................................. 29
References ........................................................................................................................................ 32
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APPENDIX
Appendix 1 Paper One: Lubinger, M., Frei, J. and Greiling, D. (2019), “Assessing the materiality of university G4-sustainability reports”, Journal of Public Budgeting, Accounting & Financial Management, Vol. 31 No. 3, pp. 364-391. Declarations of co-authors Appendix 2 Paper Two: Frei, J., Lubinger, M. and Greiling, D. (2020), Assessing Universities’ Global Reporting
Initiative G4 Sustainability Reports in Concurrence with Stakeholder Inclusiveness, in Manes-Rossi, F. and Orelli, R.L. (Eds.), New Trends In Public Sector Reporting – Integrated Reporting and Beyond, Public Sector Financial Management, Palgrave Macmillan, Switzerland, pp. 35-56. Declarations of co-authors Appendix 3 Paper Three: Frei, J., Greiling, D. and Schmidthuber, J. (2020), “Management Control Systems in hybrid universities – The case of Austrian public universities”, Qualitative Research in Accounting and
Management (major revision) Declarations of co-authors Appendix 4 Publication and conference list
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List of Figures
Figure 1: Research fields of the dissertation Figure 2: Management control systems package (Malmi and Brown, 2008) Figure 3: Content-related foci of management control types Figure 4: Content-related foci (overlapped) of management control types Figure 5: Types of management control
List of Tables
Table 1: Overview of the papers, associated journals as well as publication status and conference presentations Table 2: Literature review on materiality and sustainability reporting of universities Table 3: Literature review on stakeholder inclusiveness and sustainability reporting of universities Table 4: Theoretical and conceptual approaches of the core publications Table 5: Overview of the methodological approaches of the core publications Table 6: Overview of the material dimensions and their coverage rates Table 7: Overview of the specific standard disclosures’ total coverage rates
Abbreviations
AC Administrative Controls CC Cultural Controls CYC Cybernetic Controls ERP Enterprise Resource Planning GRI Global Reporting Initiative HEI(s) Higher Education Institution(s) HESI Higher Education Sustainability Initiative ICR(s) Intellectual Capital Report(s) IFAC International Federation of Accountants IIRC International Integrated Reporting Council IRs Integrated Report(s) MAS(s) Management Accounting System(s) MC(s) Management Control(s) MCS(s) Management Control System(s) NGO(s) Non-Governmental Organisation(s) NPM New Public Management P Planning PMS(s) Performance Management System(s) RC Reward and Compensation RQ(s) Research Question(s) SE Stakeholder Engagement SI Stakeholder Inclusiveness SR(s) Sustainability Report(s) STARS Sustainability Tracking, Assessment, and Rating System TBL Triple Bottom Line (T)CR(s) (Total) Coverage Rate(s) UNGC United Nations Global Compact
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1. Motivation
Due to New Public Management (NPM) reforms, major neoliberal changes have found their way into universities over the past 30 years: removed from a relatively secure existence in stable markets with guaranteed government funding, they were released into internationalisation and entrusted with the responsibility to secure part of their own income (Parker, 2013; 2011). Although public funding has been decreasing, universities are still subject to governmental scrutiny (Guthrie and Neumann, 2007). Beyond that, market criteria require that university educational institutions compete for research grants, the best employees and students all over the world, as well as position themselves in international rankings. The “Humboldtian spirit” (Kallio et al., 2016:704) of freedom and autonomy in research and teaching seems to have been pushed into the background in favour of a more entrepreneurial attitude, shifting universities towards a new, market-driven culture. Universities meet these challenges in fulfilling their central missions of providing knowledge and an intellectual base for “social, economic, cultural, political, institutional and individual development” (Ntim et al., 2017:73). Teaching, research, interacting with society, and “co-creation for sustainability” (Trencher et al., 2014) represent universities’ traditional and new missions. In order to consolidate their roles in modern society, universities have to (re)consider the expectations of and relations with their various internal and external stakeholder groups (e.g., public administration, other funding organisations, teaching and research staff, students, employers, academic accreditation and quality agencies, Larrán Jorge et al., 2012). According to stakeholder theory (Freeman et al., 2010; Parmar et
al., 2010; Freeman, 1984), the relationships between organisations and their interrelated groups of stakeholders have to be considered to deal with “interconnected problems relating to business” (Parmar et al., 2010:4). Stakeholders play a crucial role and influence organisations’ long-term goals. Originally elaborated for business organisations, the stakeholder view can also be applied to universities striving for legitimacy and acceptance in society (Larrán Jorge et al., 2012). Furthermore, in terms of the availability of resources, universities have to meet the growing information needs of their prominent and growing number of stakeholder groups. In order to meet their responsibilities and to enhance effectivity and efficiency (Duh et al., 2014; Decramer et al., 2012; Melo et al., 2010; Van der Weijden et al., 2008) – i.e., in research (e.g., the number and quality of publications, conference presentations, research projects, scientific community services), teaching (e.g., the number of students actively taking examinations), or third- (i.e., interactions between universities and society) and fourth-mission agendas (i.e., expanding universities’ role including social science and humanities universities in order to contribute to the innovation process in the society; Rinaldi et al., 2018) – universities began to imitate private sector accountability reporting mechanisms and to adapt management control systems (MCSs) (Guenther, 2013; Chenhall, 2007) similar to those of for-profit-companies. Today, universities engage in a multitude of accountability reporting activities, ranging from the compilation of (voluntary and obligatory) reports (e.g., sustainability reports (SRs)) (Alonso-Almeida et al., 2015; Ceulemans et al., 2015b; Lozano et al., 2015), social reports (Del Sordo et al., 2016), and intellectual capital reports (ICRs) (Habersam et al., 2018; Habersam et al., 2013)) to the use of communication channels such as websites or press releases. Moreover, a wide variety of MCSs and performance management systems (PMSs) (Martin-Sardesai and Guthrie, 2018; Edgar and Geare, 2013; Chan and Richardson, 2012; Broadbent and Laughlin, 2009) are applied, e.g., management accounting systems (MASs) (Guenther, 2013; Chenhall, 2007), in order to satisfy internal and external stakeholder demands, but also to monitor universities’ key capabilities.
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Given this development, the aim of this dissertation is to understand universities’ responses to the increased requirements and their concomitant actions by studying universities’ sustainability reporting practices and their applied MCSs. Sustainability reporting allows for the assessment and communication of organisations’ efforts and progress towards the environmental, economic, and social aims of sustainability (Bass and Dalal-Clayton, 2012). According to strategic stakeholder theory, stakeholder expectations are heterogeneous and potentially conflicting, meaning that conflicting claims have to be balanced by the respective organisation (Chen and Roberts, 2010; Freeman, 1984). Furthermore, universities are experiencing increasingly coercive pressure by governmental bodies to be accountable for their performance in research, teaching, and academic self-government, e.g., by preparing SRs (in case of the Spanish province of Andalusia) or ICRs (in case of Austria). By applying strategic stakeholder theory and neo-institutionalism, this dissertation aims to understand universities sustainability reporting practices in compiling SRs in order to meet their stakeholders’ information needs. To achieve this goal, all current Global Reporting Initiative (GRI)-G4-SRs were analysed. The concept of institutional logics is applied to analyse how Austrian public universities cope with conflicting demands, owed to a plethora of different stakeholder expectations, by means of MCSs. The above-mentioned challenges are causing “contradictory practices and beliefs” (Thornton and Ocasio, 2008:101), making “multiple logics available to individuals and organizations” (Friedland and Alford, 1991:232). According to Thornton et al. (2012), institutional logics are linked to and expressed by material practices. Practices in turn are interpreted as activities and beliefs enacted in a specific role. Because roles imply activities and beliefs, different roles can result in conflicts (Jones et al., 2013). Hence, institutional logics directly influence the selection, implementation, and application of MCSs. Furthermore, MCSs are deployed in order to cope with institutional complexity. This dissertation investigates which management control instruments are applied by Austrian public universities in order to fulfil their traditional core mission to facilitate academic research. Inasmuch as universities contribute to the welfare of society and the environment, the advancement of knowledge is at the heart of their being/existence. Austrian public universities are an interesting field to study, because contrary to the Anglo-Saxon tradition of collecting tuition fees, the federal government funds Austrian public universities to a much higher degree. They conclude contracts under public law (i.e., performance agreements) for periods of three years, where each university receives a global budget. Austria was the first country to make ICRs obligatory for universities. Indicators included in the ICR measure the achievement of particular, university-specific strategic objectives of the performance agreement. Amongst others, the ICR has to include universities performance processes, including their outputs and impacts (Universities Act of Austria, 2002), which influences universities’ internally applied MCSs. The investigation of universities’ SRs is positioned in the research field of public sector accountability and analyses, if universities do in fact use this reporting instrument in order to satisfy stakeholder-relevant information needs. Paper Three is positioned in the research field of MCSs and analyses how Austrian public universities cope with different (competing) logics through the application of MCSs to fulfil their core mission of facilitating research. The following figure provides an overview (see Figure 1):
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1.1. Sustainability reporting of universities
Over the past two decades, sustainability reporting has gained relevance mainly in stock exchange-listed for-profit-companies (Cho et al., 2015). In the university sector, too, NPM has been an important driver for increasing accountability pressure (see Paper Two in Appendix 2). In addition, universities are expected to play a key role in creating new cognitive paradigms towards a more sustainable world (Ferrero-Ferrero et al., 2017). Moreover, some universities have signed declarations concerning sustainability in the higher education sector (see Paper One in Appendix 1). Advocates of (voluntary) sustainability reporting stress its contribution to more transparency and accountability (James, 2015; Malik, 2015; Nickell and Roberts, 2014; Baker, 2010). Therefore, sustainability reporting has the potential for contributing to the goal of increasing stakeholders’ trust and helping organisations to demonstrate the link between its strategy and its commitment to sustainable development. Opponents criticize sustainability reporting as a greenwashing attempt, strategic impression management or a management fad (Burritt and Schaltegger, 2010; Gray, 2010; Hopwood, 2009). Due to their voluntary and unregulated nature, sustainability disclosures may be selective and biased, leading stakeholders to false assumptions of specific organisations (Cho et al., 2015). To make SRs more stakeholder relevant, stakeholder inclusiveness (SI) and materiality have emerged as principles for defining report content (including SI, sustainability context, materiality and completeness) in sustainability reporting (Diouf and Boiral, 2017; Eccles et al., 2012). According to the GRI-G4-Guidelines, “[t]he reporting organization shall identify its stakeholders, and explain how it has
responded to their reasonable expectations and interests” (GRI, 2016:8). Concerning materiality, “[t]he
report shall cover topics that: reflect the reporting organization’s significant economic, environmental,
and social impacts; or substantively influence the assessments and decisions of stakeholders. […]
Relevant topics, which potentially merit inclusion in the report, are those that can reasonably be
considered important for reflecting the organization’s economic, environmental, and social impacts, or
influencing the decisions of stakeholders” (GRI, 2016:10). For instance, GRI-G4-Guidelines’ disclosure title “G4-19” (list of material topics) requires that all material aspects that were identified as the outcome of the stakeholder engagement (SE)-process for defining a report’s content and topic boundaries (G4-18) shall be listed and ranked according to their relevance (GRI-G4-Guidelines’ disclosure title G4-19 to G4-22) for internal and external stakeholder groups. By means of establishing a SE-process, organisations should identify their most important stakeholder groups and their information needs. According to Secundo et al. (2016), stakeholder participation and engagement have become elementary to achieving, in particular, third mission aims (i.e., social engagement and regional development). This makes engaging with all university stakeholders a necessity. In order to avoid an overload with a plethora of irrelevant information disclosed, SRs should focus on aspects which stakeholders regard as material (see Paper One in Appendix 1). As a rather new emergent principle in SRs (Diouf and Boiral, 2017; Eccles et al., 2012), materiality has a long tradition in financial reporting. Edgley (2014:255)
Figure 1: Research fields of the dissertation
Public sector accountability
Coverage of
materiality in
universities’ SRs
MCSs of public universities
SI in universities’ SRs
Research
management at
universities
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identified divergent roles of materiality with a broad variety: “a moral responsibility; a solution to the
problem of over-auditing; a solid epistemic foundation for financial reporting; a scientific technique; a
quantitative rule of thumb; a risk management concept; and a mysterious shield”. In sustainability reporting, materiality is either seen as a tool for selecting the most important SR-aspects in general (KPMG, 2017; Jones et al., 2015a; Jones et al., 2015b; Manetti, 2011) or as a concept focused on the information needs of providers of financial capital (IFAC, 2021; IIRC, 2021) as well as stakeholders (AccountAbility, 2019; Calabrese et al., 2016; GRI, 2016; Edgley et al., 2015) (see Paper One in Appendix 1). In order to examine universities’ sustainability reporting practices, Paper One and Paper Two focus on the GRI-G4-Guidelines. A wide range of tools and frameworks were developed for improving and standardising sustainability reporting of universities. According to Larrán Jorge et al. (2016:690), the GRI-Guidelines are one of the most suitable options to “assess and report sustainability”, representing the most widely implemented standard (KPMG, 2017) (see Paper One in Appendix 1). Compared with other frameworks with a regional focus or a narrower definition of sustainability, and as an international framework, the GRI-Guidelines allow comparing between universities, which should consider all three dimensions of sustainability, i.e., the environmental, the economic, and the social dimension (Alonso-Almeida et al., 2015; Lopatta and Jaeschke, 2014; Lozano, 2006). The GRI-Guidelines are not only the most frequently implemented standard but also the one with the longest learning curve. Moreover, as stated above, the GRI-Guidelines focus on stakeholder relevance by defining the principle of SI and the principle of materiality. While Paper One examines the materiality of universities’ G4-SRs (see Paper One in Appendix 1), the second article deals with the content principle of SI (see Paper Two in Appendix 2). According to GRI-G4-Guidelines, “[s]ustainability reporting, […], is an organization’s practice of
reporting publicly on its economic, environmental, and/or social impacts, and hence its contributions –
positive or negative – towards the goal of sustainable development” (GRI, 2016:3). For the non-university sector, findings show that the adoption of materiality in SRs is guided by a strategic management approach (see Paper One in Appendix 1). The investigation of the content principle of materiality in universities’ SRs is still in its infancy. Furthermore, available studies do not allow for comparison between the identified material aspects and their (total) coverage rates ((T)CRs) in the SRs. Addressing the content principles of SI and SE is an even lesser addressed topic (see Paper Two in Appendix 2). Therefore, Paper Two identifies the SRs’ documentation of relevant stakeholder groups, the main communication topics, and the coverage of these categories in the analysed SRs. In analysing universities’ sustainability reporting practices in the context of stakeholder accountability, both papers build on strategic stakeholder theory and neo-institutionalism as a theoretical framework. Under resource- and support-providing aspects, universities try to meet the information needs of their most important stakeholder groups (Calabrese et al., 2016; Puroila et al., 2016). Due to the voluntary nature of sustainability reporting guidelines, a low compliance and diffusion rate has to be expected (Shabana et al., 2017; Higgins and Larrinaga, 2014; Bebbington et al., 2009) (see Paper One in Appendix 1 and Paper Two in Appendix 2).
1.2. Management controls systems of universities
Changing university environments, university corporatisation and commercialisation have “reconfigured
universities’ governance, missions, core values and the roles of their academics” (Parker, 2011:434). As stated above, universities engage in a multitude of voluntary or mandatory accountability reporting activities. In the case of Austrian public universities, the Universities Act of Austria (2002) provided universities with autonomy and concurrently introduced accountability by making ICRs obligatory (see
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Figure 2: Management control systems package (Malmi and Brown, 2008)
Paper Three in Appendix 3). The compulsory preparation of ICRs and the associated obligation to measure the intellectual capital by indicators significantly influences universities’ self-concept and in the following university-internal management control instruments. Public universities were transformed into hybrid organisations that continuously incorporate elements of distinct, competing logics (Vakkuri and Johanson, 2020; Boitier et al., 2018; Upton and Warshaw, 2017; Lepori, 2016; Pache and Santos, 2013; Thornton et al., 2012) (see Paper Three in Appendix 3). While trying to uphold their traditional Humboldtian ideal of freedom and autonomy in research and teaching, public universities simultaneously have to comply with the legal requirements to conclude performance agreements and provide performance indicators as well as to enhance international competitiveness. Embedded in this complex and contradictory environment, Paper Three provides insights into the university-internal selection, implementation and application of MCSs in managing (competing) institutional logics: the academic logic, the government logic, and the business logic (Conrath-Hargreaves and Wüstemann, 2019). “[L]ogics provide the rules of the game” (Thornton et al., 1999:806), and become evident in this particular setting of practices: “practices […] are fundamentally interrelated
with institutional logics” (Thornton et al., 2012:128). Material practices represent one of the core elements of institutional logics (Thornton and Ocasio, 2008; Friedland and Alford, 1991) or “the content
of a role” (Jones et al., 2013). A given organisations’ belief system immediately influences the control mechanism and thus directly influences MCSs (Ahrens and Khalifa, 2015; Lounsbury, 2008). Vice versa, MCSs do not address a specific logic, but may help cope with the copresence of different logics by mediating between them (Busco et al., 2017). Pache and Santos (2013) state that, by combining activities from each logic, organisations gain legitimacy. Moreover, MCSs may “contribute to lock
different parties to their own logic” (Busco et al., 2017:191). Paper Three seeks to investigate the importance of MCSs in managing competing institutional logics at Austrian public universities. It shows how Austrian public universities deal with institutional complexity and how they cope with the coexistence of (competing) institutional logics by applying MCSs in the core mission area of research. In order to fulfil this purpose, the concept of MCSs as a package (Malmi and Brown, 2008) was applied in Paper Three. This concept is designed to guide employees’ behaviour intentionally (see Paper Three in Appendix 3). MCSs are defined as “those systems, rules, practices, values and other activities
management put in place in order to direct employee behaviour […]. If these are complete systems, as
opposed to a simple rule […], then they should be called MCSs” (Malmi and Brown, 2008:290). The package distinguishes cultural controls (CC), planning (P), cybernetic controls (CYC), reward and compensation (RC), and administrative controls (AC) (see Figure 2):
Flamholtz et al. (1985:158) describe organisational culture as “the set of values, beliefs and social norms
which tend to be shared by its [the organisation’s] members and, in turn, influence their thoughts and
Cultural Controls
Clans Values Symbols
Planning Cybernetic Controls
Reward and
Compensation Long range
planning
Action
planning Budgets
Financial
Measurement
Systems
Non-Financial
Measurement
Systems
Hybrid
Measurement
Systems
Administrative Controls
Governance Structure Organisation Structure Policies and Procedures
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actions” (see Paper Three in Appendix 3). Within cultural controls, Malmi and Brown (2008) distinguish value-based (e.g., appointment of professors in accordance with universities’ strategic objectives), symbol-based (e.g., universities’ corporate identity), and clan controls (e.g., peer-reviews). Planning sets out goals and guides efforts and behaviour directly (e.g., target agreements). Beyond, by means of plans, standards to be met are provided and the level of effort is determined (Malmi and Brown, 2008). Furthermore, planning serves as an instrument of coordination. Cybernetic controls provide targets and measures to be achieved (e.g., the total amount and quality of publications measured by the journal impact factors), enable feedback and variance analyses, and initiate the modification of behaviour and activities (e.g., by the provision of resources or infrastructure) (Malmi and Brown, 2008). Budgets (e.g., performance dependent budgets), (non-)financial measures (e.g., dependent on the recruitment of third-party funds), and hybrid measures (e.g., ICRs or academic scorecards) are differentiated (see Figure 2). In order to control effort direction, effort duration and effort intensity (Malmi and Brown, 2008), reward
and compensation, i.e., monetary and non-monetary incentives are applied (e.g., individual performance-dependent monetary and non-monetary incentives or appreciations on the university website). By the means of organisation design and structure (administrative controls), employee behaviour is directed by organising, by monitoring (governance) and by specifying how tasks have to be performed (Malmi and Brown, 2008). In Austria, organisational design and structure are governed by the state, and specific research management systems are applied in order to gather data for the ICRs. Some measures can be categorised as different kinds of control, e.g., training as administrative or cultural control type. Provision of resources is not seen as a control instrument but as a “prerequisite for
proper work” (Malmi and Brown, 2008:295) (see Paper Three in Appendix 3). For the university sector, a comprehensive investigation of the applied management control types in the context of institutional logics is still at its beginning (e.g., Dobija et al., 2019; Gebreiter and Hidayah, 2019; Grossi et al., 2019). Institutional logics become manifest by a specific management control package and furthermore, public universities cope with (competing) institutional logics through the application of a specific management control package guided by different logics (see Paper Three in Appendix 3). By the means of narratives, the application of specific management control types out of different logics is justified. Addressing this research gap in particular, Paper Three investigates in-depth the case of the state-funded public universities in Austria from the perspective of universities’ research management. In this institutional field, a variety of factors has influenced the introduction and application of MCSs over the last 20 years, provoking an imitation of, for instance, private sector accounting and management control practices and instruments, in turn changing their structures, strategies and processes (Parker, 2013; 2011). Paper Three builds on the concept of institutional logics (Thornton et
al., 2012; Thornton and Ocasio, 2008; Friedland and Alford, 1991; Alford and Friedland, 1985; DiMaggio and Powell, 1983; Meyer and Rowan, 1977) and the framework of MCSs (Malmi and Brown, 2008) to gain a detailed understanding of how Austrian public universities cope with institutional complexity.
2. Positioning in the academic field and research questions
This dissertation is designed as a cumulative project comprising three research papers: the first and the second paper focus on the GRI-G4 content principles of materiality and SI, respectively, in order to analyse the quality of SRs’ stakeholder accountability; the third contribution analyses universities’ MCSs and investigates how institutional logics are expressed by university’s internal MCSs and the intertwining of specific control types. Furthermore, it is shown how universities cope with the existence of (competing) institutional logics. In doing so, Paper One investigates worldwide universities’ GRI-G4-SRs and the implementation of the content principle of materiality. Paper Two provides insights into SE-processes and the content principle of SI in universities’ SRs across the world and analyses to what
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extent universities comply with the GRI-G4-Guidelines. Paper Three focuses on MCSs as a package in the field of institutional complexity. The following table provides an overview of the papers of this dissertation, the respective journals, and the publication status as well as conference presentations (see Table 1):
Sustainability reporting of universities MCSs of public universities
Paper One: Assessing the materiality of
university G4-sustainability reports
Paper Two: Assessing Universities’ Global
Reporting Initiative G4 Sustainability
Reports in Concurrence with Stakeholder
Inclusiveness
Paper Three: Management Control
Systems in hybrid universities – The case
of Austrian public universities
Associated journals and publication status
Published: Journal of Public Budgeting,
Accounting and Financial Management
(ISSN: 1096-3367, ABS 2)
Published: Palgrave Macmillan Book
Chapter - Public Sector Financial
Management (double-blind peer reviewed)
Major revision (due at the end of June
2021): Qualitative Research in Accounting
and Management
(ISSN: 1176-6093, VHB B)
Conference presentations
Paper One and Paper Two:
AAAJ Special Workshop (May 2017, Warsaw)
Research Forum at the 41st Annual Congress of the European Accounting Association (June 2018, Milan)
EURAM (June 2019, Lisboa)
Paper Three:
22nd Workshop „Hochschulmanagement“ (February 2020, Vienna)
Accepted: Research Forum at the 43rd Annual Congress of the European Accounting Association (May 2020, Bucharest)
Journal of Management and Governance and SIDREA (Società Italiana dei Docenti di Ragioneria e di Economia Aziendale) Virtual
Workshop (November 2020, Naples)
Accepted: Research Forum at the Virtual Annual Congress of the European Accounting Association (May 2021)
2.1. Systematic literature review
2.1.1. Prior research on materiality and sustainability reporting of universities
In order to investigate the content principle of materiality and its coverage in universities’ GRI-G4-SRs, a structured literature review was conducted using two online databases (EBSCOhost and Web of Science). The search period extended from 2000 to 2019 and was limited to peer-reviewed English-language journal articles. The literature review yielded 44 papers (see Paper One in Appendix 1).
Outside the university sector, 18 studies were identified: four studies focus specifically on user information demands, finding that stakeholder information needs are only insufficiently met. 14 articles analyse the process of identifying stakeholder material aspects. In these studies, results show that the listed material aspects are selective and not driven by strategically relevant stakeholders. Within these 14 studies, two studies were identified focusing on the content principle of materiality: Font et al. (2016) compares reported indicators of the cruise industry with the corporate social responsibility index developed by Bonilla-Priego et al. (2014). The disclosure practices based on the AccountAbility’s AA1000 Standard (AccountAbility, 2019) of the largest hotel groups worldwide are analysed in Guix et
al. (2017).
Table 1: Overview of the papers, associated journals, and publication status as well as conference presentations
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Generally, research efforts concerning the preparation of universities’ SRs are increasing (Ferrero-Ferrero et al., 2017; Ceulemans et al., 2015a; Lozano et al., 2015). Inside the university sector, 26 articles could be identified: four articles are worldwide surveys, three articles represent special reports in the field of Higher Education Institutions (HEIs), three deal with the integration/implementation process of sustainability reporting HEIs, four focus on stakeholder expectations, one is a conceptual paper, and eleven papers are about (T)CRs of specific performance dimensions (see Table 2 below).
In order to analyse universities’ SRs, a variety of normative frameworks exists (Larrán Jorge et al., 2016; Ceulemans et al., 2015b), e.g., frameworks extending the GRI-framework with additional, sector-specific indicators (Lopatta and Jaeschke, 2014; Sassen et al., 2014) (see Paper One in Appendix 1). As stated above, the GRI-G4-Guidelines are international, in contrast to those developed exclusive for North America or the European context (Larrán Jorge et al., 2016). With a specific focus on materiality, research taking a holistic approach is missing (Ceulemans et al., 2015b; Lozano et al., 2015). In a single-case study, Yáñez et al. (2019) highlights the role of the SR to a holistic stakeholder accountability and therefore the materiality process. Four studies analyse internal and external stakeholder expectations (Ferrero-Ferrero et al., 2017; Larrán Jorge et al., 2016; Larrán Jorge et al., 2012; Mainardes et al., 2012). While all four studies stress the heterogeneity of stakeholder concerns, only Ferrero-Ferrero et al. (2017) includes a quantitative content analysis of ten universities’ SRs worldwide and examines whether internal stakeholder material aspects are documented in universities’ SRs. Eleven studies examine universities’ SRs CRs with an average below 50 per cent (see Paper One in Appendix 1). The systematic literature review revealed a research gap concerning the question whether identified and documented material aspects do, in fact, guide the reported content.
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Table
2: Litera
ture
revie
w o
n m
ate
rialit
y a
nd s
usta
inabili
ty r
eport
ing o
f univ
ers
itie
s
To
pic
P
ub
licati
on
R
esearc
h d
esig
n r
esp
on
den
ts/s
ecto
r
Outs
ide t
he u
niv
ers
ity s
ecto
r
Use
r in
form
atio
n de
man
ds (
four
art
icle
s)
Dee
gan
and
Ran
kin
(199
7)
Qua
ntita
tive:
123
ann
ual r
epor
t us
ers
in A
ustr
alia
O’D
wye
r et
al. (
2005
) Q
uant
itativ
e: 1
5 so
cial
and
13
envi
ronm
enta
l Non
-Gov
ernm
enta
l Org
anis
atio
ns (
NG
Os)
in I
rela
nd
De
Vill
iers
and
Van
Sta
den
(201
0)
Qua
ntita
tive:
474
sha
reho
lder
s in
Aus
tral
ia, t
he U
K a
nd th
e U
S
Dio
uf a
nd B
oira
l (20
17)
Qua
litat
ive:
33
stak
ehol
ders
and
exp
ert
s in
Can
ada
For
-pro
fit s
ecto
r st
udie
s (1
4 ar
ticle
s)
Ecc
les
et
al. (
2012
) Q
ualit
ativ
e: s
ix in
dust
ries
(48
com
pani
es)
Hsu
et al. (
2013
) C
once
ptua
l: te
chni
cal c
ompa
ny in
Tai
wan
Une
rman
and
Zap
petin
i (20
14)
Qua
litat
ive:
23
com
pani
es S
Rs
in th
e en
ergy
and
min
ing
sect
or
Cal
abre
se e
t al. (
2015
) C
once
ptua
l: re
tail
com
pany
in It
aly
Jone
s et
al. (
2015
a)
Qua
litat
ive:
20
UK
hou
sebu
ildin
g co
mpa
nies
Jone
s et
al. (
2015
b)
Qua
litat
ive:
nin
e U
K c
omm
erci
al p
rope
rty
com
pani
es
Cal
abre
se e
t al. (
2016
) C
once
ptua
l: w
ater
tec
hnol
ogy
com
pany
in I
taly
Fon
t et al. (
2016
) Q
ualit
ativ
e/qu
antit
ativ
e: 2
9 cr
uise
com
pani
es, 5
9 in
tern
al a
nd e
xter
nal s
take
hold
ers
Jone
s et
al. (
2016
a)
Qua
litat
ive:
ten
UK
ret
ailin
g co
mpa
nies
Jone
s et
al. (
2016
b)
Qua
litat
ive:
firs
t ten
for
-pro
fit c
ompa
nies
wor
ldw
ide
liste
d in
Goo
gle
havi
ng p
ublis
hed
a G
4-S
R
Jone
s et
al. (
2016
c)
Qua
litat
ive:
hos
pita
lity
sect
or
Pur
oila
et al. (
2016
) Q
ualit
ativ
e: 2
9 pu
blic
ly tr
aded
com
pani
es in
the
Glo
bal1
00 in
dex
appl
ying
GR
I-G
4-G
uide
lines
La
i et
al. (
2017
) Q
ualit
ativ
e: 1
4 G
ener
ali e
mpl
oyee
s
Gui
x et
al. (
2017
) Q
ualit
ativ
e/qu
antit
ativ
e: 5
0 ho
spita
lity
grou
ps w
orld
wid
e
Univ
ers
ity s
ecto
r
Wor
ldw
ide
surv
eys
(fou
r ar
ticle
s)
Alo
nso-
Alm
eida
et
al. (
2015
) Q
uant
itativ
e/qu
alita
tive:
GR
I da
ta b
ase
and
GR
I-S
Rs
Ceu
lem
ans
et
al. (
2015
b)
Lite
ratu
re r
evie
w:
178
artic
les
Loza
no e
t al. (
2015
) Li
tera
ture
rev
iew
: 60
art
icle
s su
rvey
84
resp
onde
nts
from
70
HE
Is
Bla
nco-
Por
tela
et
al. (
2017
) Li
tera
ture
rev
iew
: 35
art
icle
s
Spe
cial
rep
orts
in th
e fie
ld o
f un
iver
sitie
s
(thr
ee a
rtic
les)
Hab
ersa
m e
t al. (
2013
) Q
ualit
ativ
e: c
ase
stud
y at
Aus
tria
n un
iver
sitie
s
Del
Sor
do e
t al. (
2016
) Q
ualit
ativ
e: c
onte
nt a
naly
sis
of tw
elve
soc
ial r
epor
ts in
Ital
y an
d in
terv
iew
s w
ith t
heir
prep
arer
s
Hab
ersa
m e
t al. (
2018
) Q
ualit
ativ
e: lo
ngitu
dina
l cas
e st
udy
at A
ustr
ian
univ
ersi
ties
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Table
2: Litera
ture
revie
w o
n m
ate
rialit
y a
nd s
usta
inabili
ty r
eport
ing o
f univ
ers
itie
s
To
pic
P
ub
licati
on
R
esearc
h d
esig
n r
esp
on
den
ts/s
ecto
r
Univ
ers
ity s
ecto
r
Inte
grat
ion/
impl
emen
tatio
n pr
oces
s of
sust
aina
bilit
y re
port
ing
in H
EIs
(th
ree
artic
les)
Bru
sca
et al. (
2018
) Q
ualit
ativ
e: U
nive
rsity
of C
adiz
Zor
io-G
rima
et al. (
2018
) Q
ualit
ativ
e: 4
9 pu
blic
uni
vers
ities
in S
pain
Yáñ
ez e
t al. (
2019
) Q
ualit
ativ
e: E
scue
la T
ecni
ca S
uper
ior
de I
ngen
iero
s In
dust
riale
s
Inte
rnal
and
ext
erna
l sta
keho
lder
exp
ecta
tions
(fo
ur a
rtic
les)
Larr
án J
orge
et
al. (
2012
) Q
ualit
ativ
e: s
take
hold
er g
roup
s of
ten
publ
ic u
nive
rsiti
es in
And
alus
ia
Mai
nard
es e
t al. (
2012
) Q
ualit
ativ
e/qu
antit
ativ
e: 1
669
stud
ents
’ exp
ecta
tions
at e
leve
n pu
blic
uni
vers
ities
in P
ortu
gal
Larr
án J
orge
et
al. (
2016
) Q
ualit
ativ
e: s
enio
r m
anag
emen
t mem
bers
of
eigh
t pub
lic u
nive
rsiti
es in
And
alus
ia
Fer
rero
-Fer
rero
et
al. (
2017
) Q
ualit
ativ
e/qu
antit
ativ
e: te
n un
iver
sitie
s’ S
Rs
(201
4) a
nd a
cas
e st
udy
in a
Spa
nish
pub
lic u
nive
rsity
Fra
mew
ork
Loza
no (
2006
) C
once
ptua
l
TC
Rs
or C
Rs
of p
erfo
rman
ce d
imen
sion
s
(ele
ven
artic
les)
Fon
seca
et al. (
2011
) C
once
ptua
l/qua
litat
ive:
sev
en C
anad
ian
univ
ersi
ties
(200
6-20
08)
Loza
no (
2011
) Q
ualit
ativ
e: t
wel
ve u
nive
rsiti
es w
orld
wid
e (2
002-
200
9) b
y th
e G
AS
U-F
ram
ewor
k (L
ozan
o, 2
006)
Lopa
tta
and
Jaes
chke
(20
14)
Con
cept
ual/q
ualit
ativ
e: s
ix G
erm
an a
nd A
ustr
ian
univ
ersi
ties
(unt
il 20
11)
Sas
sen
et al. (
2014
) C
once
ptua
l/qua
litat
ive:
14
Ger
man
uni
vers
ities
(24
rep
orts
) re
gard
less
the
ir ap
plie
d st
anda
rds
(200
4-20
14)
Hin
son
et al. (
2015
) Q
ualit
ativ
e: s
ix G
hana
ian
univ
ersi
ties
(201
2) b
ased
on
GR
I-G
3-G
uide
lines
and
Fon
seca
’s fr
amew
ork
(Fon
seca
et
al., 2
011)
Rom
olin
i et
al. (
2015
) Q
ualit
ativ
e: 2
0 un
iver
sitie
s w
orld
wid
e (2
012)
by
anal
ysin
g G
RI-
G3.
1-G
uide
lines
Bic
e an
d C
oate
s (2
016)
Q
ualit
ativ
e: t
en E
nglis
h la
ngua
ge r
epor
ts w
orld
wid
e (2
007
-201
4) b
ased
on
GR
I-G
3-G
uide
lines
(th
ree
univ
ersi
ties)
or
GR
I-G
3.1-
Gui
delin
es (
seve
n un
iver
sitie
s)
Dag
ilien
ė an
d M
ykol
aitie
nė (
2016
) Q
ualit
ativ
e: 4
0 Li
thua
nian
tert
iary
sec
tor
inst
itutio
ns (
2013
-201
4),
amon
g th
em e
leve
n un
iver
sitie
s
Larr
án J
orge
et
al. (
2018
) Q
ualit
ativ
e: 5
8 un
iver
sitie
s w
orld
wid
e (1
38 S
Rs)
fol
low
ing
GR
I-G
3-, G
RI-
G3.
1- o
r G
RI-
G4-
Gui
delin
es
Sas
sen
and
Azi
zi (
2018
a)
Qua
litat
ive:
20
Can
adia
n pu
blic
and
priv
ate
univ
ersi
ties
rega
rdle
ss t
heir
appl
ied
stan
dard
s (2
011-
2015
)
Sas
sen
and
Azi
zi (
2018
b)
Qua
litat
ive:
23
US
uni
vers
ities
par
ticip
atin
g in
the
Sus
tain
abili
ty T
rack
ing,
Ass
essm
ent
and
Rat
ing
Sys
tem
(S
TA
RS
) (2
014)
June, 2021 Judith Frei 11/45
2.1.2. Prior research on stakeholder inclusiveness and sustainability reporting of universities
In order to investigate the content principle of SI in universities’ GRI-G4-SRs, a structured literature review was conducted using three online databases (EBSCOhost, Science Direct and Web of Science). The search period extended from 2000 to 2019 and was limited to peer-reviewed English-language journal articles. The literature review yielded 22 papers (see Paper Two in Appendix 2). Three studies concerning SI in selected SRs or integrated reports (IRs), five studies addressing internal and external stakeholder expectations, and 14 studies analysing guideline compliance of SRs were identified (see Table 3 below). Concerning the first cluster, Brusca et al. (2018) identified universities’ supervisory boards (in Spain called “Social Council”) as representative of other stakeholders and auditors as supporters of the implementation process of integrated reporting. In a case study of a South African university, Veltri and Silvestri (2015) found that stakeholder interests were not considered when drawing up the SR and defining report content; these results correspond to those of Lozano et al. (2013), who analysed the SR’s preparation process at the University of Leeds. All three studies have in common that stakeholder interests were not considered systematically when preparing SRs. With reference to internal and external stakeholder expectations, five studies show that stakeholder groups have comprehensive and diverse information needs. Regarding the research field of SI, and therefore the identification of stakeholders and organisations’ explanations of taking into account their expectations and information needs, existing literature is limited. However, the scant studies show the variety of stakeholder information needs. Comprehensive research concerning SE activities, i.e., the process of actually considering stakeholder views, the priority of stakeholder groups and topics is missing. Out of the 14 studies analysing the guideline compliance of SRs, four studies examine selected aspects of SRs/IRs (Zorio-Grima et al., 2018; Bice and Coates, 2016; Dagilienė and Mykolaitienė, 2016; Siboni et al., 2013), e.g., selected triple bottom line (TBL) indicators (Bice and Coates, 2016) or the general consistence with the GRI-Guidelines (Siboni et al., 2013). Ten studies examined universities’ TCRs and specific CRs (see Paper Two in Appendix 2). Out of these ten studies, two articles focus on the coverage of SE (Hinson et al. 2015; Fonseca et al., 2011). Hinson et al. (2015) ascertained four out of six universities reporting on this indicator. Fonseca et al. (2011) state that four out of the seven universities reported on SE. In both studies, coercive pressure from resource providing societal key stakeholders was the reason for including information about sustainability in their annual reports (Hinson et al., 2015; Fonseca et al., 2011). Across all identified 22 studies on the sustainability reporting practices of universities, with the exception of Ferrero-Ferrero et al. (2017), the SE-process and SI are scarcely addressed. No study focuses on the fit between the documented topics and the CRs of universities’ SRs in the SE-process analysed or addresses whether the relevant topics are in fact reported in the GRI-G4-SRs.
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To
pic
P
ub
licati
on
R
esearc
h d
esig
n r
esp
on
den
ts/s
ecto
r
SI i
n se
lect
ed S
Rs/
IRs
(thr
ee a
rtic
les)
Bru
sca
et al. (
2018
) S
ingl
e ca
se s
tudy
: im
plem
enta
tion
of s
usta
inab
ility
rep
ortin
g an
d in
tegr
ated
rep
ortin
g at
the
Uni
vers
ity o
f C
adiz
Vel
tri a
nd S
ilves
tri (
2015
) S
ingl
e ca
se s
tudy
: inv
estig
atio
n of
the
IR o
f the
Fre
e S
tate
Uni
vers
ity in
Sou
th A
fric
a
Loza
no e
t al. (
2013
) S
ingl
e ca
se s
tudy
: SR
pre
para
tion
proc
ess
of th
e U
nive
rsity
of L
eeds
Inte
rnal
and
Ext
erna
l Sta
keho
lder
Exp
ecta
tions
(fiv
e ar
ticle
s)
Fer
rero
-Fer
rero
et
al. (
2017
) Q
ualit
ativ
e/qu
antit
ativ
e: S
E-t
echn
ique
s in
SR
s, c
ompl
ianc
e ra
tes
betw
een
stak
ehol
der
expe
ctat
ions
and
doc
umen
ted
aspe
cts
in a
Spa
nish
pub
lic u
nive
rsity
Larr
án J
orge
et
al. (
2016
) Q
ualit
ativ
e: id
entif
icat
ion
of s
take
hold
er m
ater
ial a
spec
ts fo
r a
sust
aina
bilit
y as
sess
men
t and
rep
ortin
g to
ol in
eig
ht p
ublic
univ
ersi
ties
in A
ndal
usia
Larr
án J
orge
et
al. (
2012
) Q
ualit
ativ
e: a
naly
sis
of s
take
hold
er e
xpec
tatio
ns o
f ten
pub
lic u
nive
rsiti
es in
And
alus
ia
Ral
ph a
nd S
tubb
s (2
014)
Q
ualit
ativ
e: in
vest
igat
ion
of f
acto
rs in
fluen
cing
the
inte
grat
ion
of e
nviro
nmen
tal s
usta
inab
ility
at f
our
Eng
lish
and
four
Aus
tral
ian
univ
ersi
ties
Mai
nard
es e
t al. (
2012
) Q
ualit
ativ
e/qu
antit
ativ
e: a
naly
sis
of s
tude
nts’
exp
ecta
tions
at e
leve
n pu
blic
uni
vers
ities
in P
ortu
gal
Ana
lysi
s of
SR
s/IR
s: s
elec
ted
aspe
cts
(fou
r
artic
les)
Bic
e an
d C
oate
s (2
016)
Q
ualit
ativ
e: s
elec
tive
TB
L in
dica
tors
bas
ed o
n G
RI-
G3-
Gui
delin
es (
thre
e un
iver
sitie
s) o
r G
RI-
G3.
1-G
uide
lines
(se
ven
univ
ersi
ties)
Dag
ilien
ė an
d M
ykol
aitie
nė (
2016
) Q
ualit
ativ
e: s
elec
ted
TB
L in
dica
tors
of
the
GR
I G3
in L
ithua
nia’
s te
rtia
ry s
ecto
r in
stitu
tions
Sib
oni e
t al
. (2
013)
Q
ualit
ativ
e: a
pplic
atio
n of
inte
rnat
iona
l gui
delin
es a
t nin
e Ita
lian
univ
ersi
ties
Zor
io-G
rima
et al. (
2018
) Q
ualit
ativ
e: r
epor
ting
on t
he G
RI i
ndic
ator
s by
49
publ
ic u
nive
rsiti
es in
Spa
in
Rep
ortin
g on
TC
Rs
or s
peci
fic C
Rs
(ten
artic
les)
Fon
seca
et al. (
2011
) C
once
ptua
l/qua
litat
ive:
rep
ortin
g on
TC
R, s
peci
fic C
Rs
and
SE
at s
even
Can
adia
n un
iver
sitie
s
Loza
no (
2011
) Q
ualit
ativ
e: r
epor
ting
on s
peci
fic C
Rs
at t
wel
ve u
nive
rsiti
es w
orld
wid
e by
the
GA
SU
-Fra
mew
ork
(Loz
ano,
200
6)
Lopa
tta
and
Jaes
chke
(20
14)
Con
cept
ual/q
ualit
ativ
e: r
epor
ting
on T
CR
and
spe
cific
CR
s at
six
Ger
man
and
Aus
tria
n un
iver
sitie
s
Sas
sen
et al. (
2014
) C
once
ptua
l/qua
litat
ive:
rep
ortin
g on
spe
cific
CR
s at
14
Ger
man
uni
vers
ities
reg
ardl
ess
thei
r ap
plie
d st
anda
rds
Hin
son
et al. (
2015
) Q
ualit
ativ
e: r
epor
ting
on T
CR
and
SE
at s
ix G
hana
ian
univ
ersi
ties
base
d on
GR
I-G
3-G
uide
lines
and
Fon
seca
’s fr
amew
ork
(Fon
seca
et
al., 2
011)
Rom
olin
i et
al. (
2015
) Q
ualit
ativ
e: r
epor
ting
on s
peci
fic C
Rs
at 2
0 un
iver
sitie
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June, 2021 Judith Frei 13/45
2.1.3. Prior research on universities’ management control systems and institutional logics
In order to investigate MCSs in the field of academic research at universities, a structured literature review was conducted using three online databases (EBSCOhost, Scopus and Web of Science). The search period extended from 2002 to 2019 and was limited to peer-reviewed English-language journal articles. The literature review yielded 60 relevant papers (43 papers concerning MCSs and 17 papers concerning institutional logics in the context of MCSs) (see Paper Three in Appendix 3). Regarding research on MCSs, most of the articles investigate several management control types (see Figure 3). Figure 4 below allows for multiple mentions (see Figure 4). Generally speaking, cultural controls, cybernetic controls as well as reward and compensation are of central importance in the literature. The management control type least investigated is planning. Figure 5 provides an overview of the examined management control types (see Figure 5):
AC
22%
CC
24%
CYC
23%
P
8%
RC
23%
AC
9%
CC
7%
CYC
21%
P
5%RC
16%
several
42%
Figure 4: Content-related foci (overlapped) of management control types Figure 3: Content-related foci of management control types
Administrative Controls
central administration vs. research offices
vice rectorate
clear division of responsibilities
communication
balance between teaching and research
"pre-/post-award"assumption of administrative and bureaucratic tasksinfrastructure
trainings
mentoring program
international assignment
Cultural Controls
research management = supporterresearch = independent, autonomous actingfreedom of organisation and content
research culture
exchange between researchers
"group understanding"
motivation
Cybernetic Controls
financial resources
system of indicators
balanced scorecard
human capital management systems
scoring system
quality systems
evaluations
Planning
long-term planningcorrespondence between plans and incentivesperformance reviews
evaluation and assessment of targets
Reward and Compensation
personal support
infrastructure support
financial incentives
subsidies
promotion
partial exemption from teaching
awards
appreciation (commendation)
Figure 5: Types of management control
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In general, university culture plays an important role in supporting research efforts with a focus on maintenance of freedom and autonomy in research and teaching (Agyemang and Broadbent, 2015). Intrinsic motivation should be preserved (Sutton and Brown, 2016; Hendriks and Sousa, 2013; Adler et
al., 2009). Marketization of universities is increasing (Kallio et al., 2016). As the provision of financial resources is a prerequisite for research (Sousa and Hendriks, 2008; Kirkland, 2005; Stackhouse and Day, 2005), performance indicators are gaining increasing importance (Silander and Haake, 2017). PMSs should be employed carefully, because they may inhibit creativity (Ter Bogt and Scapens, 2012) and cause competition (Mingers and Willmott, 2013). Increasingly, they are used as a monitoring instrument (Hemlin and Rasmussen, 2006). In the literature, a wide variety of monetary (e.g., research budgets, bonuses or salary increases) and non-monetary incentives (e.g., tenure-track positions, time for research or release of teaching) were found. As stated in Paper Three, the awareness of research management has increased (Kirkland, 2005; Stackhouse and Day, 2005) (see Paper Three in Appendix 3). A key finding of the analysed studies is the instrumental character of administrative controls used to enhance motivation and to support research environment. Although the application of MCSs or specific control types in the HEI-sector plays a vital role in enhancing research efforts, and although and the influence of MCSs and PMSs on organisational culture is discussed, the literature reviewed indicates a lack of consequences if specific requirements are not fulfilled. Regarding research on institutional logics, two clusters were identified: the impact of regulations and reactions to internal and external demands (ten studies) and responses to co-existing logics in HEIs (seven studies). The first cluster focuses on effects of individual measures (e.g., university rankings, audit culture, reorganisation, accreditation, impact of qualification frameworks, the introduction of budgeting practices or an Enterprise Resource Planning (ERP) system). The second cluster deals with responses to the co-existence of different logics: For instance, Gebreiter and Hidayah (2019) analysed how individual lecturers at an English business school respond to competing accountability pressures exerted by professional and commercial logic and found a wide range of reactions including compliance, defiance, combination or compartmentalisation. Dobija et al. (2019) found that four Polish universities often use performance measurement in a ceremonial and symbolic manner and that the use of performance measurement is loosely coupled with the reporting performance for accountability purposes. In addition, a co-existence of logics was found entering into robust combinations (Grossi et
al., 2019). Boitier et al. (2018) assessed organisational changes induced by managerial logic in a French and two German universities, revealing different hybrid responses in the form of segmentation and blending. Therefore, a variety of reactions was found depending on the specific situation. Only seven studies were identified as dealing with the higher education sector, six of which focus on a regional case and one conducted a Europe-wide survey. No study relates to Austrian public universities (see Paper Three in Appendix 3).
2.2. Theoretical and conceptual approaches
The following table provides an overview of the theoretical and conceptual approaches of the core publications (see Table 4):
Sustainability reporting of universities MCSs of public universities
Paper One: Assessing the materiality of
university G4-sustainability reports
Paper Two: Assessing Universities’ Global
Reporting Initiative G4 Sustainability
Reports in Concurrence with Stakeholder
Inclusiveness
Paper Three: Management Control
Systems in hybrid universities – The case
of Austrian public universities
Table 4: Theoretical and conceptual approaches of the core publications
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Sustainability reporting of universities MCSs of public universities
Theoretical and conceptual approach
Strategic stakeholder theory Strategic stakeholder theory Institutional logics
Sociological institutionalism Sociological institutionalism MCSs as a package
2.2.1. Strategic stakeholder theory
As stated above, stakeholder theory considers the relationship between organisations and interrelated groups (Parmar et al., 2010; Freeman, 1984) (see Paper One in Appendix 1). According to Freeman et
al. (2010), it is essential to identify stakeholders and their perceived stakes clearly (rational level). Additionally, it is relevant to manage an organisation’s relationship with its stakeholders (process level) and to understand the set of transactions or bargains among an organisation and its stakeholders (transactional level). The identification of relevant stakeholder groups is not an easy task. A quite broad notion of stakeholders, originally advocated by Freeman (1984) and still prevalent in normative stakeholder theory today, sees stakeholders as groups or individuals who ‘‘can affect or is affected by the achievement of
an organization’s purpose’’ (Freeman, 1984:53). More narrow concepts of stakeholder identification limit stakeholders to those who are strategically relevant for achieving an organisation’s primary objectives or to those who supply critical resources or are most closely related with an organisation’s operations (Harrison et al., 2010; Mitchell et al., 1997; Hill and Jones, 1992). Strategic stakeholder theory claims that understanding the needs and concerns of an organisation’s strategic stakeholders as part of a strategic stakeholder management will lead to receiving the necessary support for survival and will create a competitive advantage (Harrison, 2013; Freeman, 1984). One of the central assumptions of strategic stakeholder theory is that a cooperative and trustful relationship with important key-stakeholder groups is a corporation’s critical success factor and a precondition for continuous resource provision (Freeman et al., 2004). Satisfying the needs and demands of strategically relevant stakeholders is seen as a win-win situation, which unlocks an additional potential for value creation (Harrison et al., 2010; Freeman et al., 2004; Donaldson and Preston, 1995). For the university sector, SRs constitute a managerial instrument to achieve and maintain legitimacy and therefore to attain resource provision of strategically relevant stakeholders (e.g., basic funding provided by the state and tuition fees or third-party funding) (Ntim et al., 2017). An essential claim within strategic stakeholder theory is that stakeholder expectations are multi-fold, heterogeneous, and conflicting. Therefore, trade-offs have to be made to balance these conflicting stakeholder demands (Chen and Roberts, 2010; Freeman, 1984) (see Paper One in Appendix 1). Providing strategically relevant stakeholders, identified in a SE-process, with relevant, complete, and coherent information for assessing an organisation’s sustainability behaviour, is the main objective of the GRI-G4 content principle of materiality (Calabrese et al., 2016). Under resource-providing aspects, the pressures on universities to serve the information needs of strategically relevant stakeholders have increased considerably. To know what strategically relevant stakeholders regard as material is in the core interest of the universities. To serve these interests with SRs focused on stakeholder material aspects is a logic consequence. Based on the reasoning of strategic stakeholder theory, it can be argued that SRs of universities should show a high compliance between the documented material aspects and the reported content.
Table 4: Theoretical and conceptual approaches of the core publications
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As stated in the motivation, the first and the second paper of this dissertation focus on the content principles of materiality and SI. These principles require that universities, striving for acceptance and legitimacy (Larrán Jorge et al., 2012), identify medium or highly salient stakeholders and concentrate report content on aspects which they consider relevant. In addition, the report content should match the information needs of the identified stakeholder groups. In order to meet these requirements, the SE-process serves to identify the main stakeholder groups and consequently to identify their information needs, more specifically to classify their information needs as low, medium or highly relevant. According to Burritt and Schaltegger (2010), this approach is referred to as ‘outside-in’ approach. By means of SE, “trust between the organization and its stakeholders” is strengthened and “[T]rust, in turn, strengthens
the credibility of the report” (GRI, 2016:8).
2.2.2. Sociological institutionalism
Through the lens of sociological institutionalism, compliance with the materiality principle is seen more critically. Sociological institutionalism analyses patterns of organisational behaviour on the field and organisational level and studies the resulting impacts of conformity to those patterns (Chen and Roberts, 2010). Sociological institutionalism focuses on the effects of social pressure in terms of stability, legitimacy, and survival (Higgins and Larrinaga, 2014; Chen and Roberts, 2010) (see Paper One in Appendix 1). For universities, it is important to demonstrate that they adhere to prescribed myths of the institutional environment (Meyer and Rowan, 1991). This approach aims at explaining sustainability reporting in terms of institutional expectations. Organisational behaviour is triggered by coercive, normative, and mimetic isomorphism (Higgins and Larrinaga, 2014; DiMaggio and Powell, 1991). Coercive isomorphism results “from both formal and informal pressures exerted on organizations by
other organizations upon which they are dependent and by cultural expectations” (DiMaggio and Powell, 1991:67). Coercive isomorphism is based on power relationships and politics and therefore results from regulations by the state and other powerful actors with sanctioning powers, for instance, in the context of sustainability reporting, rating agencies, institutional investors or critical shareholders (Chen and Roberts, 2010; Heugens and Lander, 2009). In the case of the Spanish province of Andalusia, universities are legally obliged to prepare SRs. For universities, trying to avoid sanctions and to maintain legitimacy would mean to bow to this pressure and conform to these expectations and regulations. According to DiMaggio and Powell (1991), normative isomorphism stems from professionalization and demands conformity to professional standards. Sources for normative isomorphism are professional networks as well as credential and educational institutions, because similar education and training instil values considered as proper organisational behaviour (Heugens and Lander, 2009). Conformity develops through knowledge and professional networks, e.g., the GRI-Guidelines, which suggest reporting practices and recommendations concerning report content and report quality. Mimetic isomorphism develops primarily from uncertainty. As a low-cost coping strategy, organisations imitate popular peer organisations they perceive as successful (Heugens and Lander, 2009; Boxenbaum and Jonsson, 2008; DiMaggio and Powell, 1991). Accordingly, universities would adopt reporting practices of other universities to maintain legitimacy and to meet stakeholder expectations. Due to its leading role within sustainability reporting guidelines, some authors subsume the GRI-Guidelines under coercive isomorphism (Shabana et al., 2017; Chatelain-Ponroy and Morin-Delerm,
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2016; Higgins and Larrinaga, 2014). Others classify the GRI-Guidelines as normative isomorphism (De Villiers and Alexander, 2014; Etzion and Ferraro, 2010; Bebbington et al., 2009) due to their voluntary nature. Sanctioning powers based on the GRI-Guidelines are de facto non-existent. However, the diversity and heterogeneity of stakeholders (e.g., ministries, private foundations, students, academic staff, and future employers) as well as stakeholder demands and information needs have increased considerably over the last decades. As stated above, universities have to compete for students and research grants, but also for governmental funding. Prioritising stakeholders and stakeholder demands is a difficult task, allowing a variety of interpretations (Unerman and Zappettini, 2014).
2.2.3. Institutional logics
As stated in Paper Three, the notion of institutional logics (Alford and Friedland, 1985) relates to contradictory practices and beliefs inherent in institutions of societies (Thornton and Ocasio, 2008) (see Paper Three in Appendix 3). According to DiMaggio and Powell (1983) as well as Meyer and Rowan (1977), institutional logics describe the influence of cultural regulations and cognitions on organisational structure. Institutions “shape individual preferences and organizational interests as well as the repertoire
of behaviors by which they may attain them. These institutions are potentially contradictory and hence
make multiple logics available to individuals and organizations. Individuals and organizations transform
the institutional relations of society by exploiting these contradictions” (Friedland and Alford, 1991:232). The institutional logics perspective posits that each of the most important institutional orders has a central logic (e.g., the institutional logics of the societal sectors profession, state or market (Thornton et
al., 2005)). Friedland and Alford (1991) identified the market, the bureaucratic state, democracy, the nuclear family, and Christian religions as characteristics of societal-level orders, each possessing a distinct institutional logic (see Paper Three in Appendix 3). Institutional logics are expressed by a set of material practices and symbolic constructions and become evident in particular settings of practices (Thornton and Ocasio, 2008; 1999; Haveman and Rao, 1997; Friedland and Alford, 1991) (see Paper Three in Appendix 3). In other words, “practices […] are fundamentally interrelated with institutional
logics” (Thornton et al., 2012:128) and represent one of the core elements of institutional logics (Thornton and Ocasio, 2008; Friedland and Alford, 1991) (e.g., management control practices). “Theories, frames, and narratives” are forms of symbolic representations (Thornton et al., 2012:149). Narratives, in turn, “reflect specific organizing practices, their development, and their outcomes”, and “help to make sense” (Thornton et al., 2012:155). By means of narratives, retro- and prospective sensemaking “materializes the identities and categories through which organizations and institutions
come into existence” (Thornton et al., 2012:96) (e.g., by justifying the application of selected management control practices). For the higher education sector, Boitier and Rivière (2016) identify the academic, political, bureaucratic, and managerial logic. Conrath-Hargreaves and Wüstemann (2019) found the academic, government, and business logic at a German foundation university. Academic logic is guided by the aim to produce knowledge and contribute to the researchers’ own and their university’s reputation. A high degree of autonomy and reputation based on the opinion of peers are its central guiding principles. Government logic is characterised by a tight corset of regulations determined by the government, leading to homogeneity and standardisation. According to business logic, universities’ identity is linked to their perception as a business-like entity. Generating financial income is a central strategic aim.
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Paper Three of this dissertation adopts the classification proposed by Conrath-Hargreaves and Wüstemann (2019), Boitier and Rivière (2016), and Thornton et al. (2005) in order to analyse how public universities cope with the co-presence of different (competing) logics. Due to the emergence of contradictions, universities have to respond to and manage potentially arising conflicts. Greenwood et
al. (2011:349) emphasise that “[t]he response of an organization to competing logics, in other words, is
partly a function of how logics are given voice within the organization; but the ability of a voice to be
heard is linked to the influence of that logic’s field-level proponents over resources – including legitimacy
– that they control” (see Paper Three in Appendix 3). Universities’ changing environment, i.e., regulation by the state with simultaneously increasing liberalisation, corporatisation and commercialisation (Parker, 2011) as well as the increase and variety of stakeholder groups have led to an evolution in institutional logics (Thornton et al., 2012). Theories and frames are adapted by organisations, and changes in material practices and symbolic representations follow, provoking shifts (Thornton et al., 2012). Oliver (1991) provides an overview on how to cope with competing logics. Coping strategies range from ‘tight coupling’ in the case of financial dependency (Rautiainen and Järvenpää, 2012) to different approaches of ‘decoupling’ (i.e., superficial conformity) by symbolically adopting rituals defined by the environment to minimise legitimacy threats (Boxenbaum and Jonsson, 2008; Meyer and Rowan, 1977). Thornton et al. (2012) focus on the direction and the extent of change in institutional logics, finding forms of transformational change processes (replacement, blending and segregation) as well as developmental change processes (assimilation, elaboration, expansion and contradiction). However, as scholars indicate, major transformations (i.e., the replacement of one logic by another) may not be the rule. For the purposes of Paper Three of this dissertation (see Paper Three in Appendix 3), two processes in particular are examined more closely: blending and assimilation. Through the process of blending, institutional logics are transformed and dimensions of diverse logics are combined. More “radical” changes in practices are observed, and practices and narratives of different logics are merged into a new and distinct one (Thornton et al., 2012). In contrast, in the process of assimilation, the majority of prevailing practices remain and elements of one logic are combined into a prevalent logic. As Thornton et al. (2012:166) note, “assimilation does not imply passive acceptance” of practices of other logics. However, existing logics provide narratives to guide resistance against a new logic. The application of MCSs embedded within this institutional environment is characterised by specific cultural framework conditions (Lounsbury, 2008). Indeed, the implementation and application of management control instruments depend on the prevailing institutional culture. As Ahrens and Khalifa (2015) as well as Lounsbury (2008) state, institutional logics directly influence the respective MCSs. Furthermore, according to Schäffer et al. (2015), MCSs help to cope with institutional complexity. However, the reconciliation of distinct logics is described as a viable strategy to maintain legitimacy (Pache and Santos, 2013).
2.3. Research questions
As argued in the motivation (section 1.) and based on the systematic literature reviews (section 2.1.), the research interest regarding sustainability reporting is to gain a better understanding of universities’ compilation of SRs concerning the aspect of materiality and SI, and consequently to improve the information supply of important stakeholder groups. Proponents of sustainability reporting stress its contribution to an increase in transparency and accountability (James, 2015; Malik, 2015; Nickell and Roberts, 2014; Baker, 2010). Critical accounting scholars are sceptical as to whether sustainability reporting does, in fact, improve stakeholder accountability. It is seen as a public-relations endeavour without substance, a greenwashing attempt or a strategic impression management tactic (Burritt and
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Schaltegger, 2010; Gray, 2010; Hopwood, 2009). The mostly voluntary nature of the compilation of SRs leaves room for presenting an organisation in an overly positive way by means of selective, incomplete and biased disclosures (Cho et al., 2015) (see Paper One in Appendix 1). The content principles of materiality and SI are seen as a remedy for this issue, making SRs more relevant for stakeholders. The role of materiality and SI in SRs is attracting increasing attention, and prior empirical studies have primarily focused on for-profit organisations. Empirical studies in this field do not compare the listed material aspects with their coverage in the SRs. Additionally, SI and SE in SRs within the university sector have rarely been studied, as shown in the systematic literature review. Based on the research objectives and addressing the research gaps identified, the following research questions (RQs) are pursued: Paper One: Assessing the materiality of university G4-sustainability reports RQ1: What are material aspects for internal and external stakeholders documented in the G4-SRs of
universities? RQ2: How are the documented material aspects covered by G4 reports? Paper Two: Assessing Universities’ Global Reporting Initiative G4 Sustainability Reports in Concurrence with Stakeholder Inclusiveness RQ1: What are the main stakeholder groups and topics of universities identified by SE indicators of
Global Reporting Initiative (GRI) G4? RQ2: To what extent do universities comply with the GRI G4 Guidelines (general and specific standard
disclosures), and how are the documented main topics of the SE-process covered by G4 reports? Whilst Paper One and Paper Two focus on sustainability reporting as an instrument of accountability towards important stakeholder-groups, Paper Three addresses how universities deal with institutional complexity through the application of MCSs. As mentioned above (section 2.1.), no comprehensive investigation of the implementation and application of MCSs in public universities was identified. Furthermore, research regarding MCSs as a package in the context of institutional complexity is lacking. Moreover, no research was found addressing the question of how universities cope with the existence of different (competing) logics through the application of MCSs and which narratives are used to ‘make
sense’ (Thornton et al., 2012). Addressing the research gap identified, a key aim of the research field MCSs of public universities is to understand the implementation and application of specific management control types, the intertwining of management control types, and – in the specific case of Austrian public universities – how they use MCSs to cope with the co-presence of different (competing) logics in order to fulfil their traditional core mission to facilitate academic research. Based on the research objectives and the research gaps identified, the following research questions are pursued: Paper Three: Management Control Systems in hybrid universities – The case of Austrian public universities
RQ1: What are the guiding institutional logics at Austrian public universities? RQ2: Which MCSs are applied at Austrian public universities in the area of research management? RQ3: How do Austrian public universities cope with the existence of (competing) logics through the
application of MCSs?
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3. Epistemology and methodology
3.1. Epistemology
This dissertation follows the epistemology of social constructivism. Stakeholder theory, the theory of sociological institutionalism, and the concept of institutional logics are applied to explain universities’ behaviour in dependence on the social context and the culture they are embedded in.
3.2. Methodology
In order to answer the RQs of this dissertation, methodological triangulation was applied, combining systematic literature reviews with quantitative and qualitative research methods: the first and the second paper combine content analyses (qualitative and quantitative) of the documented material aspects with a correlation analysis. The third paper combines in-depth interviews with the analysis of legal regulations (Table 5 provides an overview):
Sustainability reporting of universities MCSs of public universities
Paper One:
Assessing the materiality of university G4-
sustainability reports
Paper Two:
Assessing Universities’ Global Reporting
Initiative G4 Sustainability Reports in
Concurrence with Stakeholder
Inclusiveness
Paper Three:
Management Control Systems in hybrid
universities – The case of Austrian public
universities
Methodological approaches
Systematic literature review Systematic literature review Systematic literature review
Qualitative and quantitative content
analyses
Qualitative and quantitative content
analyses
Qualitative content analysis of legal
regulations
Correlation analysis Correlation analysis Qualitative expert interviews
To answer the RQs of the first paper, all GRI-G4-SRs of universities uploaded in the GRI-database up to the end of April 2018, i.e., 33 SRs (full census), were analysed in order to examine the implementation of the content principle of materiality and the coverage of material aspects in universities’ SRs (see Paper One in Appendix 1). In order to reveal differences in the CRs due to the sample characteristics (size, ownership, ranking or membership of the Higher Education Sustainability Initiative (HESI)), t-tests at a significance level of 0.05 were carried out. To ensure the reliability of the qualitative and quantitative content analyses, coding categories and clear decision rules were established, and two persons carried out the coding independently. In order to identify the material aspects for internal and external stakeholders documented in the GRI-G4-SRs (RQ1, Paper One), a qualitative content analysis was carried out. The material aspects of each university (disclosure titles G4-17 to G4-22) were listed by analysing materiality matrices and text elements. The identified aspects were clustered into four material subcategories (economic, environment, social and education/research) and divided into 15 material dimensions. Finally, information on the relevance levels of the subcategories was collected. As shown in the results of Paper One, the material subcategory education/research is not mentioned in the GRI-G4-Guidelines, therefore the dimensions were inductively identified (campus life, student mobility, teaching, research, student diversity and student engagement). For each material subcategory and dimension, a CR was calculated (see Paper One in Appendix 1). In order to identify the coverage of the material aspects (RQ2, Paper One), a quantitative content analysis was performed, and the CRs of the material subcategories and dimensions were calculated. Further, the relevant indicators for each
Table 5: Overview of the methodological approaches of the core publications
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identified material dimension were aggregated. Finally, a correlation analysis between the relevance of a material dimension and its CR in the SR was conducted, formulating two hypotheses (there is no/a correlation between the two groups; the evaluation of stakeholders regarding the relevance of the material dimension x is not/is related to the coverage of the reported indicators). In order to interpret the results, the Spearman correlation coefficient was used. If the p-value was below the significance level of 0.05, the null hypothesis was rejected and means that the extent of reporting on the specific material dimension in the SR is aligned with the respective relevance level assigned to the material dimension. If there is a negative correlation or no correlation, the documented material dimension is not reported accordingly. To answer the RQs of the second paper, i.e., examining universities’ main stakeholder groups and topics identified by SE-indicators as well as investigating the CRs of the documented main topics of the SE-process, the sample described above was used (see Paper Two in Appendix 2). Using a qualitative content analysis, the GRI-G4-Guidelines’ disclosure titles G4-24 to G4-27 (SE) were examined in order to identify universities’ SE-activities, the addressed stakeholder groups and the main topics communicated. Therefore, the stakeholder groups and topics were identified, clustered and summarised (RQ1). In order to answer RQ2 of the second paper, a quantitative content analysis was carried out. Based on its results, the SRs-compliance rates for the GRI-G4-Guidelines’ General Standard Disclosures as well as for the Specific Standard Disclosures (such as economic, environmental and social, with its subcategories of labour and decent work, human rights, society and product responsibility) were calculated. For each category, a compliance level was calculated. These were divided into the four categories and a correlation analysis between the main communicated topics and their compliance levels was performed. For strategic management, the General Standard Disclosures, for finance, the CR of the category economic, and for sustainability the CR that is in line with the TBL principle were used. The other high scoring SE-topics identified, such as research information, education programmes and campus life could not be included in the regression analysis, because the GRI-G4-Guidelines do not cover these topics. After all, hypotheses were formulated (there is no/a correlation between the two groups; the identified main communication topic does not influence/influences the coverage of this topic in the report content of the SRs). To interpret the results of these correlations, the Spearman correlation coefficient was used. If the p-value was below the significance level of 0.05, the null hypothesis was rejected and a positive correlation exists. In order to answer the RQs of the third paper, qualitative research methods were applied. Austrian public universities legal regulations were analysed and in-depth expert interviews with the research management were conducted (see Paper Three in Appendix 3). Due to the absence of previous studies in this field, an exploratory approach was chosen. The aim was to investigate all 22 public universities in Austria. Due to random acceptance, 15 semi-structured in-depth interviews with 17 experts from 14 universities were conducted (Bortz and Döring, 2016). The vast majority of the interviewees was top management, e.g., the vice-rector of research (Dai et al., 2016; Guest et al., 2006). An interview lasted between 60 and 90 minutes on average, these were carried out in person or by telephone and digitally recorded. Thereafter, they were transcribed with permission by the interviewees (Mayring, 2015). For the analysis, deductive and inductive categories were derived – the former were based on MCSs as a package by Malmi and Brown (2008); adopted classification proposed by Conrath-Hargreaves and Wüstemann (2019), Boitier and Rivière (2016), and Thornton et al. (2005) in order to analyse how public universities cope with the co-presence of different (competing) logics.
June, 2021 Judith Frei 22/45
4. Key results of the publications
The three papers of this dissertation provide insights in universities’ roles in contemporary society. In fulfilling their missions, this dissertation selected sustainability reporting as an instrument of public sector accountability and additionally universities’ MCSs of Austrian public universities to understand, how universities cope with the evolved institutional complexity. The key results are presented in the following.
4.1. Results: Sustainability reporting of universities
Paper One: Material aspects in universities’ SRs
To answer the research questions of the first paper, 33 GRI-SRs worldwide were analysed to investigate the implementation of the content principle of materiality and the coverage in universities’ SRs (see Paper One in Appendix 1). The qualitative analysis identified the following four subcategories and 15 material dimensions. The subcategories and dimensions are 1. economic: economic performance; 2. environment: resources, waste/recycling, emission, biodiversity; 3. social: labour employment/diversity,
human rights, society, product responsibility; and 4. education/research (additional subcategory): campus life, student mobility, teaching, research, student diversity and student engagement. 16 of the studied SRs include materiality matrices; the other 17 SRs provide narratives of material aspects. Results show that 76 per cent of the universities rate the subcategory economic as material and, more specifically, about 50 per cent rate the material dimension economic performance as highly relevant. With 73 per cent of all universities, the subcategory social is the second most mentioned; the most frequently mentioned dimension herein is labour employment/diversity with 85 per cent. As the third-most named, environment is rated as a material subcategory by 42 per cent of the universities, the dimension of waste/recycling is the most frequently mentioned with 61 per cent. 27 per cent rate the inductively derived subcategory education/research as material; the most frequently mentioned dimension relates to teaching with 64 per cent, even 50 per cent rank this dimension as highly relevant. The material subcategories and material dimensions receive similarly high relevance marks by internal and external stakeholders, showing the highest relevance for the subcategory social (47 per cent), followed by economic (46 per cent), environment (27 per cent) and education/research (20 per cent). Coverage of material aspects in universities’ SRs (Table 6)
Regarding CRs, the dimensions labour employment/diversity, resources, human rights and economic
performance rank highest. The lowest CRs is found for biodiversity and product responsibility:
CRs economic
perfor-mance
resources waste/
recycling emission
bio-diversity
labour employ-
ment/ diversity
human rights
society product respon-sibility
no coverage 3 0 0 11 17 7 4 7 4
0,01 % to 33,33 % 13 7 17 4 16 6 9 15 15
33,33 % to 66,66 % 8 14 9 9 2 1 9 4 8
> 66,67 % 9 12 7 9 8 19 11 7 6
Table 6: Overview of the material dimensions and their coverage rates
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Table 7: Overview of the specific standard disclosures’ total coverage rates
Only in the case of the material dimension biodiversity does a statistically significant correlation for internal and external stakeholders exist, and the extent of reporting on biodiversity is aligned with the respective relevance level assigned to this dimension. Concerning internal and external stakeholder-groups, the evaluation of biodiversity as a material dimension influences the coverage of this topic (middle positive correlation in both cases). Concerning the other 14 material dimension, results show no statistical significance between the identified material aspects and their CRs.
Paper Two: Universities’ main stakeholder groups and topics
To answer the research questions of the second paper, 33 GRI-SRs worldwide were analysed to identify the main stakeholder groups and topics as well as their CRs in universities’ SRs (see Paper Two in Appendix 2). The main stakeholder groups identified are the university assembly (i.e., the head of the university, the head of departments and the university council; 93 per cent of the universities report to them), university staff (scientific and non-scientific), students and the government. Parents (37 per cent) and public media partners (33 per cent) are addressed more rarely. The topics mainly addressed concern strategic management (vision, strategic objectives and upcoming strategic changes), sustainability, education programmes, research information, campus life, finance and legal issues.
Compliance with general and specific standard disclosures and documentation of main topics
Strategic management information and information on universities’ profiles are included in the general standard disclosures: 30 per cent of the universities show a CR between 80 and 100 per cent, another third between 60 and 79 per cent, and 40 per cent have a rate between 40 and 59 per cent. No university shows a CR under 40 per cent of the general standard disclosures. Furthermore, the CRs within the six specific standard disclosures were analysed (economic, environmental, society, human rights, social - labour practices/decent work and product responsibility). Within the economic category, 47 per cent of the universities report more than 50 per cent of indicators of this category. 33 per cent of the SRs’ show a CR of more than 50 per cent for the environmental indicators. For the category social – labour practices and decent work, 50 per cent of all SRs have a CR of over 50 per cent. In terms of the categories of social – human rights, society and product responsibility, 27 per cent of the investigated universities report more than 50 per cent of the indicators. The analysis shows that the specific standard disclosures exhibit the top CRs, specifically the social dimension with the sub-indicators labour practices and decent work and economic and environmental performance. Concerning the TCRs, 24 per cent show a coverage between 80 and 100 per cent, 6 per cent a coverage between 60 and 79 per cent, 12 per cent a coverage between 40 and 59 per cent, 48 per cent a coverage between 20 and 39 per cent, and 9 per cent of the examined universities show a coverage below 20 per cent of the indicators (see Table 7).
TCR amount per cent
100 % - 80 % 8 24,24 %
80 % - 60 % 2 6,06 %
60 % - 40 % 4 12,12 %
40 % - 20 % 16 48,48 %
20 % - 0 % 3 9,09 %
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The correlation analysis of the main stakeholder topics shows no statistical significance. The main communication topics of the SE-process identified are not covered adequately.
4.2. Results: Management control systems of universities
Paper Three: Underlying legal regulations
The Universities Act of Austria (2002) legally mandates Austrian public universities’ principles and responsibilities as well as financing and university governance (see Paper Three in Appendix 3). Austrian public universities have to compile and publish ICRs that present the sphere of action, the intellectual capital, and the performance processes defined in their performance agreements. Performance agreements must establish quantitative and qualitative performance measures to be included in the ICRs. Considering the expected number of students and the ratio of students per professor, the federal government funds Austrian public universities based on a three-year performance agreement, which includes universities’ development plans as their strategic planning instrument. By means of research information systems, all research efforts are collected and monitored by the rectorates and the ministry. Universities’ governing bodies are the university council, the rectorate, the rector and the senate (see Paper Three in Appendix 3). Guiding institutional logics of Austrian public universities and applied MCSs
Content analysis confirmed the institutional field-level logics identified by Conrath-Hargreaves and Wüstemann (2019) (academic logic, government logic and business logic). The most salient of these is academic logic. Austrian public universities stress academic freedom in research and teaching with a maximum of autonomy. The maintenance of motivation by the provision of resources, decentral decision structures, the establishment of research cooperations and peer-reviews in order to enhance research performance are central characteristics of their core values. Furthermore, universities strive to achieve economic and social goals defined by the state (government logic). Business logic is expressed by the awareness of competition principles. Performance and positioning in the (international) scientific community plays a central role at universities, not only within the research community but also in terms of the allocation of financial resources. The selection and application of management control types at Austrian public universities depend on the level of control considered. Content analysis revealed the global, the institutional, and the individual level of control. The global level defines universities’ strategic aims concerning research profile as set out in the development plan. At the institutional level, targets are agreed and resources are distributed between the rectorate and faculties, departments, institutes or centres. At the individual level, resources are allocated between rectorate, faculties, departments, institutes or centres and researchers, At the global level of control, control types are applied depending on the identified logics: Guided by academic logic, the most frequent control type is planning intertwined with administrative and cultural controls. Determined by government logic, planning instruments are interlinked with cybernetic and administrative controls. Led by business logic, the most salient management control type is administrative, followed by cybernetic controls. At the institutional level, the identified logics are still noticeable, although not mentioned explicitly: government logic guides the application of planning linked with cybernetic and administrative controls. At the individual level of control, planning instruments are closely intertwined with cybernetic controls. Furthermore, a broad variety of reward and compensation instruments is applied at the individual level. Administration and provision of resources constitutes a key
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prerequisite at Austrian public universities. Increasingly, corresponding measures are applied in case of deviation, ranging from peer reviews and external consulting to reductions in personnel and salary, but may also result in the decision to not fill job vacancies or to not remove the time limit for approval (see Paper Three in Appendix 3).
Coping with competing logics in the application of MCSs
Content analysis revealed that universities utilize four coping strategies. First, interviewees demonstrate their disagreement, although controls are not decoupled from the governmental prescribed. A second coping strategy is expressed by the adaption of performance indicators at the global level of control. The third coping strategy becomes obvious by applying key performance indicators as a university-internal control instrument and the translation of the performance agreement into measurable objectives communicated to the individual units, while simultaneously highlighting the importance of intrinsic motivation. After all, some interviewees demonstrate a clear commitment to the requirements issued by the government and deploy performance indicators as university-guiding control instrument. Moreover, interviewees try to find consensus between the identified logics: the consensus between government and academic logic is sought most strongly, followed by academic and business logic, and government and business logic (see Paper Three in Appendix 3).
5. Integrated discussion, contribution to the academic debate, practical implications, and directions for further research
5.1. Integrated discussion
In order to explore the impact that NPM reforms have had and continue to have on universities, this dissertation combines two research topics, sustainability reporting and MCSs of universities. Public universities meet their responsibilities to modern society on whose behalf they are deployed. Embedded in a complex environment, universities fulfil their missions while concurrently meeting their responsibilities to internal and external stakeholder groups. The stakeholder audiences who hold universities’ management accountable have increased considerably (e.g., ministries, other research funders, current and potential students and staff, business partners, employers of graduates, alumni) (Ntim et al., 2017) (see Paper One in Appendix 1). In order to understand how universities try to meet their obligations and to fulfil their internal and external stakeholders’ expectations and information needs, the instrument of (voluntary or non-voluntary) sustainability reporting was selected and the content principles of materiality and SI were analysed. Universities’ SRs represent an instrument of public stakeholder accountability and contribute to fulfil universities’ missions, because it is in these that universities explain and take responsibility for their sustainability efforts. A key form of legally binding accountability in Austria is the compilation of ICRs. Here, performance-driven ministerial steering (Habersam et al., 2013) influences the university-internal configuration of MCSs which are applied to accomplish universities’ missions and thus to fulfil societies’ tasks. Powerful resource-providers demand accountability reports tailor-made for their specific claims. In summary, the dissertation seeks to understand universities’ responses to the increasing requirements and their concomitant actions by gaining insights into their sustainability reporting practices and their applied MCSs.
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Beside their core missions of research and teaching, universities are increasingly required to address growing societal and economic challenges. Knowledge from research and teaching will be used to fulfil their third mission in society and economy in order to solve societal challenges and provide knowledge by cooperation’s with external stakeholders. Trencher et al. (2014) provide evidence for a fourth mission, i.e., “co-creation for sustainability”, where universities collaborate in order to advance the “sustainable
transformation of a specific geographical area or societal sub-system” (Trencher et al., 2014:151). Therefore, universities engage in a variety of (voluntary and obligatory) activities, including sustainability and intellectual capital reporting. Sustainability has gained relevance for the university sector, which is confronted with the expectation of playing a key role in creating new mental paradigms towards a more sustainable world (Ntim et al., 2017; Alonso-Almeida et al., 2015). The United Nations Global Compact (UNGC, 2012:8) stresses that HEIs need to shift “from short-term corporate visions to a broader, multi-
stakeholder focus”. A number of universities have self-committed to sustainability development by signing international declarations (Alonso-Almeida et al., 2015). Sustainability reporting is seen as an integral element of universities’ sustainability efforts (Alonso-Almeida et al., 2015; Lozano et al., 2015). By introducing the Universities Act of Austria in 2002, “[t]he underlying idea of governance combines
autonomy with accountability and public legitimation” (Habersam et al., 2018:35). In order to accomplish their “third mission”, universities have to “navigate multi-stakeholder ecosystems” and “[t]he Ministry
understands the mandatory KBS [knowledge balance sheet] as a suitable tool with which to present
relevant information on how universities achieve their purposes” (Habersam et al., 2018:35). Accountability reporting instruments are seen as appropriate instruments to control and monitor universities’ efficient goal achievement and to supply information to important stakeholder groups. While the provision of SRs, with the exception of the Spanish province of Andalusia, is voluntary for universities worldwide, the mandatory compilation of ICRs has far-reaching consequences for the selection, implementation and application of MCSs for the university-internal control systems at Austrian public universities. The first paper examines material aspects for internal and external stakeholders. As shown in Paper One, significant differences among the inclusion rates were found (see Paper One in Appendix 1). The subcategories economic and social both achieved much higher relevance levels from internal and external stakeholder groups than environmental and education/research. The low level of inclusion of the subcategory education/research is in line with other empirical studies (Sassen and Azizi, 2018a; 2018b; Lopatta and Jaeschke, 2014; Fonseca et al., 2011), indicating that SRs are not seen as an instrument to communicate universities’ efforts and achievements concerning their key capabilities. Following universities’ traditional core missions, as well as their third- and fourth mission agendas, this is a problematic sign at first glance, because it clearly shows that SRs are not seen as a suitable reporting instrument for these areas and may never fulfil this function. Evidently, there are other voluntary accountability clubs or obligatory communication channels (e.g., university rankings or ICRs) providing more focused information. In the Austrian case, the legally standardised performance agreement comprises universities’ development plans, including universities’ research profile and, more specifically, their sphere of action, their intellectual capital and their performance processes. For instance, Austrian public universities’ development plans include sustainability aspects (e.g., the development plans of University of Vienna 2028, University of Innsbruck 2019 - 2024, University of Graz 2019 - 2024, and University of Linz 2022 - 2027). Although all analysed SRs provide information on stakeholder relevant aspects and their relevance levels, these topics do not serve as a content-selection principle, as the examination of RQ2 of Paper One has shown, with the exception of the material dimension biodiversity. The materiality principle can be interpreted as a ticking-off exercise (see Paper One in Appendix 1). Nevertheless, universities clearly document their main stakeholder groups and their
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heterogeneous information needs (see Paper Two in Appendix 2). The relevant topics concern general management issues and university-specific agendas. Moreover, sustainability is regarded as highly relevant. Again, the identified communication topics are not covered sufficiently in the SRs and the analysed universities are far off guideline compliance. Viewed from the theoretical point of view, universities’ SRs are not used for the purpose suggested by strategic stakeholder theory. As stated in section 2.2.1., the understanding of the concerns of universities’ strategic stakeholders will lead to receiving the necessary support (Harrison, 2013; Freeman, 1984). The small number of SRs available (33 SRs) and the poor CRs show that sustainability reporting is not yet an institutionalised practice. Furthermore, there is a substantial gap between the information needs of internal and external stakeholder groups on material aspects and the actual supply of information by the SRs. It can be concluded that the sustainability reporting practice is far from achieving holistic stakeholder accountability (Puroila et al., 2016). From the theoretical view of sociological institutionalism, the GRI-Guidelines (due to their voluntary nature) exert weak pressure (Shabana et al., 2017; Bebbington et al., 2009), leaving the degree of implementation and the CRs at the discretion of the universities which have advanced sustainability reporting. Universities are de facto not exposed to mimetic pressure to imitate successful peers. Moreover, the GRI does not have sanctioning power in case of low compliance. Consequently, the required documentation in GRI-G4-Guidelines’ disclosure title G4-19 is reduced to a symbolic exercise without any substantial impact on the content of the SRs (see Paper One in Appendix 1). The investigation has shown that universities do not use SRs as an instrument to serve stakeholder information needs and thereby achieve greater accountability in the spirit of their missions (see also Diouf and Boiral, 2017; Puroila et al., 2016; Ceulemans et al., 2015b; Lozano et al., 2015; Deegan and Rankin, 1997). Unlike obligatory ICRs, important stakeholder groups of Austrian public universities (e.g., national legislators or financial resource providers) do not demand the compilation of SRs. After all, important stakeholder groups (the university assembly, scientific and non-scientific university staff, students, government, parents and public media partners) are mentioned in universities’ SRs and sustainability is a highly relevant communication topic (see Paper Two in Appendix 2). However, their pressure does not seem strong enough to enforce an adequate provision of sustainability information. Nevertheless, national accountability requirements are very specific and differ between the countries, which may hinder the mutual deployment of a sector-neutral worldwide sustainability reporting standard. The increased complexity of requirements, as outlined above, has not left universities’ traditional self-image unaffected. Given Austrian public universities historical tradition, academic freedom in research and teaching represents universities’ uppermost maxim. As stated above, knowledge from research and teaching will be used to fulfil universities’ third mission in society and the economy to solve societal challenges and provide knowledge in the form of cooperation’s with external stakeholder groups. From the theoretical perspective of institutional logics, the investigation of Paper Three has shown that universities’ mission of academic research to provide knowledge is centrally guided by academic logic. This is also reflected on a global level of control by the intertwining of development planning, establishing research foci, and the appointment of professors. Reliance on high personal and individual responsibility guides the research strategy at the global level of control. Down to the institutional level of control, control types are increasingly guided by government logic, as the intertwining of target and qualification agreements with cybernetic and administrative controls indicates. Reward and compensation instruments gain importance on the individual level of control. Guided by business logic, Austrian public universities see themselves as international businesses, market-oriented and competitive with efficient
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goal achievement, striving for financial income achieved by the acquisition of high-grade competitive research grants. This shows the discrepancy to which Austrian public universities are exposed. The co-existence and experienced competition of academic, government and business logic leads them to new practices made, in part, of the prevalent logic. Obviously, traditional material practices have changed, and the new logics have induced a shift between the identified logics (Busco et al., 2017; Dai et al., 2016; Thornton et al., 2012). Austrian public universities do, of course, comply with legal requirements, but the actual extent of implementation and the university-internal fine-tuning of legal requirements differs between the universities studied (see Paper Three in Appendix 3). This finding is particularly interesting, because indicators and rankings (e.g., in the form of benchmarks) are sometimes employed for university-internal purposes in a more sophisticated way than required. However, the implementation practice is not superficial and far removed from loose coupling. External stakeholders (resource providers) exert power not only by claiming the provision of information, but as an ‘extended arm’ by influencing university-internal decision-making structures. Managerial practices are imported by Austrian public universities’ and adapted for internal purposes but are not fully accepted without contradiction. The investigation showed that universities’ coping strategies with these contradictions differ in the way of sense-making to facilitate concurrent resistance and assimilation as well as finding a consensus by means of narratives (Townley, 1997) (see Paper Three in Appendix 3). Austrian public universities integrate management control practices of newly emerged logics into their prevalent academic logic, resulting in hybrid practices (Thornton et al., 2012). The process of assimilation shapes their narratives around national requirements and competition by which they try to seek a consensus. In summary, the universities’ stakeholder orientation and stakeholder accountability have become more complex in quantity and, presumably, also in quality. The multiplication of crucial stakeholders has led to more hybrid models of university governance and reporting where universities have to position themselves on the global market for higher education (Jongbloed, 2015). Sustainability reporting is one voluntary instrument for addressing increased stakeholder accountability. Sustainability assessing and reporting to key stakeholders is an integrated element of models for a sustainable development in universities (Alonso-Almeida et al., 2015; Lozano et al., 2015; Lozano, 2006). However, as the results of this dissertation have shown, sustainability reporting is still an emerging practice. Furthermore, stakeholder-relevant aspects are not depicted sufficiently in the SRs, therefore this instrument is not used for stakeholder accountability purposes. Besides, due to their voluntary nature, the GRI-Guidelines exert weak pressure and the content-selection principles of materiality and SI deteriorate to a task of diligence. On the other hand, the Universities Act of 2002 introduced accountability in Austria, and the legislator determines the content to be included in the ICR. However, a far-reaching impact on the university-internal selection, implementation, and application of MCSs can be observed. Performance-driven ministerial steering (Habersam et al., 2013) has a strong impact. These practices are integrated through the process of assimilation and are argued consensually (“[I]t’s about a balancing act”, as one interviewee put it). The legally determined accountability instrument of intellectual capital reporting fundamentally affects Austrian public universities’ beliefs and guiding principles concerning universities’ self-concept, understanding of control as well as university structure and the applied MCSs. Given the impact of NPM, Austrian public universities see themselves exposed to a plethora of (contradicting) demands, challenging them to fulfil a multiplicity of requirements concurrently, and leading them to use coping strategies in order to maintain their hybrid nature.
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5.2. Contribution to the academic debate, practical implications, and directions for further research
Universities contribute to the welfare of society and environment, making the advancement of knowledge one of their core missions. Moreover, universities play a key role in creating new mental paradigms towards a more sustainable world (Ferrero-Ferrero et al., 2017). To serve academic research and research-led teaching represent universities’ key capabilities. Although universities have a broad societal mission and are exposed to a rather pluralistic stakeholder structure, holding universities’ management accountable, few studies have analysed sustainability reporting and its contribution to transparency and accountability and the impact of accountability pressures on the use of university-internal MCSs to accomplish this mission. More precisely, studies concerning the increasing relevance of SRs for the addressed stakeholder groups and comparisons between the identified stakeholder material aspects and their coverage in the SRs are lacking. Furthermore, the content principle of SI and the coverage of the SE-process are even lesser addressed topics (Ferrero-Ferrero et al., 2017; Hinson et al., 2015). In the research context of institutional logics and HEIs, a small number of empirical studies exists (e.g., Dobija et al., 2019; Gebreiter and Hidayah, 2019; Grossi et al., 2019). No prior study was found combining MCSs and institutional logics in the public university context. Hence, by analysing all GRI-G4-SRs of universities worldwide, this dissertation empirically contributes to the academic debate by focusing on the content and implementation principles of materiality and SI. Furthermore, this is the first study to analyse the coverage of stakeholder material aspects in GRI-G4-SRs and address the question whether the identified and documented material aspects actually guide the reported content. Additionally, this dissertation contributes to the research field sustainability reporting as an important part of stakeholder communication and management requiring effective SE, stressing participative inclusion of stakeholders and taking into account their expectations in the SRs (Ferrero-Ferrero et al., 2017). This dissertation extends previous research in two ways: first, by focusing on the fit between the documented material topics and their respective CRs in universities’ SRs in the SE-process; second, by addressing the research question whether the relevant topics identified in the SE-process actually guide the content of the GRI-G4-SRs. Additionally, this dissertation raises awareness beyond the university sector of the debate on materiality and SI in sustainability reporting, suggesting a serious dialogue with stakeholders to enhance the quality of SRs. Concerning the research topic of MCSs as a package, this is the first study to analyse MCSs in the situation of institutional complexity at public universities. This dissertation thus extends previous research by drawing on the perspective of institutional logics to facilitate the understanding of public universities’ coping strategies when implementing and applying MCSs. From a theoretical point of view, this dissertation contributes to academic research by demonstrating that the expectations in line with strategic stakeholder theory are not met. Sustainability reporting is not an institutionalised practice and materiality and SI as content-selection principles deteriorate to a ticking-
off exercise. Universities pay lip service to materiality as a content-selection principle, while their actual practices are far removed from achieving holistic stakeholder accountability. From the theoretical perspective of sociological isomorphism, this dissertation shows that the GRI-Guidelines do not hardly exert any pressure leaving ample room for manoeuvre to the universities’ implementation practices. Sustainability reporting practices do not, in fact, meet the institutional expectations of important stakeholder groups as documented in the materiality matrices. Due to a lack of sanctioning power, missing entrance requirements, a lack of peer visits, and a low diffusion rate of GRI-G4-SRs, isomorphism does not work. Therefore, stronger incentives must be provided for universities, which
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remain at a very early stage of sustainability reporting. From the point of view neither of strategic stakeholder theory nor with regard to isomorphism universities can be seen as using the instrument of sustainability reporting in order to achieve social acceptance, the support of strategically relevant stakeholders, and for gaining or maintaining legitimacy. Universities do not even superficially adopt sustainability reporting practices in order to pretend conformity (Meyer and Rowan, 1977); rather, they purposefully enact specific selected practices (e.g., the provision of materiality matrices and the identification of main stakeholder groups and topics), while not applying the principles consistently by covering the information in the SRs. This dissertation shows that sustainability reporting allows universities to satisfy symbolic concerns and therefore to escape an institutional conflict by a narrative
selective coupling strategy. Furthermore, on the theoretical level, this dissertation contributes to academic research by revealing Austrian public universities MCSs. Universities’ underlying different, conflicting roles becoming evident in their structures and management control practices (Jones et al., 2013). Additionally, at the level of control, a logic-hierarchy could be determined. Normative academic logic centrally guides Austrian public universities self-concept at a global level of control by the rectorate. Down to the institutional level of control, coercive pressure is becoming increasingly noticeable and government logic is beginning to be more dominant. Market principles have begun to play a key role in the university sector by the necessity to generate grants income. Sometimes, market logic acts as a mediator between academic and government logic. By means of hybrid practices derived from the different logics, Austrian public universities succeed in manoeuvring through the different levels of control resulting in specific MCSs-packages, as this dissertation shows. By narrative compromising, Austrian public universities facilitate resistance and assimilation concurrently (Townley, 1997) and therefore reconciliate multiple (conflicting) logics. This dissertation also has practical implications. Concerning the content-selection principles, standard setters should provide clear guidelines and a user-friendly manual on how to report specific indicators. In case of the content principle of materiality, the role of the materiality matrix must be well introduced, enabling the users to adapt the materiality principle in its core. This may be a starting-point to improve the GRI-Guidelines (GRI, 2016) towards greater stakeholder accountability. Moreover, preparers of SRs should make better use of the information they collect from highly or medium salient stakeholders in the SE-process. A focus on highly relevant material topics in reporting would improve stakeholder orientation in the field of sustainability reporting. Sector-specific indicators are also included in obligatory reports (e.g., ICRs), therefore standardisation would enhance comparability. As the analysis has shown, cybernetic controls are seen critically and there is awareness – which should be fostered and maintained – that organisational culture is the strongest driver of employees’ motivation, which has to be supported by the provision of resources, administrative controls (e.g., supporting networking) and collegial support (Tucker and Tilt, 2019; Sutton and Brown, 2016; Edgar and Geare, 2013). In order to analyse the communication of sustainability performance, further research could be extended to other communication channels, e.g., in the case of Austria public universities’ development plans. In general, it might be worthwhile to analyse the function of SRs compared with other university sector-specific accountability instruments (e.g., websites or press releases). Furthermore, it would be interesting to analyse the entire range of universities’ tasks (e.g., teaching) and to examine the efficiency and effectivity of MCSs in this context.
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A major limitation of the study relates to the small number of SRs (33 SRs). Furthermore, the study of Paper Three focused on research; consequently, teaching and third or fourth mission agendas are not considered. In order to analyse the impact of the implementation of MCSs future research should include longitudinal studies and integrate the perspective of the affected researchers. Furthermore, the mutual reinforcement of commonly seen conflicting logics at public universities (e.g., academic and business logics) offers an interesting field of research (e.g., whether department funds are allocated in order to support research in potential fields).
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Appendix 1
Paper One: Lubinger, M., Frei, J. and Greiling, D. (2019), “Assessing the materiality of
university G4-sustainability reports”, Journal of Public Budgeting, Accounting & Financial
Management, Vol. 31 No. 3, pp. 364-391.
Assessing the materiality ofuniversity G4-sustainability reports
Melanie Lubinger, Judith Frei and Dorothea GreilingInstitute for Management Accounting, Faculty of Social Science,
Economics and Business, Johannes Kepler University Linz, Linz, Austria
Abstract
Purpose – Materiality, as a content-selection principle, is an emerging trend in sustainability reporting formaking sustainability reports (SRs) more relevant for stakeholders. The purpose of this paper is to investigatewhether materiality matters in the reporting practice of universities which have adopted the Global ReportingInitiative G4 Guidelines.Design/methodology/approach – Strategic stakeholder theory and sociological institutionalism serve forderiving conflicting expectations about the compliance of universities with the materiality principle. In theempirical section of this paper, content analyses are conducted on the documented material aspects, followedby a correlation analysis for examining to which extent the identified material aspects are reported in the SRs.Findings – Although universities document G4-19 stakeholder-material aspects according to differentrelevance levels and for internal and external stakeholder groups, the identified material aspects are notappropriately reported in the SRs. The adoption of the materiality principle is a superficial one and thereforemore in line with the expectations of sociological institutionalism.Research limitations/implications – The main limitation for this study is the small number of universitySRs available. The chance to make SRs more relevant by focusing on stakeholder-material aspects is not used.Originality/value – This paper reports the first study looking at the compliance between the documentedmaterial aspects and the content of SRs in a particular challenging organisational field, the university sector.This paper also adds to the emerging theoretical discussion about the extent universities implementmateriality in SRs.Keywords Materiality, University, Global reporting initiative, Sustainability report,Sociological institutionalism, Strategic stakeholder theoryPaper type Research paper
1. Motivation and research questionsSustainability reporting has gained relevance in the past 20 years, especially in stockexchange listed for-profits (Cho et al., 2015). Proponents of sustainability reporting stress itscontribution to transparency and accountability, in particular with regard to environmentaland social impacts (Burrell and Roberts, 2014). Critics see sustainability reporting as a publicor investor relations endeavour without substance, a greenwashing attempt, a strategicimpression management tactic or a management fad which will disappear over time (Burrittand Schaltegger, 2010; Gray, 2010; Hopwood, 2009). The voluntary nature of sustainabilityreporting makes room for incomplete and biased disclosures, strategically omitting potentiallydamaging information and over-reporting positive aspects (Cho et al., 2015).
As a remedy to make sustainability reports (SRs) more relevant for stakeholders,materiality has emerged as a fairly new content principle for SRs (Diouf and Boiral, 2017;Eccles et al., 2012). SRs should focus on those aspects which stakeholders regard as materialfor their decision making (Calabrese et al., 2016). Materiality aims at terminating the practicethat stakeholders are confronted with a vast variety of irrelevant indicators. The GlobalReporting Initiative (GRI) G4 Guidelines have put stakeholder materiality on the centrestage with the expectation that it will lead to shorter, more focused reports, aiming to giveSRs more relevance and greater credibility (Puroila et al., 2016; Unerman and Zappettini,2014). Materiality “is the threshold at which aspects become sufficiently important that theyshould be reported” (GRI, 2013b). G4-19 requires a list of all material aspects andclassifications in accordance to their relevance (low, medium or high) for internal and
Journal of Public Budgeting,Accounting & FinancialManagementVol. 31 No. 3, 2019pp. 364-391© Emerald Publishing Limited1096-3367DOI 10.1108/JPBAFM-10-2018-0117
Received 18 October 2018Revised 7 May 2019Accepted 18 June 2019
The current issue and full text archive of this journal is available on Emerald Insight at:www.emeraldinsight.com/1096-3367.htm
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external stakeholders. The G4-Implementation Manual suggests that material aspects of ahigh reporting relevance should be reported in detail; those with a medium priority shouldbe considered for inclusion and information; those with a low reporting priority arecandidates for exclusion (GRI, 2013a).
In financial reporting, materiality has been an important accounting concept with aplurality of different discourses over time starting at the late nineteenth century. Despitethis long tradition, materiality is still a pluralistic and elusive concept. Based on ahistorical discourse analysis, Edgley (2014) identified divergent roles of materialityranging from pragmatic rules of thumb for preparers and auditors, technical and legalinterpretations of stressing importance or substance for economic decision makers orfocusing on its role as a professional standard, to framing it as a risk managementstrategy. Other concepts define materiality as a political and social process, as a moralresponsibility or as a mystical object with divergent meaning for preparers, users andauditors. Materiality is seen as part of the truth game with a broad variety of figuresof speeches for managing and hiding errors and subjectivities in the translation ofaccounting inscriptions (Edgley, 2014).
Compared to the extensive body of research in financial accounting, the debate ofdifferent frameworks and distinctive roles of materiality in SR is in its early days (Puroilaet al., 2016; Edgley et al., 2015; Jones et al., 2015a; Unerman and Zappettini, 2014). Regardingmateriality in SR, only few empirical cross-sectoral (Diouf and Boiral, 2017; Puroila et al.,2016; Muñoz-Torres et al., 2012; Manetti, 2011), industry specific ( Jones et al., 2016a, b) orsingle-case studies (Calabrese et al., 2016; Janek et al., 2016; Hsu et al., 2013) exist.
Materiality is either seen as a tool for selecting the most important SR aspects ingeneral (KPMG, 2017; Jones et al., 2015a, b; Manetti, 2011), or a concept focused oninformation needs of providers of financial capital (IIRC, 2013; IFAC, 2015) or stakeholders(AccountAbility, 2019; Calabrese et al., 2016; Edgley et al., 2015; GRI, 2013a, b). Mostattempts have a broad user concept by stressing stakeholder orientation. Furthermore,materiality is seen as a part of a company’s risk management for preventing negativeimpacts on business, a business opportunity framework for creating long-term (economic)growth, or as a communication tool for existing sustainability strategies to outsidestakeholders (Puroila et al., 2016). In line with the Burritt and Schaltegger’s (2010)outside-in approach towards sustainability reporting, materiality can serve as alegitimation tool for communicating those sustainability aspects an organisation’snon-management stakeholders are aware of (Puroila et al., 2016).
Empirical, non-university sector findings show that the adoption of materiality in SR isheterogeneous, dominated by a strategic management approach in its early days and aneven more complex and ambiguous concept than in financial accounting (Puroila et al., 2016;Jones et al., 2015a, b; Unerman and Zappettini, 2014). Selectivity and subjectivity ofmateriality are accompanying effects (Unerman and Zappettini, 2014). The present practiceis far away from a holistic, moral and ethical concept of materiality (Puroila et al., 2016).Such a holistic interpretation of materiality would be a great step towards improvedstakeholder accountability in higher education institutions (HEIs). In this line, the UnitedNations Global Compact (UNGC, 2012) stresses that in HEIs a shift “from short-termcorporate visions to a broader, multi-stakeholder focus” is necessary. So far the focus ofmaterial aspects in measuring HEI embeddedness of sustainability in education, researchand community engagement activities is missing (Adams, 2013).
For determining expectations about the implementation of the materiality principle inSRs, this paper builds on two competing schools of thought. Strategic stakeholder theorysuggests to concentrate the reporting content on material aspects of medium or highlysalient stakeholders. Serving the information needs of salient stakeholders aims atproviding a greater transparency and at achieving a better accountability securing for a
365
University G4-sustainability
reports
continuous flow of support and resources (Calabrese et al., 2016; Puroila et al., 2016).Sociological institutionalism is used to build up the counter-argument. Prior researchwhich used sociological institutionalism in the context of sustainability reporting raisedsome doubts whether one can expect more than a low compliance with stakeholderexpectations in SRs due to the voluntary and ambiguous nature of sustainability reportingguidelines and, with the exception of stock exchange listed companies, low diffusion rates(Shabana et al., 2017; Higgins and Larrinaga, 2014; Bebbington et al., 2009). Therefore, thecongruence between the in the SR listed material aspects and the reported content mostlikely will be low.
This paper concentrates on universities for various reasons. Prior empirical studies onthe implementation of the materiality principle have focused primarily on for-profitcompanies. In contrast, universities have a broader societal mandate of providing anintellectual basis for the economic, cultural, political, environmental and social developmentof societies, institutions and individuals (Ntim et al., 2017). The few existing empiricalstudies of the state of the art of SRs in universities (see Section 2) allow no comparisonbetween the listed material aspects and how they are covered. With New PublicManagement, universities are moving towards a market-driven culture and are competingglobally (Parker, 2013, 2011). While public funding is decreasing, this development is notmatched by declining government scrutinies and sector regulations (Guthrie and Neumann,2007). The stakeholder audiences who hold universities’ management accountable haveincreased considerably (e.g. ministries, other research funders, current and potentialstudents and staff, business partners, employers of graduates, alumni) (Ntim et al., 2017).To address this plethora of stakeholders, universities engage in a variety of activities,including SRs. Sustainability reporting has gained societal relevance because societyexpects universities to play a key role in creating new mental paradigms towards a moresustainable world (Ferrero-Ferrero et al., 2017). A growing number of universities havesigned declarations concerning sustainability in higher education. Sustainability reportingis seen as an integral element of universities’ sustainability efforts (Alonso-Almeida et al.,2015; Lozano et al., 2015).
This paper focuses on the GRI G4 Guidelines because they are the most widelyimplemented standard (KPMG, 2017). While the GRI G4 Guidelines have a global outreach,all other sustainability reporting frameworks for universities have a regional focus andtherefore are designed for a narrower environmental context (e.g. Central Europe orNorthern America, Larrán et al., 2016). Furthermore, GRI G4 Guidelines include an explicitdefinition of materiality.
Therefore, the guiding research questions are:
RQ1. What are material aspects for internal and external stakeholders documented inthe G4-SRs of universities?
RQ2. How are the documented material aspects covered by G4 reports?
Regarding RQ1, all current G4 reports of universities uploaded by March 2018 in the GRIdatabase are analysed. The GRI G4 Guidelines demand that in G4-19 a list of materialaspects is provided, either in the form of a materiality matrix or as a narrative. For RQ2, thisstudy evaluates how focused G4-university SRs are on the documented material aspects toevaluate if materiality services as a content-selecting principle matters.
This study contributes to the literature as follows: the paper analyses G4 reportsof universities worldwide, irrespective of their publication language. Additionally,this study contributes to the emerging field of studies focusing on the implementationof the materiality principle. It is the first study which analyses how well in the G4 reportsdocumented stakeholder-material aspects are covered in the SRs. Prior studies so far haveconcentrated on identifying and clustering what is regarded as stakeholder material.
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The findings of our study indicate that universities document what internal and externalstakeholders regard as material and are able to classify the stakeholder-material aspectsinto low, medium and highly relevant ones, but do not concentrate their SRs on the identifiedmaterial aspects. Materiality deteriorates to a “ticking-off” documentation exercise. Theinternal consistency of the SRs between the documented material aspects and the reportedones is low.
2. Prior research about materiality and sustainability reporting of universitiesFor investigating the aspect of materiality for internal and external stakeholders and itscoverage within universities’ SRs, a structured literature review was conducted using twoonline databases (EBSCOhost and Web of Science). The search period was from 2000 to2019, limited to peer reviewed English journal articles. A title, abstract and keyword searchwas conducted. The literature review resulted in 44 relevant papers which can be clusteredas displayed in Table I.
Outside the university sector (Section A), 18 studies were identified. The idea to makeSRs more stakeholder-relevant is connected to a much earlier discussion on user informationdemands. A common observation of the four identified studies is that information needs ofstrategically relevant external stakeholders are not adequately addressed in SRs.
In total, 14 articles addressed ways of identifying and selecting stakeholder-materialaspects. The complexity and degree of subjectivity of these processes were addressed.These studies also analyse if and to what extent SRs provide a list of material aspects andhow sector-specific these lists are. A central finding in those studies evaluating the results ofthe materiality documentation process was that the listed material aspects are imbalanced,selective and driven by the SR preparers’ interests instead of those of (other) strategicrelevant stakeholders.
In the for-profit sector, two studies performed a materiality analysis: Font et al. (2016)conducted a comparison between corporate sustainability reporting index, developedspecifically for the cruise industry by Bonilla-Priego et al. (2014), and the actual reportingindicators. They used the comparative sustainability reporting indicator as a framework toevaluate to what extent these framework indicators are reported. Also Guix et al. (2018)assessed the disclosure practices of the largest hotel groups worldwide based on theAccountAbility’s AA1000 Standard (AccountAbility, 2019). The stakeholder engagementprocess, the relevance of sustainability issues and organisations’ responsiveness wereanalysed. In this paper we chose a different approach. We examine in GRI G4 reports towhat extent the documented material aspects guide the reporting practices.
Empirical research about SRs prepared by universities is still in an early stage but issignificantly gaining momentum (Ferrero-Ferrero et al., 2017; Ceulemans et al., 2015; Lozanoet al., 2015). For analysing SR of universities, a few normative frameworks exist on how toevaluate the sustainability performance of universities (Larrán et al., 2016; Ceulemans et al.,2015). Among them is the framework by Lozano (2006), the Fonseca Framework (2011), theGRI G4 Framework and frameworks which augment the GRI framework with additionalindicators (e.g. Lopatta and Jaeschke, 2014; Sassen et al., 2014). With the exception of GRI G4Guidelines, all sustainability assessment frameworks for universities were developed for theNorth-American or European context (Larrán et al., 2016).
Four papers deal with sustainability reporting in a global context. In 2015, Ceulemanset al. provided a comprehensive overview of the fragmented research on sustainabilityreporting and identified as a research gap a lack of studies focusing on materiality in SRs ofuniversities. Although, many HEIs engage in various sustainability efforts, there was noholistic concept behind it (Lozano et al., 2015). Alonso-Almeida et al. (2015) analysed thediffusion of SRs (2001–2012) based on GRI in 18 countries worldwide (45 reports) showingthat only few universities were disclosing consecutive reports. These authors criticised the
367
University G4-sustainability
reports
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
Section
Aoutsideuniversity
sector(18articles)
Userinform
ation
demands
(4articles)
Deeganand
Rankin(1997)
Quantita
tive123annu
alreportusersin
Australia
Analysisof
theim
portance
ofenvironm
entalinformationforshareholders’decision-m
aking
processes:shareholders
with
anoversigh
tfunctio
n(e.g.g
overnm
ent)consider
environm
entalissuesas
materialfor
theirdecisions.The
annu
alreportisconsidered
tobe
moreim
portantthan
othersourcesof
environm
entalinformationproviding
O’Dwyeretal.
(2005)
Quantita
tive15
social
and13
environm
entaln
on-
governmentalo
rganisations
(NGOs)in
Ireland
Examinationof
corporation’ssustainabilityreportingin
orderto
fulfilN
GOsinform
ation
needsandto
hold
corporations
accoun
table:NGOsdemandmandatedandexternally
verifiedsustainabilityreporting(in
reportsor
websites)in
orderto
evaluatehowwellu
sers’
inform
ationneedsaremet
orto
exertNGOspressure
oncompanies
DeVilliers
and
Van
Staden
(2010)
Quantita
tive474shareholders
inAustralia,the
UKandthe
US
Analysisof
coun
tryandgend
erdifferencesam
ongshareholders
concerning
environm
ental
inform
ationneeds:themajority
oftheshareholdersrequ
irethedisclosureofspecific,audited
environm
entalinformationforfin
ancial
decisions.Accountability
andredu
ctionof
inform
ationasym
metry
areim
portantfactors
Diouf
andBoiral
(2017)
Qualitative33
stakeholders
andexpertsin
Canada
Analysisof
view
sof
socially
responsibleinvestmentpractitioners
regardingthequ
ality
ofGRIreports:SR
sareun
balanced
concerning
TBLdimensions.GRIreportswerepositiv
ely
evaluatedregardingtherelevance,credibility
andinform
ationqu
ality
.Contin
uous
improvem
entof
sustainabilityreportingisseen
positiv
ely
For-profit
sector
stud
ies(14articles)
Ecclesetal.(2012)
Qualitative6indu
stries
(48
companies)
Proposalo
fan
approach
forthedeterm
inationof
sector-specific
indicators
toenable
comparabilityof
environm
ental,social
andgovernance
indicators:a
greatvariation
concerning
disclosure
inform
ationaboutclim
atechange
was
foun
d.Materiala
spects
for
non-fin
ancial
reportingshould
bedefin
edindu
stry
specific
Hsu
etal.(2013)
Conceptualtechn
ical
company
inTaiwan
Provision
ofasystem
aticmethodology
forprioritisingmaterialinformationin
SRs
Unerm
anand
Zappettini(2014)
Qualitative23
companies
SRs
intheenergy
andmining
sector
Re-exam
inationof
Boiral’s
(2013)
contentanalysis:the
author
foun
dthat
90%
ofthe
negativ
eeventswerenotm
entio
nedinSR
s.The
materialitydeterm
inationprocesshastobe
considered
whileinterpretin
gabsenceof
social/env
ironmentald
isclosures
inSR
sCalabrese
etal.
(2015)
Conceptualretailcom
pany
inItaly
Analysisof
thegapbetw
eenthedisclosed(CSR
)-com
mitm
entinSR
s,thecustom
errequ
ired
andcustom
erperceivedcommitm
entby
aCSR
custom
ermatrix
Jonesetal.(2015a)Qualitative20
UK
housebuildingcompanies
Investigationof
theroleof
external
assuranceandmaterialityas
apartof
themateriality
reportingprocess:almostallcom
panies
provided
inform
ationon
theirsustainability
approach,b
utonly
aminority
embraced
thematerialityprincipleor
provided
independ
ent
external
assurance
(continued)
Table I.Mapping of seminalworks by researchdesign andcontribution/majorfindings
368
JPBAFM31,3
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
Jonesetal.(2015b)Qualitative9UKcommercial
property
companies
Investigationifmaterialaspectswereidentifiedwith
inthesustainabilityreportingprocess:
although
companies
provided
aSR
orinform
ationon
theirsustainability
approach,lessthan
halfprovided
inform
ationon
theidentificationandthecontentof
selected
materialaspects.
Sixcompanies
provided
anindepend
entexternal
assurancestatem
ent
Calabrese
etal.
(2016)
Conceptualw
ater
technology
company
inItaly
Methodbasedon
theGRIG
uidelin
es,for
defin
ingmaterialaspects:tosupp
ortcom
panies
toidentifytheappropriatereportcontent
Fontetal.(2016)
Qualitative/qu
antitative29
cruise
companies,59internal
andexternal
stakeholders
Analysisof
thematchingbetw
eenstakeholderexpectations
andsustainabilityreporting
with
inthecruise
indu
stry
basedon
acorporatesocial
responsibilityindexdevelopedby
Bonilla-Priegoetal.(2014):a
sign
ificant
gapoccurred
betw
eentheaspectsmanagers
classifiedas
materiala
ndtheinform
ationneedsof
otherstakeholders
Jonesetal.(2016a)Qualitative10
UKretailing
companies
Investigationof
theroleof
external
assuranceandmaterialityas
apartof
themateriality
reportingprocess:sixoutof
tenretailers
embraced
materialityin
theirSR
s,four
identified
priorities,bu
tthereweresign
ificant
differencesintheextent
andscarce
evidence
ofasector-
specificapproach
Jonesetal.(2016b)Qualitativefirst
10for-profit
companies
worldwidelistedin
Googlehaving
publishedaG4
SR
Exp
loratio
nof
theadoptio
nof
theG4Guidelin
eswith
incompanies:a
variability
ininform
ationon
theidentificationanddocumentatio
nof
materialaspectscouldbe
observed.
The
reportsfocusedprim
arily
oninform
ationaboutb
usinesscontinuity
andenvironm
ental
issues.E
xternala
ssurance
was
provided
only
inafew
cases
Jonesetal.(2016c)
Qualitativehospita
litysector
Provision
ofpersonalreflections
ontheaspectof
materialityandexternalassuranceof
SRs
with
inthehospita
litysector:aninsufficient
documentatio
nof
materialaspectsandlacking
external
assurancewith
inthehospita
lityindu
stry
canbe
observed
Puroilaetal.(2016)
Qualitative29
publicly
traded
companies
intheGlobal100
indexapplying
G4
Identificationof
four
differentframes
used
insustainabilityreporting,therisk
managem
ent,
thebu
siness
opportun
ity,the
sustainabilitystrategy
andthelegitim
acyfram
e.Materiality
was
mostly
used
tocreate
anidealised
image
Lai
etal.(2017)
Qualitative14
Generali
employees
Analysisof
thedeterm
inationof
materialityin
anIR
contexta
ndaddressees
oftheIR:w
hat
isregarded
asmaterialisdeterm
ined
exclusivelyinternally
underthesupervisionof
the
chieffin
ancial
officer
andthefirm’sstrategy
.Capita
lproviders
arethemainaddressees
Guixetal.(2018)
Qualitative/qu
antitative50
hospita
litygroups
worldwide
Analysisof
stakeholderinclusiveness,materialityandhow
stakeholderconcerns
were
addressedin
SRsby
applying
theAA1000
StakeholderEng
agem
entStandard
(Accountability,2019):the
results
show
ed,thathotelsdisclose
thematerialityanalysis
outcom
es,b
utnottheidentificationof
stakeholderengagement
(continued)
Table I.
369
University G4-sustainability
reports
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
Section
Buniversity
sector(26articles)
Worldwidesurveys
(4articles)
Alonso-Alm
eida
etal.(2015)
Quantita
tive/qu
alita
tiveGRI
database
andGRISR
sWorldwidediffusionof
sustainabilityreporting:
thediffusionof
sustainabilityreportingis
still
atthebeginn
ing
Ceulemansetal.
(2015)
Literature
review
178articles
Articlesconcerning
sustainabilityreporting,
sustainabilityassessmentandenvironm
ental
managem
entwereanalysed:researchaboutsustainabilityreportingin
HEIisfragmented
andtheim
plem
entatio
nof
sustainabilityislagg
ingbehind
othersectors
Lozanoetal.(2015)
Literature
review
60articles
survey
84respondentsfrom
70HEIs
The
categories
background
,institutionalframew
ork,
campu
soperations,edu
catio
n,research,outreachandcollaboratio
n,on-cam
pusexperiences,assessmentandreporting
wereidentified:although
severalinitia
tives
andeffortsconcerning
sustainabledevelopm
ent
areexistin
gworldwide,theim
plem
entatio
nof
sustainabledevelopm
enthasbeen
compartmentalised
Blanco-Portela
etal.(2017)
Literature
review
35articles
Driversandbarriersprom
otingtheprocessofOrganisationalC
hang
eManagem
enttow
ards
sustainability:
thecategories
stakeholder,internal
structure,external
factors,institu
tional
fram
eworkandresourceswereidentified.
Aplethora
ofstud
iesidentifiedstakeholders’
concerns
asthemostrelevant
one
Specialreports
inthe
field
ofun
iversities
(3articles)
Habersam
etal.
(2013)
Qualitativecase
stud
yat
Austrianun
iversities
Usage
ofalegally
requ
ired
non-fin
ancialreportingtool(knowledg
ebalancesheets,K
BS)
bydifferentstakeholder
groups
ofAustrianpu
blicun
iversities:thefin
ding
sshow
edthat
KBSs
play
anim
portantroleforinternal
decision
makingandcontrola
gend
asDelSordoetal.
(2016)
Qualitativecontentanalysis
of12
social
reportsin
Italy
andinterviewswith
their
preparers
Motives
forthedisclosure
ofnotlegallyrequ
ired
socialreportsandtheaccompany
ingmain
difficulties:theanalysed
reportsdidnotprovidein
depthinform
ationon
social
and
environm
entalissues
Habersam
etal.
(2018)
Qualitativelong
itudinalcase
stud
yat
Austrianun
iversities
Usage
ofmandatory
KBSin
Austrianpu
blicun
iversities:theim
plem
entatio
nprocesswas
analysed
from
differentperspectives
(com
mun
icationcultu
re,organisationof
change
processesor
allocatio
nof
resources)
Integration/
implem
entatio
nprocessof
sustainability
reportingin
HEIs
(3articles)
Bruscaetal.(2018)
QualitativeUniversity
ofCadiz
Analysisof
theim
plem
entatio
nof
sustainabilityandintegrated
reportingat
theUniversity
ofCadizby
applying
thefram
eworkof
Secund
oetal.(2016):m
ainlysocial
and
“sustainability”
values
wereaddressed.
The
mostim
portantstakeholdergroupwas
the
university’ssocial
coun
cil
(continued)
Table I.
370
JPBAFM31,3
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
Zorio-Grimaetal.
(2018)
Qualitative49
public
universitiesin
Spain
Identificationof
factorsleadingto
sustainabilityreportingexperience:com
binatio
nsof
innovatio
nprofile,p
oliticala
ndinternal
factorslead
toexperience
insustainability
reporting.
The
implem
entatio
nof
asustainabilitycommittee
andexternal
assuranceof
the
SRaregettingpartsof
universitiessustainabilitystrategies
Yáñez
etal.(2019)
QualitativeEscuela
Tecnica
Superior
deIngenieros
Indu
striales
Analysisof
thesustainabilityreportingprocess(th
reeSR
s)du
ring
aneigh
tyearperiod
ina
Spanishpu
blicengineeringschool
basedon
theGRIGuidelin
es:the
stud
yhigh
lightsthe
transfer
ofsustainabilityvalues
across
theentireorganisatio
nandtheincreasing
participationof
stakeholders
inthedecision-m
akingprocesswith
anaccompany
ing
institu
tionalisationof
theidentificationof
relevant
aspects
Internal
andexternal
stakeholder
expectations
(4articles)
Larránetal.(2012)
Qualitativestakeholder
groups
of10
public
universitiesin
And
alusia
Analysisofdifferentstakeholderexpectations
inAnd
alusianpu
blicun
iversities:43
relevant
stakeholderconcerns
wereidentified.
Com
mon
areaswhere
allstakeholder
groups
wanted
moreinform
ationwere:governance
ofun
iversities,em
ployability,transferabilityof
university
research
tocompanies,allocatio
nof
resources
Mainardes
etal.
(2012)
Qualitative/qu
antitative1,669
stud
ents’expectations
at11
publicun
iversitiesinPortugal
Analysisof
stud
ents’expectations
ofpu
blicun
iversitiesin
Portugal:themostim
portant
expectations
were:un
iversity
quality
standardsforthedegrees,im
provem
entofp
artnership
betw
eenstud
ents
andun
iversity,employability,p
ersonalfulfilmentandaboutthecurrent
environm
entalconditio
nsin
university
Larránetal.(2016)
Qualitativesenior
managem
entmem
bers
of8
publicun
iversitiesin
And
alusia
Identificationof
stakeholderexpectations
forthedevelopm
entof
asustainability
assessmentandreportingtool
inHEIs:155
materiala
spects
wereclusteredin
seven
dimensions.The
high
estrelevance
show
edthecorporategovernance
andenvironm
ent.The
leastrelevant
dimensionswereindicators
oncompanies
andcontinuous
improvem
ent
Ferrero-Ferrero
etal.(2017)
Qualitative/qu
antitative10
SRsof
universities(2014)
and
acase
stud
yin
aSp
anish
publicun
iversity
AnalysisofstakeholderengagementinHEIsinthecontextofthe
adoptio
nofthemateriality
principlein
GRISR
sanddifferencesin
expectations
ofthesestakeholdergroups:a
high
compliancerate
betw
eentheexpectations
ofinternal
stakeholders
andthedocumented
materiala
spects
couldbe
foun
din
thesing
le-casestud
y.Differencesexistedbetw
eenthe
expectations
ofinternal
stakeholdergroups
across
the10
universities
Framew
ork
Lozano(2006)
Conceptual
Developmentof
theGraph
ical
Assessm
entof
Sustainabilityin
Universities
(GASU
)fram
ework:
theGRIGuidelin
eswereaugm
entedby
aneducationald
imension
Total
coverage
rates
(TCR)o
rcoverage
ratesof
performance
Fonseca
etal.
(2011)
Conceptual/q
ualitative7
Canadianun
iversities
(2006–2008)
Developmentof
afram
ework(based
onG3andCam
pusSu
stainabilityAssessm
ent
Framew
ork,
CSA
F)for
analysingSR
spu
blishedby
Canadianun
iversities:less
than
30%
publishedSR
s.Based
ontencategories
and56
indicators
anaveragetotalcoveragerateof
(continued)
Table I.
371
University G4-sustainability
reports
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
dimensions
(11articles)
36%
was
identified(economic:19%
,env
ironmental:63%,social:21%,u
niversity
:25%
).Fouroutof
sevenun
iversitiesreported
onstakeholderengagement
Lozano(2011)
Qualitativetw
elve
universitiesworldwide
(2002–2009)b
ytheGASU
Framew
ork(Lozano,2006)
Analysisof
universitiesSR
performance
(followingtheGRIGuidelin
es)w
orldwideby
applying
GASU
:12un
iversitiesworldwideprovided
aSR
covering
TBLindicators.T
heappliedGASU
fram
eworkconsistof
126indicators.T
heresults
indicate
acentralfocus
ontheeconom
ic(coverageof
11%)a
ndtheenvironm
entald
imension
(coverageof
17%).
Concerningthesocialdimension
acoverage
of7%
andon
theeducationald
imension,one
of6%
was
foun
dLopatta
and
Jaeschke
(2014)
Conceptual/q
ualitative6
German
andAustrian
universities(until2011)
Developmentof
afram
eworkbasedon
theGRIGuidelin
es(G3)
andsupp
lementedby
aneducationald
imension
toassess
SRsin
GermanyandAustria:4%
oftheun
iversities
publishedaSR
.The
fram
eworkhas87
indicators.T
hehigh
estcoverage
ratescouldbe
foun
don
theenvironm
ental(29%)and
ontheeducationald
imension
(30%
),followed
bythe
econom
icdimension
(25%
)and
thesocial
one(14%
),adding
upto
aTCR
of26%
Sassen
etal.(2014)
Conceptual/q
ualitative14
German
universities(24
reports)regardless
their
appliedstandards
(2004–2014)
Developmentof
afram
eworkbasedon
theGRIGuidelin
esaugm
entedby
aneducational
dimension
toassess
24SR
sin
Germany:
thefram
eworkhas130
indicators.4%
ofthe
universitiespu
blishedaSR
.65outof
130indicators
werereported.T
hehigh
estcoverage
rate
show
edtheeconom
icdimension
(40%
),followed
bytheenvironm
ental(31%),the
university
(27%
)and
finally
thesocial
(11%
)Hinsonetal.(2015)
Qualitative6Hinsonetal.
(2015)
basedon
G3and
Fonseca’sfram
ework
(Fonseca
etal.,2011)
App
licationof
Fonseca’sfram
ework(Fonseca
etal.,2011),basedon
theGRIG
uidelin
esand
campu
ssustainabilityassessmenttools,to
analysethestateof
sustainabilityreporting:
anaveragecoverage
rate
of57%
was
foun
d.Allsixun
iversitiespu
blishedaSR
.Stakeholder
engagementplaysan
importantrole(fouroutof
sixun
iversitiesreporton
thisindicator).
Economic(financial)ind
icators,social
performance
aswella
sresearch/curriculum
and
teaching
wereequally
wellcovered.T
heenvironm
entald
imension
played
aminor
role
Rom
olinietal.
(2015)
Qualitative20
universities
worldwide(2012)
byanalysingG3.1
Analysisof
thematurity
levelofsustainabilityreportingin
HEIb
yevaluatin
g20
GRIS
Rs.
65%
oftheanalysed
universitiescomefrom
Europe.A
coverage
rate
of64%
forthe
econom
icdimension,49%
fortheenvironm
entala
nd53%
forthesocial
dimension
was
detected
BiceandCoates
(2016)
Qualitative10
Eng
lish
lang
uage
reportsworldwide
(2007–2014)b
ased
onG3
Analysisofselectivesustainabilityperformance
measures,basedmainlyon
GRI,concerning
theirapplicability
formeasuring
universitiessustainabilitycontribu
tionto
society:
all
university
reportsdisclosedtw
oor
moreeconom
icindicators,clim
atechange
was
atopicin
(continued)
Table I.
372
JPBAFM31,3
Topic
Author(s)/year
Researchdesign
respondents/
sector
Contribution/major
finding
s
(threeun
iversities)or
G3.1
(7un
iversities)
50%
oftheanalysed
reports,andbiodiversity
was
identifiedas
anim
portantarea.A
llun
iversitiesprovided
inform
ationon
stakeholders.T
woreportshadan
external
assurance
Dagilienėand
Myk
olaitienė
(2016)
Qualitative40
Lith
uanian
tertiary
sector
institu
tions
(2013–2014),am
ongthem
11un
iversities
Analysisof
inform
ationdisclosure
inthehigh
ereducationsector:p
erform
ance
indicators
relatedto
indirect
econom
icim
pactsandmarketpresence,env
ironmentalexp
enditure
aswella
senergy
andbiodiversity,ong
oing
campaigns
oreffortsin
makingaun
iversity’s
environm
entfriendlierfordisabled
stud
entswereidentifiedas
wellcovered
areasintheSR
sLarránetal.(2018)
Qualitative58
universities
worldwide(138
SRs)
followingG3,G3.1or
G4
Analysisof
thecoverage
ratesof
SRsfrom
theGRIdatabase
inorderto
exam
inethe
influ
ence
ofcertainvariablesin
relatio
nto
thedisclosure
ofsustainabilityinform
ation:
the
analyses
show
edaTCRof
44%.T
heeconom
icdimension
performed
thebest
with
acoverage
rateof54%,followed
bythesocialdimension
with
44%
andtheenvironm
entalone
with
41%.Institutionalisation,
geograph
ical
region
andexternal
assurancehave
been
the
mostinflu
entia
lvariables
Sassen
andAzizi
(2018a)
Qualitative20
Canadian
publicandprivate
universitiesregardless
their
appliedstandards
(2011–2015)
Assessm
entof2
0SR
sby
applying
afram
eworkbasedon
theGRIG
uidelin
esaugm
entedby
aneducationald
imension
(Sassenetal.,2014):13%
publishedaSR
.The
high
estcoverage
show
edtheenvironm
entald
imension
(15%
)and
theun
iversity
dimension
(13%
),thelowest
onetheeconom
ic(4%)a
ndthesocial
dimension
(1%).Noreportdisplayedexternal
assurance
Sassen
andAzizi
(2018b)
Qualitative23
USun
iversities
participatingin
the
SustainabilityTracking,
Assessm
entandRating
System
(AASH
E)(2019)
Assessm
entof2
3SR
sby
applying
afram
eworkbasedon
theGRIG
uidelin
esaugm
entedby
aneducationald
imension
(Sassenetal.,2014):7%
oftheUSun
iversitiespu
blisheda
comprehensive
SR.T
heauthorsdiscovered
areportinglevelo
f30%
with
inthe
environm
ental,21%
with
intheeducational,11%
with
intheeconom
icand7%
with
inthe
social
dimension
Table I.
373
University G4-sustainability
reports
low diffusion rates and stressed the importance of sustainability reporting for stakeholdersfor comparing the sustainability development activities among different universities.Regarding organisational change management for sustainability, Blanco-Portela et al. (2017)identified drivers and barriers for the integration of sustainability.
Three studies focus on special aspects of performance assessment of universities:Del Sordo et al. (2016) analysed the content of social reports as a voluntary practice inItalian universities. Habersam et al. (2018, 2013) analysed with a qualitative casestudy approach the interpretation and use of mandatory knowledge balance sheets ofAustrian universities.
Three single-case studies analysed the implementation process concerning sustainabilityreporting in HEIs. Only one single-case study (Yáñez et al., 2019) emphasised theoutstanding role of the SR. In this single-case study, the SR contributed to the developmentof a holistic stakeholder accountability and a standardisation of the materiality process.
Four papers studied the issue of what stakeholder regard as material. OnlyFerrero-Ferrero et al. (2017) sought to determine if the selected material aspects ofinternal stakeholders also were documented in SRs in the case of one Spanish university. Allfour studies showed the heterogeneity and extensiveness of stakeholder concerns.
In total, 11 studies evaluated the coverage rates of triple bottom line performanceindicators; 3 studies additionally reported the total coverage rates (TCRs). With theexception of the Ghanesian case (Hinson et al., 2015 found an average coverage rate of57 per cent), the TCRs and the coverage rates of selected performance indicators weredisappointing (on the average below 50 per cent).
This brief overview shows that inside and outside the university sector, no study existswhich evaluated if the in GRI G4-19 documented material aspects guide the reportedcontent. Prior studies of coverage rates merely focused on quantitative guidelinecompliances, operationalised by the amount of indicators reported. In the university sector,only Ferrero-Ferrero et al. (2017) performed a quantitative content analysis of ten SRsworldwide for identifying material aspects, as addressed in RQ1. This paper extendsthis search to the 33 universities worldwide, which appeared in the GRI database. WhileFerrero-Ferrero et al. (2017) used the GRI G4-Framework modified by Lozano (2006) toanalyse which stakeholders are involved and how they are involved for determiningmaterial aspects, the current study is based on an inductive identification of materialaspects. Furthermore, the current study is the first to examine the internal consistencybetween the listed material aspects and their coverage in the SRs.
3. Theoretical consideration on materiality disclosures by universitiesWhile theoretical reflections on general motives, implementation levels in and across countriesand factors driving the implementation of SRs are well advanced (Shabana et al., 2017),stakeholder materiality is still under-researched (Ferrero-Ferrero et al., 2017). Strategicstakeholder theory and sociological institutionalism are used here for formulatingcontradictory expectations about the extent in which SRs comply with themateriality principle.
Strategic stakeholder theoryStakeholder theory, popularised by Freeman (1984), considers the relationship between anorganisation and its stakeholders (Harrison, 2013; Freeman, 2010, 1984). According toFreeman (2010), it is essential to clearly identify stakeholders and their perceived stakes.Additionally, it is relevant to manage an organisation’s relationship with its stakeholders andto understand the set of transactions or bargains among an organisation and its stakeholders.An essential claim within the strategic stakeholder theory is that stakeholder expectations aremulti-fold, heterogeneous and conflicting. Therefore, trade-offs have to be made to balancethese conflicting stakeholder demands (Chen and Roberts, 2010; Freeman, 1984).
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Strategic stakeholder theory claims that a cooperative and trustworthy relationship withrelevant stakeholders is regarded as a critical part for a firm’s ongoing success and forsecuring a continuous flow of resources (Freeman et al., 2004). Strategic stakeholder theorystresses the instrumental value of good stakeholder relations. Satisfying needs anddemands of salient stakeholders is seen as a win-win situation which unlocks an additionalpotential for value creation (Harrison et al., 2010; Freeman et al., 2004). The managementchoices of how well it satisfies its most important stakeholders are essential for the survivalof an organisation (Rowley, 1997).
Not all stakeholders have the same relevance. For classifying stakeholders, Mitchell et al.(1997) introduced to the debate three criteria, namely, legitimacy, power and urgency.Depending whether one, two or three criteria are fulfilled, stakeholders can be classified intothree groups, i.e. latent, expecting and definite stakeholders. With respect to salience,defined as “the degree to which managers give priority to competing stakeholder claims”(Mitchell et al., 1997, p. 869) it is important to pay attention to the claims of definitestakeholders, the dominant and the dangerous stakeholders. On the other stakeholdergroups, a watchful eye should be kept if their status changes because they acquire anothersource of stakeholder influence (power, legitimacy or urgency).
Identifying for an organisational survival medium or highly salient stakeholders andproviding them with relevant information is a crucial part of a strategic stakeholdermanagement. For universities, the United Nations Global Compact stresses that inuniversities a shift “from short-term corporate visions to a broader, multi-stakeholder focus”is necessary (UNGC, 2012, p. 8). For universities, SRs are regarded as a managerialinstrument for gaining social acceptance and support of strategically relevant stakeholders(Ntim et al., 2017). Under resource-providing aspects, the pressures on universities to servethe information needs to salient stakeholders have increased considerably in the universitysector. The hybridisation of the funding sources and the increase of stakeholderaccountability pressures have led in the university sector to a development that the numberof stakeholders which hold universities accountable has increased considerably in thepast decades.
To know what the most important stakeholders regard as material and to serve theseinterests is of instrumental value for universities. Therefore, based on the reasoning ofstrategic stakeholder theory, it can be argued that university SRs should show a highcompliance between the SRs documented material aspects of under resource-providingaspects relevant stakeholders. The reported content should be in line with the informationneeds of the medium or highly salient stakeholders.
Sociological institutionalismSociological institutionalism provides a more sceptical position regarding the compliancewith the materiality principle. Sociological institutionalism focuses on the shaping effects ofsocial pressures for stability, legitimacy and survival reasons (Higgins and Larrinaga, 2014;Chen and Roberts, 2010). Organisational behaviour is triggered by coercive, normative andmimetic isomorphism (Higgins and Larrinaga, 2014; DiMaggio and Powell, 1991).For DiMaggio and Powell (1991, p. 67) coercive isomorphism results “both from formaland informal pressures exerted on organisations by other organisations upon which theyare dependent on and by cultural expectations”. Coercive isomorphism is based onpower relationships and politics and therefore results from regulations by the state andother powerful actors with sanctioning powers. GRI does not have these powers.Furthermore, publishing a SR is, with the exception of the Spanish province of Andalusia, inno country obligatory for universities. Normative isomorphism primarily stems fromprofessionalisation (DiMaggio and Powell, 1991) and demands conformity with professionalstandards by professional networks, credential and educational institutions (Heugens and
375
University G4-sustainability
reports
Lander, 2009). GRI is such a normative pressure. Compared to other voluntaryaccountability clubs (i.e. accreditations and certifications) for universities, GRI is a weakone due to missing entrance requirements, lack of peer visits and a lack of sanctioningpowers. Mimetic isomorphism arises from uncertainty and high implementation rates in thechosen field. As a low-cost coping strategy, organisations imitate peer organisations, whichthey perceive as successful (Heugens and Lander, 2009; Boxenbaum and Jonsson, 2008;DiMaggio and Powell, 1991). The literature review has shown that so far the implementationrates of sustainability reporting are far behind those of stock exchange listed companies.
Another central claim of sociological institutionalism is that organisations adopt newpractices in a symbolic way leading to a ceremonial compliance or decoupling (Heugens andLander, 2009; Boxenbaum and Jonsson, 2008; Meyer and Rowan, 1991). Organisations abideonly superficially to institutional pressures (Boxenbaum and Jonsson, 2008). Heterogeneousor harmful stakeholder demands are among the reasons for decoupling (Cho et al., 2015).
Scholars investigating institutionalisation processes of sustainability reporting practicesargue that a full institutionalisation takes considerable time. For a full institutionalisation,Shabana et al. (2017) state that the reporting practice must have reached a critical mass.Bebbington et al. (2009) suggest that coercive and normative isomorphism are influencingmore the activity than the content of SRs. As materiality is a fairly new practice for SRs, afull institutionalisation cannot be expected. The challenges already start with selectingstakeholder-material aspects. Identifying, selecting and prioritising stakeholder-materialaspects is a challenge which is potentially leading to a low alignment. Universities areinstitutions which have to serve multiple stakeholders. In the past decades, the number ofmedium or highly salient stakeholders has increased considerably in the university sector.Traditionally, public-funded universities relied mostly on government’s money. Today,students’ fees, competitive research grants from various providers or industry money arealso relevant income sources. Stakeholder plurality makes a stakeholder prioritisation notan easy task. Unerman and Zappettini (2014) argue that any definition of materiality, wheremeanings are constructed by external stakeholders and within an organisation, presents acontested area which gives room to a variety of interpretations. As the literature review hasshown (Ferrero-Ferrero et al., 2017; Larrán et al., 2012, 2016; Mainardes et al., 2012),stakeholder information preferences are plentiful and heterogeneous in the universitysector. Universities as stakeholder-pluralistic organisations with broad missions areconfronted with rather heterogeneous stakeholder information demands where a lot oftrade-offs have to be made to deal with this. An additional challenge is that the willingnessof powerful resource providers of universities (i.e. governments, research funding agenciesand accreditation agencies) to engage themselves in a meaningful stakeholder engagementprocess is most likely low as they have the power to impose or negotiate more to theirinformation needs tailored accountability requirements.
Based on sociological institutionalism, two gaps are likely which result in a lowcompliance with the materiality principle. The first gap consists of shortcomings in theidentification and listing of material aspects in the SRs, as required by the GRI G4Guidelines. The in GRI G4-19 displayed list is not in line with the preferences of salientstakeholders. A second gap can occur if SR preparers do not take materiality as acontent-selection principle seriously, resulting in the situation of a low internal consistency.In this situation, the content of the SR is not focused on the documented material aspects.
4. Sample description and methodologyThe assessment of SRs is based on GRI G4 Guidelines. All the newest GRI G4-SRs ofuniversities uploaded to the GRI database up to 30 April 2018 are included irrespective ofthe publication’s language ( full census). In total, 33 reports could be included into the studyfor evaluating the implementation of the materiality principle of GRI SRs globally. The low
376
JPBAFM31,3
number of available reports presents a limitation we share with other studies empiricallyanalysing the state of the art of sustainability reporting universities, as shown in theliterature review. Compared to prior studies, this is the first study which provides aninternational comparison of sustainability reporting at universities under the focus ofmateriality. A list of all 33 universities is provided in Table II.
Regarding the geography of the analysed universities, they are distributed in thefollowing way, two from North America, eight from Europe, eight from Asia and two fromAustralia. In all, 20 are private (with 8 of the 20 in private, non-profit ownership) and 13are public. Enrolments vary with 42 per cent under 15,000 students, 49 per cent between15,001 and 55,000 students, and 9 per cent with over 55,000 students. In total, 36 per centwere ranked by one of the major ranking institutions (Times Higher Education, QS WorldUniversity Ranking or Academic Ranking of World Universities). Due to the importancefor sustainability reporting, membership to the Higher Education Sustainability Initiative(HESI), which is a partnership of universities with UN Organisations created in 2012, wasexamined. Seven universities have a HESI membership. To analyse the influence of thesecharacteristics in regard of coverage rates of the identified material dimensions, t-tests at a
Country UniversitySize (numbers of
students)Public/private
HESImembership
Australia Deakin University 34,968 Public ×
Australia University of Melbourne 42,273 Public ×
Belgium Ghent University 41,000 Public ×
Brazil Instituto Superior de Administraceo eEconomica (ISAE)
6,173 Private ×
Brazil Anhanguera Educacional 441,900 Private ×
Brazil Universidad Feevale 19,000 Private ×
Brazil Estació 334,200 Private ×
Chile Pontificia Universidad Católica de Valparaiso 15,241 Private ×
Chile Universidad de Santiago de Chile 22,720 Public |
Chile Ponificia Universidad Católica de Chile 26,188 Private ×
Columbia Fundación Universitaria del Área Andina 4,900 Private |
Columbia Universidad Cooperativa de Columbia 55,187 Private |
Columbia Red Ilumno 47,000 Private ×
France INSEAD – The Business School for the World 1.399 Private ×
Italy Università degli Studi di Torino 67,043 Public ×
Mexico University de Monterrey (UDEM) 13,062 Private ×
Peru Universidad del Pacifico 5,460 Private |
Peru Universidad San Ingnanco de Loya 6,581 Private ×
Philippines University of Asia and the Pacific 2,129 Private |
Philippines Ateneo de Manila University 10,333 Private ×
Portugal Universidade do Minho 18,475 Public ×
South Korea Wonkwang University 25,189 Private ×
Spain ESADE Business School 11,037 Private |
Spain Escuela técnica superior de ingenierosindustrials de la UPM
4,431 Public ×
Switzerland ETH Zürich 19,233 Public ×
Taiwan Nanhua University 5,200 Private ×
Taiwan Hungkuang University 13,107 Private ×
Taiwan Ming Chi University of Technology 4,039 Private ×
Taiwan National University of Tainan 31,591 Public ×
UK Plymouth University 19,772 Public |
USA Ball State University 21,988 Public ×
USA University of California, Berkley 38,204 Public ×
Table II.List of the 33
analysed universities
377
University G4-sustainability
reports
significance level of 0.05 were carried out. These tests show if there is a difference withinthe coverage rates due to the characteristics such as size, ownership, ranking or havingHESI membership.
The methodology used in the empirical part includes two different content analyses(a qualitative and a quantitative one), followed by a correlation analysis. For ensuring thereliability of the content analyses, which “is a technique for gathering data that uses a set ofprocedures to make valid interferences from text” (Guthrie and Abeysekera, 2006: 120), thesuggestions by Guthrie and Abeysekera (2006) based on Milner and Adler (1999) werefollowed. In an iterative process, coding categories and clear decision rules were established.Coding was done independently by two persons. Discrepancies were discussed andreconciled. Content analyses are limited to analysing the documented aspects and thereforeallow only an insight on the explicitly stated aspects.
A qualitative content analysis was completed to address RQ1 about the documentedmaterial aspects. GRI G4-17 to G4-22 indicators address the aspects of materiality.In particular, G4-19 demands that all material aspects that were identified as the outcome ofa stakeholder engagement process for defining a report’s content (G4-18) are listed andranked according to relevance (G4-19 to G4-22) for two stakeholder groups (internal andexternal ones). All 33 universities provided information on material aspects, either in avisual form of a materiality matrix (16 universities) or in a narrative form (17 universities).
The qualitative content analysis on material aspects was done in three steps. First, theinformation on material aspects was listed for each university. In this step of the qualitativecontent analysis process, all material aspects of the analysed universities were identified byreading and analysing the material matrices and the provided text elements of the GRIG4-materiality indicators. Second, the list of material aspects identified in the first step ofour qualitative content analysis was summarised by content leading to four materialsubcategories (economic, environmental, social and education/research) and then dividedinto 15 material dimensions. Third, the information on the relevance levels of alldocumented material subcategories for internal and external stakeholders was collected.As internal stakeholders were mentioned in the analysed SRs: president or rector(ate),university board, university assembly/senate, academic staff, technical and administrativestaff, students and alumni. Identified external stakeholders are parents of students,government bodies, business partners, public decision makers/politicians, media and thepublic. For the analysis, four relevance levels were used (0¼ not mentioned, 1¼ lowrelevance, 2¼middle relevance and 3¼ high relevance). The G4-19 only has three relevancelevels (low, middle and high). The category “not mentioned” was added to indicatehow many universities did not include a specific material dimension in their SRs. If auniversity had a materiality matrix, the information could be taken directly from it as theyprovide information on the three G4 relevance levels (low, medium or high). If the SR of auniversity did not provide a materiality matrix, an evaluation grid was compiled accordingto the importance/extensiveness of a mentioned material dimension and if projects werelinked to it.
The GRI indicators were used as follows: G4-EC1-EC9 for the material dimension ofeconomic performance, G4-EN1-10 for the material dimension resources, the G4-EN22-26 forwaste and recycling, the G4-EN15-21 for emission and G4-EN11-14 for the materialdimension of biodiversity. G4-LA1-3 indicators were used for the material dimensionof employment and diversity, HR1-12 for the material dimension of human rights andG4-SO1-11 for the material dimension of society. G4-PR1-9 was used for the materialdimension of product responsibility.
For each material subcategory and dimension, a coverage rate was calculated as follows.For example, the material subcategory employment/diversity has three indicators. Ifuniversity one reports two of these three indicators the compliance level is 66.67 per cent (2/3).
378
JPBAFM31,3
These compliance levels were divided into four categories (0¼ no coverage, 1¼ low coverage,2¼middle coverage and 3¼ high coverage). The classification of the compliance levelsis the following: no coverage¼ 0,W0–33.33 per cent¼ 1,W33.33–66.66 per cent¼ 2andW66.66 per cent¼ 3. t-Tests at a significance level of 0.05 were carried out to analyse ifthe sample characteristics had an influence on the coverage rates.
A quantitative content analysis was performed to address RQ2. Here, the coverage ratesfor material subcategories and dimensions were calculated based on GRI G4 Guidelines.The coverage was rated on four levels: no, low, middle and high coverage. The relevantindicators for each identified material dimension were aggregated. The aggregation processof the quantitative process was necessary because the documented material dimensions( for RQ1) are also based on the aggregation of dimension-specific indicators. Otherwise, acomparison on the same level would not have been possible. To guarantee the reliability ofthe process of aggregating the G4 indicators for the certain material dimensions, the codingprocess was done by two independent coders. The level of intercode reliability for theaggregate coverage levels is at 0.9.
Finally, a correlation analysis between the relevance of a material dimension and itscoverage in the SRs was conducted to address RQ2, which deals with the research gap if theanalysed universities consider the relevance of a material dimension in their SRs. It wasdone to evaluate if the stakeholder-material aspects were reported in the analysed G4-SRs.To test the correlation hypotheses for each identified material dimension, the followingstructure was formulated:
H0. There is no correlation between the two groups. The evaluation of stakeholders onthe relevance of the material dimension X has no relation to the coverage of thereported indicators of this dimension.
H1. There is a correlation between the two groups. The evaluation of stakeholders on therelevance of the material dimension X has a relation to the coverage of the reportedindicators of this dimension.
To interpret the results of these correlations, the Spearman correlation coefficient was used.If the p-value is under the significance level of 0.05, the null hypothesis is rejectedand a correlation between the two groups exists. A positive correlation means that theextension of reporting on the specific material dimension in the SRs is aligned with therespective relevance level (no relevance, low, medium, high) assigned to the materialdimension by the group of either internal stakeholders or external stakeholders. Forexample, if a specific material dimension is highly relevant, the coverage in the SRs is alsohigh. If there is a negative correlation or no correlation, the documented material dimensionis not reported accordingly.
5. Findings
Material subcategories and dimensionsFrom the qualitative analysis, four material subcategories and 15 material dimensions wereinductively identified (1. “economic”: economic performance; 2. “environmental”: resources,waste/recycling, emission, biodiversity; 3. “social”: employment/diversity, human rights,society, product responsibility; 4. “education/research”: campus life, student mobility, teaching,research, student diversity and student engagement). While “economic”, “environmental” and“social” are subcategories of the G4 Guidelines, the material subcategory “education/research”is an additional field-specific subcategory outside the GRI G4 Guidelines which emerged in themateriality matrix. The dimension of “education/research” is defined as follows: campus lifefocuses on the infrastructure and campus services while student mobility concentrates ongoing abroad programmes and international scholarships. Teaching focuses on all aspects
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concerning study programmes, degrees and curricula while research deals with the researchactivities of a university. Finally, student diversity addresses the structure of the studentpopulation and the integration of students of different gender, nationalities and religions whilestudents’ engagement focuses on the relationship and interactions between students and theuniversity. All the material dimensions in the subcategory “education/research” are not part ofthe GRI G4 material categories and indicators. That they emerged in the analysis is notsurprising, because teaching a research belongs to the core mission of universities.
All SRs include information on what aspects are material for the stakeholders. Therefore,the SRs comply (in a varying degree) with the G4-19 to G4-22 requirements. Thedocumentation of the material aspects is more transparent in those 16 universities whichinclude a materiality matrix in their SR. In the other 17 universities, which do not have amatrix in their reports, the narrative formmakes it more ambiguous andmuch less structured.
The following figures provide an overview of the reported material subcategories andtheir material dimensions grouped according to the location of the stakeholder group (beingeither internal or external). The figures also show the levels of relevance. Figure 1 displaysthe results for the subcategory “economic”. Approximately 76 per cent (25/33) of alluniversities rate economic as a material subcategory and half of all universities see theeconomic performance as a highly relevant dimension (Figure 2).
Internal External Internal External Internal External Internal External
Employment/diversity Human rights Society Product responsibility
No evaluation 5 5 10 10 9 9 12 12
Low 1 6 1 8 3 4 1 6
Middle 6 8 3 3 5 6 4 4
High 21 14 19 12 16 14 16 11
5 5
10 109 9
12 12
16
1
8
3 4 16
6 8 3 3 5 6 4 4
21
14
19
12
1614
16
11
0
5
10
15
20
25Material Subcategory: Social
Figure 2.Frequency of thematerial subcategory– social
Internal External
Economic performance
No evaluation 8 8
Low 1 4
Middle 8 7
High 16 14
8 8
1 4
87
16
14
0
2
4
6
8
10
12
14
16
18
Material Subcategory: Economic
Figure 1.Frequency of thematerial subcategory– economic
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The material subcategory “social” is the second most mentioned category (see Table II).In total, 73 per cent (24/33) of all universities regard one of the four dimensions as material.The material dimension “employment/diversity” is the most highly rated one across allmaterial dimensions with 85 per cent (28/33).
Figure 3 describes the material subcategory “environmental”, subdivided in fourmaterial dimensions. Waste/recycling is the most frequently mentioned material dimensionand evaluated with the highest relevance.
Figure 4 displays frequencies of the material subcategory “education/research” with itssix material dimensions. This material subcategory is not specified in the G4 Guidelines.Within this material subcategory, “teaching” is the most frequently mentioned materialdimension. In total, 50 per cent of the analysed universities ranked this material dimensionas highly important.
If identified as material, the material subcategories and material dimensions reachsimilar high relevance marks, albeit there is a slightly higher relevance evaluation byinternal stakeholders than by the external ones. Summing up, the social materialsubcategory shows a high relevance (based on a weighted average) of 47 per cent (123/264),the economic 46 per cent (30/66), the environmental 27 per cent (71/264) and the education/research 20 per cent (80/396).
In addition, differences in the material subcategories andmaterial dimensions appear whenlooking at the number of universities that do not include them. The “economic” and “social”subcategories appear more frequently than the “environmental” and “education/research”subcategories. The dimensions of emission and biodiversity show a particularly low relevance
Internal External Internal External Internal External Internal External Internal External Internal External
Campus life Student mobility Teaching Research Student diversity Student engagement
No evaluation 28 28 26 26 12 12 18 18 30 30 29 29
Low 0 1 0 1 0 2 0 1 0 0 0 2
Middle 1 1 1 4 0 7 3 3 1 2 0 0
High 4 3 6 2 21 12 12 11 2 1 4 2
28 2826 26
12 12
18 18
30 30 29 29
0 1 0 1 0 2 0 1 0 0 0 21 1 1 4 0 7 3 3 1 2 0 04 3 6 2
21
12 12 11
2 1 4 20
5
10
15
20
25
30
35
Material Subcategory: Education/Research
Figure 4.Frequency of the
material subcategory– education/research
Internal External Internal External Internal External Internal External
Resources Waste/recyling Emission Biodiversity
No evaluation 16 16 13 13 21 21 27 27
Low 0 3 1 2 1 0 3 1
Middle 5 4 6 4 3 4 0 2
High 12 10 13 14 8 8 3 3
16 1613 13
21 21
27 27
0 3 1 2 1 0 3 15 4 6 4 3 4 0 2
1210
13 14
8 83 3
0
5
10
15
20
25
30
Material Subcategory: Environment
Figure 3.Frequency of the
material subcategory– environmental
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within the “environmental” subcategory. Four material dimensions of the materialsubcategory “education/research” are also low performers. The material dimension ofstudent mobility is 21 per cent (7/33), the material dimension campus life 15 per cent (5/33),student engagement 12 per cent (4/33) and student diversity 9 per cent (3/33). On average72 per cent (143/198) of universities do not include any of the material dimensions of thematerial subcategory “education/research”.
Quantitative content and correlation analysisTop coverage rates in the SRs achieve the dimensions of resources, employment/diversity,human rights and economic performance. The material dimensions with the lowestcoverage rates are biodiversity and product responsibility (see Table III).
A t-test of the sample was calculated for the factors size (small:M (47.31, SD 31.98) large:M (43.55, SD 29.09), t(31)¼ 0.354, p¼ 0.726), ownership (public: M (43.85, SD 29.73) private:M (47.73, SD 31.74), t(31)¼−0,357, p¼ 0.723) ranking (no: M (45.05, SD 28.81) yes: M(45.94, SD 33.56), t(31)¼−0.080, p¼ 0.936) and the membership of HESI (no: M 42.50, SD26.50) yes:M (56.07, SD 41.7), t(31)¼−1.601, p¼ 0.297). Except for the membership of HESI,no statistical significance of these factors on the TCRs of the SRs was found. HESI membershave a higher coverage rate.
The mere quantitative coverage rates do not allow an assessment if the documentedrelevance levels of the material dimensions are matched with the appropriate levels of SRcoverages. The correlation analyses for the material dimensions proved to be onlysignificant for the case of biodiversity (at a significance level of 0.05). For both stakeholdergroups, the null hypothesis was rejected. The evaluation of internal stakeholders on therelevance of the material dimension has an influence on the coverage in the SRs. For internalstakeholders, the correlation coefficient is 0.375. It is a middle positive correlation: if theevaluation of internal stakeholders on the relevance of biodiversity is high, the coveragerates of the indicators of biodiversity are also high. The correlation of the coverage rate ofbiodiversity and the relevance for external stakeholders is 0.368. That is also a middlepositive correlation. The correlation analyses of all other material dimensions were notstatistically significant. In 14 of 15 dimensions, there is no correlation between the identifiedmaterial aspects and their coverage in the reports.
6. Discussion and conclusionsAlthough the GRI is one of the most important and used frameworks in the field ofsustainability, reporting our analysis includes only 33 GRI G4 reports of universitiesworldwide. For comparing the implementation rates globally in a structured way,international guidelines such as GRI are necessary. The small sample size is something thisstudy shares with other guidelines or framework-based content analysis of SRs. However,an additional search of SRs of universities worldwide shows that a growing number ofuniversities, that are not included in our analysis, publish SRs or include information onsustainability issues in their reports. This fact shows that SRs of universities are compiledindividually and the attempts to standardise them by adapting frameworks such as the GRIG4 are low. In the past few years, the overall importance of sustainability reporting atuniversities is increasing but is not yet a widely institutionalised practice within this sector.
Identifying material aspects and ranking them was done by all universities listed in the GRIG4 database, albeit with differences in the communication quality. Less than 50 per cent provideda materiality matrix which is, due to its visual form, more user friendly. The transparency onwhat is regarded as stakeholder-material aspects was lower in the 17 universities which relied ona narrative presentation. This leads to the conclusion that transparency of the documentation ofstakeholder-material aspects leaves room for improvement. This is a finding shared with results
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Coveragerates
Economic
Resources
Waste/recyclin
gEmission
Biodiversity
Labour
employment/diversity
Env
ironmentHum
anrigh
tsSociety
Produ
ctresponsibility
Nocoverage
30
011
177
14
74
0.01–33.33%
137
174
166
179
1515
33.33–66.66%
814
99
21
79
48
Over66.67%
912
79
819
811
76
Table III.Coverage rates
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in other sectors, displayed in the literature review (Lai et al., 2017; Calabrese et al., 2016; Font et al.,2016; Jones et al., 2016a, b, c, 2015a, b).
RQ1, which focuses on the documented material aspects, showed marked differencesamong the inclusion rates of the four subcategories. In the G4-19 documentations, thematerial subcategories “economic” and “social” achieve a much higher level of interest fromboth stakeholder groups than the other two material subcategories (“environmental” and“education/research”). This finding is a problematic sign, if one compares it with thetraditional core missions of universities, namely, education and research. In particular,the low inclusion of the material subcategory “education/research”, which is a finding in linewith the above-mentioned other empirical studies focusing on coverage rates in theuniversity sector (Sassen and Azizi, 2018a, b; Lopatta and Jaeschke, 2014; Fonseca et al.,2011), is a signal that SRs are not seen as an information source for communicatinguniversity achievements in its core areas. Research is not even listed in 18 universities as amaterial dimension. Only a third of external stakeholders attached a high relevance to thedimension “teaching”. An explanation for this low inclusion of university sector-specificcore mission aspects might be that there are other voluntary and obligatory communicationinstruments (e.g. university rankings, teaching and research excellence reports, knowledgebalance sheets and research prizes) which allow a more focussed communication. On a morefundamental level, this warrants the question about the function SRs have for universities, ifthe listed material aspects have such a low concentration on aspects addressing the coremissions of universities. Given the growing importance that the “third mission” has foruniversities, it came as a surprise that the analysed G4-19 documentations did not mention itat all. Content wise the existing G4-SO1-11 indicators (society) are far from a universitysector-specific understanding of a third mission. In line with Eccles et al. (2012) and theresults of Jones et al. (2015a, b), there are no signs that the documented material aspects arefocussed enough on the sector-specific stakeholder information needs. With the low or norelevance of teaching/research and the third mission important areas of the core universitymandates do not show up. That finding warrants the question about the role SRs have as acommunication instrument for universities and if SRs will ever gain importance as a corecommunication tool.
While all 33 reports provided some form of documentation what stakeholders regard asmaterial and also provide information on the relevance level, the documented materialaspects did not work as a content-selecting principle for the SRs. RQ2 on the coveragerates of the documented material aspects was addressed by performing a quantitativecontent analysis and a correlation analysis. These analyses showed that there is nocorrelation between the classification as a material dimension and its coverage rate in thereport. The only exception was in the material dimension “biodiversity” which was notregarded as material by 27 out of 33 universities. Therefore, materiality does not guidethe reported content of the 33 universities’ SR. The results among universities were quitehomogeneous. There was no positive or negative outlier. Even the ETH Zürich, which hadthe most advanced materiality matrix, did not perform well in the way it addresses thedocumented material aspects in its SR. This result can be underlined by the correlationanalysis of the ETH Zürich that showed no significance at a level of 0.05 as well as at alevel of 0.01.
Interpreting the findings through the two theoretical lenses, the following can be stated:the G4-reporting universities do not use their SRs for what strategic stakeholder theorysuggests. The gap between the G4-19 listed information needs of external and internalstakeholders on material aspects and the information provision by the SRs is too wide.All 33 universities do not walk the extra mile, suggested by strategic stakeholder theory forusing SRs as part of a resource-flow securing stakeholder management. The reportingpractice is also far from the idea of a holistic stakeholder accountability, suggested by
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Puroila et al. (2016). As nearly 2/3 of the universities in the sample are public or non-profituniversities, one would have expected a better information provision in this group dueto a higher priority of a broad societal mission. t-Tests on the coverage rates did not supportthis expectation.
The findings of this study are in line with prior research which also observed a lack ofstakeholder orientation of SRs (Diouf and Boiral, 2017; Puroila et al., 2016; Ceulemans et al.,2015; Lozano et al., 2015; Deegan and Rankin, 1997). Putting materiality on the central stage,as done in GRI G4, has not improved in any meaningful way that the documentedstakeholder information needs receive enough attention in the SRs as a content-selectionprinciple. The core intention of the materiality principle defined by the GRI is not put intoreporting practice and the fact that the materiality principle of the GRI G4 is a ticking-offexercise for the analysed universities can be confirmed.
In line with sociological institutionalism, the SRs do not focus in a comprehensive way onthe material aspects listed in GRI G4-19. This result supports the claim of Bebbington et al.(2009), that the influence of sustainability reporting guidelines can be low with respect tothe selection of the reported content. Sustainability reporting guidelines as a weakpressure (Shabana et al., 2017; Bebbington et al., 2009) opens discretionary space for a lowimplementation in a field where sustainability reporting is not an institutionalised practiceand where other, more established voluntary accountability clubs are well established(e.g. accreditation of business schools, ranking of HEIs). The required documentation inG4-19 deteriorates to a symbolic exercise without any substantial consequences for thecontent of the SRs. The documentation of stakeholder-material aspects is deteriorated tomere ticking-off exercise.
SRs are only slowly gaining momentum as a communication instrument of universities,as the literature review in Section 2 showed. Compared to stock exchange listed companies,it might take a very long time till SRs will be an established practice. The weak mimeticpressure also might be an explanation of the low compliance with the materiality principlein the analysed SRs of universities.
Unlike with multinationals, there are no powerful external stakeholders which use theirpower to make SRs de facto obligatory. Neither governments nor external research fundersor teaching quality evaluating agencies demand SRs from universities. Therefore,sustainability reporting has a low relevance in the accountability jungle universities have todeal with. With respect to the analysed SRs, the findings indicate that the universities paylip-service to materiality as a content-selection principle.
Compared to the discussion of materiality in financial reporting, the relevance of themateriality principle as a guidance for selecting the reported content is in sustainabilityreporting in its early stage. The results from the presented empirical study are in line withmost of the studies included in our literature review (Ferrero-Ferrero et al., 2017; Larránet al., 2012, 2016).
The overall disappointing findings for how materiality influences the reported contentraises a fundamental level question about the role SRs have in universities. So far, only asmall number of universities compile SRs which are guided by a sustainability reportingstandard. One sector-specific explanation is that universities use other communicationchannels for communicating and documenting what they have achieved. Financial resourceproviders have the power to demand more specific information than the non-sector-specificG4 Guidelines can offer. Worldwide implementable sustainability reporting guidelines aremost likely too abstract for meeting the specific information needs of international, nationaland regional sector-specific powerful stakeholders (e.g. ministries, research and teachingfunding agencies, research funding foundations, accreditation bodies, etc.). In comparison,materiality of GRI G4 is a ticking-off exercise. To be in line with the GRI requirements,universities make some effort to list material aspects but do not focus their SRs on it which
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leads to a low internal consistency of the SRs. What is reported is not in line with thedocumented outcome of the stakeholder engagement process. Therefore, we conclude thatthe reporting quality in the case of materiality is low.
With this study we add to the debate about the implementation of the materiality principlein SRs. In comparison to the academic body of research focusing on materiality in financialaccounting, the body of literature on the implementation practice in SR is at the beginning, asthe literature review has shown. By focusing on universities, the paper analyses a field wherethe diffusion rate of sustainability reporting guideline-guided SRs is so far low and thereforeno mimetic pressures exist. This study also contributes to evaluating the state of the art ofSRs in a sector with a broad societal mission and a rather pluralistic stakeholder structure.Theoretically, the findings support more the low expectations of sociological institutionalismfor the implementation of materiality as a content-defining principle than the highercompliance expectation in line with strategic stakeholder theory which suggests that underresource-providing aspects the orientation of SRs on the information needs of definite,dominant or dangerous stakeholders should be high. The high hopes that the materialityprinciple will be a great step forward towards SRs focussing on highly stakeholder-relevantaspects proved to be unrealistic in the case of the analysed 33 SRs.
In line with the findings, the following practical implications can be derived. Concerningthe standard setters, they should provide clear guidelines what the materiality principle is anda user-friendly manual how to report on the materiality indicators. In case of the principle ofmateriality, it is necessary that the role of the materiality matrix, that is part of the G4indicators (mainly G4-19–G4-22), is well introduced so that the users of the GRI Guidelines areable to adapt the materiality principle in its core. Besides, preparers of SRs should make abetter use of the information they collect from highly or medium salient stakeholders in thestakeholder engagement process. A concentration of highly relevant material topics inreporting would improve the stakeholder orientation in the field of sustainability reportingand reduce the risk of being accused of greenwashing or hypocrisy.
A major limitation of this study relates to the small number of university G4 reportsavailable. The second limitation, shared with other studies using content analysis as aresearch method, is that the documented picture does not allow any conclusions about theactual preferences of internal and external stakeholder groups for material aspects. A thirdlimitation is that this study focused on SRs which are only one written form of stakeholdercommunication. Therefore, for analysing the communication on sustainability performance,further research could extend the research to other forms of stakeholder communication (e.g.social media and financial reports). Further research should be conducted about universities’motives in publishing SRs and their attitudes on the benefits of materiality for improvingtheir decision making. It also might be worthwhile to investigate the function SRs fulfilcompared to other university sector-specific accountability instruments and stakeholdercommunication channels (websites, press releases, obligatory reports to funders, etc.). Thelow implementation rates of SRs in universities might be caused by an accountabilityoverload. The value-added of compiling a SR might be lower than meeting the specificcompulsory reporting obligations of a research or teaching excellence framework.
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Corresponding authorMelanie Lubinger can be contacted at: [email protected]
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Univ.-Prof.in Dr.in Dorothea GreilingJohannes Kepler Universität Linz, lnstitut für Management Accounting
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Appendix 2
Paper Two: Frei, J., Lubinger, M. and Greiling, D. (2020), Assessing Universities’ Global
Reporting Initiative G4 Sustainability Reports in Concurrence with Stakeholder Inclusiveness,
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Reporting and Beyond, Public Sector Financial Management, Palgrave Macmillan,
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35© The Author(s) 2020F. Manes-Rossi, R. Levy Orelli (eds.), New Trends in Public Sector Reporting, Public Sector Financial Management, https://doi.org/10.1007/978-3-030-40056-9_3
Assessing Universities’ Global Reporting Initiative G4 Sustainability Reports in Concurrence with Stakeholder
Inclusiveness
Judith Frei, Melanie Lubinger, and Dorothea Greiling
Motivation and ReseaRch Questions
In the public and private sectors, stakeholder accountability demands have increased considerably, leading to many forms of obligatory and voluntary reporting practices. New Public Management (NPM) has been a main driver in the public sector for the increased accountability pressures. The managerial drive of NPM reforms has affected the role and functions of public universities as well as values of higher education (Parker 2011). As a result, universities across the globe are moving towards a market-driven enterprise culture (Parker 2011; Lucas 2006). Universities are confronted with rather pluralistic accountability demands by a broad spectrum of
J. Frei (*) • M. Lubinger • D. Greiling Institute of Management Accounting, Johannes Kepler University, Linz, Austriae-mail: [email protected]; [email protected]; [email protected]
36
stakeholders. To address their main stakeholders, universities engage in a variety of accountability activities. Sustainability reporting is one of them.
Sustainability reporting has gained relevance especially amongst multi-national private sector companies and to a lesser degree for the public and the non-proit sector (Cho et al. 2015; Manetti and Toccafondi 2014; Guthrie and Farneti 2008). Sustainability reporting is a reaction to stake-holder pressures, resulting in reputational, competitive, political and mar-ket opportunities (Burritt and Schaltegger 2010). Proponents of sustainability reporting stress its contribution to an increase in transpar-ency and accountability (James 2015; Malik 2015; Burrell and Roberts 2014; Baker 2010). Critical accounting scholars are sceptical as to whether sustainability reporting does improve stakeholder accountability. It is seen as a public-relation endeavour without substance, a greenwashing attempt or a strategic impression management tactic (Burritt and Schaltegger 2010; Gray 2010; Hopwood 2009). The voluntary nature of sustainability reports (SRs) provides room for presenting an organisation in a too posi-tive way by selective, incomplete and biased disclosures (Cho et al. 2015).
As a remedy for the improving stakeholder accountability of SRs, stake-holder inclusiveness (SI) is advocated by sustainability reporting guidelines. Organisations have to establish a stakeholder engagement (SE) process in order to understand what key stakeholders want to know. A well-advanced SE process is seen as a core requirement for a higher quality of sustainability reporting and towards SRs that focus on stakeholder- material aspects.
However, whether SI leads to improved stakeholder accountability is an open question. On the one hand, meeting the information needs of rele-vant stakeholders under resource-providing aspects is in line with strategic stakeholder theory. On the other hand, prior research on sustainability reporting practices, using neo-institutionalism as a theoretical lens, pro-vides arguments that SRs are not focused on stakeholder-relevant aspects and therefore stakeholder accountability is most likely low (Shabana et al. 2017; Higgins and Larrinaga 2014; Bebbington et al. 2009).
Concerning the institutional ield, this chapter concentrates on univer-sities, which are an interesting ield to study because of their complex social mandate (Ntim et al. 2017). Compared to other sectors, studies evaluating the state of the art of sustainability reporting are still at an early stage (Ferrero-Ferrero et al. 2017; Ceulemans et al. 2015). Combining this with a focus on SE is an even lesser addressed topic (Ferrero-Ferrero et al. 2017; Hinson et al. 2015). Universities are also interesting to study because the number of key stakeholders who hold universities accountable has increased considerably in the past decades.
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Based on a systematic literature review and an empirical study the fol-lowing research questions (RQs) are addressed:
RQ 1. What are the main stakeholder groups and topics of universities identi-ied by SE indicators of Global Reporting Initiative (GRI) G4?
RQ 2. To what extent do universities comply with the GRI G4 Guidelines (general and speciic standard disclosures) and how are the documented main topics of the SE process covered by G4 reports?
To address RQ1, the indings from a systematic literature review on the key stakeholder groups and their information needs are combined with the results of what is documented in the most recent GRI G4 reports. The GRI Guidelines are chosen because they are still the most widely applied sustainability reporting guidelines and allow a global comparison. To gain an insight into RQ2, prior studies in GRI G4 Guidelines compliance serve as a basis for analysing the extent to which public and private universities of our sample comply with the GRI G4 Guidelines in order to evaluate whether the information disclosure in the SRs is a comprehensive or supericial one.
The remainder of the paper is structured as follows:In Section “Theoretical Background”, strategic stakeholder theory and
neo-institutionalism are introduced to identify arguments for and against comprehensive stakeholder accountability in universities’ SRs. After a very brief introduction to sustainability reporting frameworks in the university context, Section “Sustainability Reporting at Universities and Prior Empirical Studies” presents the main results of a systematic literature review and discusses main stakeholders, their information needs and the adoption of sustainability reporting guidelines. Section “Methodology, Sample Description and Findings” then presents the research design of the study along with the indings. A concluding assessment of the research questions is presented in Section “Conclusions and Directions for Further Research” together with a short discussion, as well as limitations and implications of this research project.
theoRetical BackgRound
Although there is a broad stream of literature of theoretical relections on general motives, implementation levels in and across countries and factors driving the implementation of SRs (Shabana et al. 2017; Cho et al. 2015),
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studies focusing on sustainability reporting in universities are not always theory-based (Sassen and Azizi 2018b; Gamage and Sciulli 2017; Bice and Coates 2016; Larrán et al. 2016; Lopatta and Jaeschke 2014; Ralph and Stubbs 2014; Lozano et al. 2013; Siboni et al. 2013; Fonseca et al. 2011; Lozano 2011). The theory-based ones primarily use three theories con-cerning the relationship between universities and their stakeholders: stake-holder theory, legitimacy theory and neo-institutionalism (Brusca et al. 2018; Larrán et al. 2019; Sassen and Azizi 2018a; Dagiliene and Mykolaitiene 2016; Hinson et al. 2015; Larrán et al. 2012; Mainardes et al. 2012).
In this chapter, strategic stakeholder theory and neo-institutionalism are used for formulating contradictory expectations about high or low guideline compliance and for assessing the extent to which SRs are guided by the results from the SE process.
Strategic stakeholder theory, introduced by Freeman (1984) to a wider audience, is used for making a pro-argument. Strategic stakeholder theory stresses that a cooperative relationship of an organisation with its most relevant stakeholders is essential (Freeman et al. 2004). In strategic stake-holder theory, the stakeholder focus is limited to co-operations based on economic usefulness. An excellent relationship with key stakeholders cre-ates a win-win situation that unlocks an additional potential for value cre-ation (Harrison et al. 2010; Freeman et al. 2004). Two essential preconditions for stakeholder-oriented SRs (in the university sector and outside) are that the reporting entity knows who the most relevant stake-holders are and understands the main information needs these key stake-holders require. Meeting the information needs of key stakeholders is an integral part of strategic stakeholder management. In line with strategic stakeholder theory, it can be argued that SRs of universities should be focused on the information needs of key stakeholders. To know who the key stakeholders are is one main aim of the SE process; the second aim is to know what information key stakeholders regard as relevant. The GRI G4 Guidelines demand that the preparer lists the information needs and classiies them as low, medium or highly relevant. Moreover, SRs should be focused on the stakeholder-relevant aspects in order to unlock the value potential suggested by strategic stakeholder theory. Under the resource- securing aspects, it is therefore essential that universities’ SRs show high compliance with the information needs of key stakeholder groups. This reasoning is in line with the ‘outside-in’ approach of Burritt and Schaltegger (2010) towards sustainability reporting.
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Knowing and prioritising the information needs of key stakeholders is not a simple task for universities because substantial changes in the univer-sity sector have led to a situation in which universities are nowadays con-fronted with a wide range of heterogeneous accountability demands of internal and external stakeholders. The stakeholder audiences which hold universities’ management accountable have increased considerably (e.g., ministries, other public research funders, private foundations, current and potential students and staff, business partners, employers of graduates, alumni) in the last two decades (Ntim et al. 2017).
For a counterargument resulting in low stakeholder orientation and low stakeholder accountability, neo-institutionalism is used. This theory focuses on the inluences of societal pressures on organisations. Coercive, normative and mimetic isomorphisms are drivers for complying with soci-etal pressures for legitimacy and survival reasons (Higgins and Larrinaga 2014; DiMaggio and Powell 1991). Coercive isomorphism requires com-pliance with external norms imposed by the state and other powerful actors with sanctioning rights. In the case of normative isomorphism, pro-fessional standards are the driver for management practice (DiMaggio and Powell 1991). When organisations imitate seemingly more successful peer organisations, DiMaggio and Powell (1991) label such behaviour as mimetic isomorphism.
So far sustainability reporting and in particular guideline-compliant SRs are still an emerging practice for universities, although there have been a few voluntary endeavours towards SRs. The institutionalisation process of sustainability reporting is not well advanced. In addition, universities are starting to integrate information on selected aspects of their sustainability performance, mostly in an unsystematic way. In the past years, the guide-line compliance has been low. Sustainability reporting is not yet a relevant professional practice for universities. A decent position in international ranking or accreditations in business schools is much more important than sustainability reporting for most universities under the strategic position aspects. Mimetic isomorphism requires that the non-complying universi-ties regard it as risky not to adopt this practice. This can also be ruled out due to the low number of universities publishing SRs. Coercive isomor-phism requires external stakeholders with powerful sanctioning rights. Only the Spanish province of Andalusia has introduced an obligation to implement SRs in the university sector. Sustainability reporting is a volun-tary endeavour in nearly all regions of the world and sustainability
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standard setters have de facto no sanctioning power. Therefore, coercive isomorphism can also be ruled out as a strong pressure.
Summing up these counterarguments, it is likely that sustainability reporting guidelines can be classiied as a weak pressure and therefore most likely lead to low compliance. Stakeholder orientation, and in conse-quence stakeholder accountability, is most probably supericial and far removed from holistic stakeholder accountability. The GRI Guideline compliance in this case will most likely be low.
sustainaBility RepoRting at univeRsities and pRioR
eMpiRical studies
Universities play a fundamental role in contributing to a more sustainable society and in the integration of sustainable development in society. Sustainability assessment and reporting are regarded by some authors as a relevant part of sustainability efforts by universities (Alonso-Almeida et al. 2015; Lozano et al. 2015; Lozano 2006). For evaluating the content of universities’ SRs, quite a few normative assessment frameworks exist (for an overview, see Larrán et al. 2016; Ceulemans et al. 2015). Frequently referred to university sector–speciic assessment frameworks are those by Lozano (2006), Fonseca et al. (2011) and frameworks which augment the GRI Framework with additional sector-speciic indicators (e.g., Lopatta and Jaeschke 2014; Sassen et al. 2014). All sector-speciic frameworks have the disadvantage that they were developed in a particular institutional context, predominately in North America and Europe, which makes them less suitable for international comparison. Only the GRI and the International Integrated Reporting Council (IIRC) have developed vol-untary worldwide reporting guidelines, which are also used in the univer-sity sector. The drawback of both is that they are not sector-speciic.
The majority of empirical studies focusing on the status quo of sustain-ability or integrated reporting in universities use various versions of the GRI Guidelines (Larrán et al. 2016). Despite the rising relevance of inte-grated reporting, the GRI Guidelines are still the most widely used ones for preparing and assessing the current state of an organisation’s eco-nomic, environmental and social performance for universities (Alonso- Almeida et al. 2015; Lopatta and Jaeschke 2014; Lozano 2006).
To achieve transparent, stakeholder-oriented accountability, the GRI Guidelines deine reporting principles concerning the report quality and
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report content (GRI 2013). The principles for deining the content of SRs consist of SI, sustainability context, materiality and completeness. To apply the principle of SI, GRI requires that “the organization should iden-tify its stakeholders, and explain how it has responded to their reasonable expectations and interests” (GRI 2013: 16). The importance of SE within universities is also stressed by scholars and is seen as a demanding process due to the plethora of key stakeholders, which might also be a barrier for integrating sustainability in universities (Blanco-Portela et al. 2017; Disterheft et al. 2015).
Prior Empirical Studies
Empirical studies on the state of the art of sustainability reporting prac-tices of universities are on the rise, but so far, it is still an under-researched ield as the systematic literature review resulted only in 22 studies. The search period was from 2000 to 2018, limited to peer-reviewed English journal articles.
Content-wise three main clusters were identiied, namely single case studies on the SI, studies addressing stakeholder expectations and studies on the guideline compliance of SRs. While the irst two clusters refer to RQ1, the third cluster provides some insight into RQ2.
SI in Selected Sustainability Reports/Integrated Reports (Three Studies)
Regarding RQ1, the literature review revealed three single case studies dealing with SI. Brusca et al. (2018) analysed the implementation of sus-tainability and integrated reporting at the University of Cadiz by applying the framework of Secundo et al. (2016). As the most important stake-holder group, the university’s social council could be identiied as a repre-sentative of other stakeholders with the aim of enhancing competitiveness and attaining third mission objectives. In addition, auditors represented an important stakeholder group, based on the fact that they supported the integrated reporting implementation process. According to the Spanish case, SI plays a key role in the value-creation and strategic-management processes. Veltri and Silvestri (2015) investigated the integrated report (IR) of the Free State University in South Africa to answer the question as to whether intellectual and non-intellectual capital content was included and interconnected within one single report to enhance stakeholders’
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information needs. Due to the results, content elements of the IIRC Framework were mentioned but there was neither any capital-speciic reporting nor any reporting on the interconnectedness of the capitals. When deining report content, managers of the university did not consider stakeholder interests; furthermore, there were no references concerning a stakeholder dialogue. Lozano et al. (2013) described the SR preparation process of the University of Leeds as an ‘inside-out’ approach. It was a management decision not to consider stakeholders’ interests.
A common inding of the three identiied single case studies is that dif-ferent stakeholder groups should be engaged to develop and validate SRs, but with the exception of the Andalusian case, external stakeholders’ inter-ests were not considered in a systematic way.
Internal and External Stakeholder Expectations (Five Studies)
Referring to the main topics identiied by SE, ive studies were found. Ferrero-Ferrero et al. (2017) analysed the SE techniques in SRs in depth. Surveys, stakeholder workshops and panels have been mostly applied by more than the half of the analysed G4 SRs. For an in-depth analysis of stakeholder expectations, a case study was conducted in a Spanish univer-sity. Economic and environmental issues, labour practices and decent work, human rights, local communities and ethical issues were the most mentioned expectations of stakeholders. Furthermore, the compliance rate between the expectations of internal stakeholders and the docu-mented material aspects has been analysed. In Andalusia, sustainability reporting of universities is obligatory. In a working group with senior managers of eight public Andalusian universities, stakeholder material aspects for a sustainability assessment and reporting tool were identiied (Larrán et al. 2016). A total of 155 material aspects clustered into seven categories were found: corporate governance, students, staff, society, envi-ronment, companies and continuous improvement. The categories of cor-porate governance and environment showed the highest relevance, followed by students, staff and society. In a prior study, Larrán et al. (2012) analysed expectations of stakeholder groups of ten public universities in Andalusia. All stakeholder groups required more information on gover-nance of universities, employability and value education for students, uni-versities’ commitment to society, transferability of university research to companies and the allocation of resources. Ralph and Stubbs (2014) investigated factors that inluence the integration of environmental
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sustainability at four English and four Australian universities. Stakeholder pressure was identiied as the second most important driver for providing information on the environmental sustainability in the eight SRs. In the analysis of students’ expectations at 11 public universities in Portugal, the ‘academic level of demand’ or employability played the most important role, but also improvement of partnership with the university staff, employ-ability, personal fulilment and the current environmental conditions were mentioned (Mainardes et al. 2012).
A common inding of all ive papers is that stakeholder information needs are quite extensive. The four papers focusing on more than one stakeholder group also revealed the great heterogeneity of stakeholder expectations.
Based on the systematic literature review the following can be con-cluded with respect to RQ1. The small number of studies shows that this is still an under-researched ield. Prior literature primarily focuses on the plethora and variety of information needs of key stakeholders. Studies ana-lysing SE-activities of universities and empirically investigating and rank-ing the main stakeholder groups and topics within universities are far less frequent.
(Coverage) Analysis of SRs/IRs Based on the GRI Guidelines (14 Studies)
Moving on to RQ2, few studies exist which focus on a quantitative guide-line compliance. As displayed in Table 1, ten studies report on total cover-age rates (TCRs) or speciic coverage rates of performance dimensions, while two out of them provide additional insights into SE.
Table 1 Studies reporting on TCRs of speciic coverage rates
Author(s) (year) TCR Economic Environmental Social Educational SE
Fonseca et al. (2011) 36% 19% 63% 21% 25% 57%Lozano (2011) 11% 17% 7% 6%Lopatta and Jaeschke (2014) 26% 25% 29% 14% 30%Sassen et al. (2014) 40% 31% 11% 27%Hinson et al. (2015) 57% 67%Romolini et al. (2015) 64% 49% 53%Gamage and Sciulli (2017) 9% 63% 31% 52%Larrán et al. (2019) 44% 54% 41% 44%Sassen and Azizi (2018a) 4% 15% 1% 13%Sassen and Azizi (2018b) 11% 30% 7% 21%
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Additionally, four studies provide insights into selected aspects, for example, selective triple bottom line (TBL) indicators of universities’ SRs (Bice and Coates 2016) or selected TBL indicators of the GRI G3 Guidelines in Lithuania’s tertiary sector institutions (Dagiliene and Mykolaitiene 2016). In nine Italian university SRs, Siboni et al. (2013) found a low consistency with the GRI Guidelines. Italian universities applied Italian and international guidelines. Zorio-Grima et al. (2018) found that nearly one third of 49 public Spanish universities reported on the GRI indicators, but only 6 out of 49 registered their reports to the GRI.
The (quantitative) coverage of SE in SRs was an issue in four studies in this cluster. Sustainability reporting is seen as a communication instru-ment to satisfy stakeholder demands (Sassen and Azizi 2018a, b; Lozano 2011) with the ability to improve stakeholder relations (Gamage and Sciulli 2017) and to lower information asymmetries (Lopatta and Jaeschke 2014). Bice and Coates (2016) revealed that all ten universities included in the analysis provided information on internal and external stakeholders. Hinson et al. (2015) found that four out of six universities included infor-mation on their SE process. Four of the nine examined Italian universities engaged with their stakeholders at different levels within the sustainability reporting process (Siboni et al. 2013). Fonseca et al. (2011) state that four out of seven analysed universities reported on SE. Coercive pressure from resource-providing societal key stakeholders was mentioned as a possible reason for including information about sustainability in annual reports of universities (Hinson et al. 2015; Fonseca et al. 2011).
Summing up, the following can be concluded: Although the potential of sustainability and integrated reporting for the improvement of stake-holder accountability is emphasised in many papers of the systematic lit-erature review, detailed information on the SE process and SI is not well addressed, with the exception of one study which analyses SE techniques, stakeholder groups and stakeholder expectations (Ferrero-Ferrero et al. 2017). Studies analysing universities which address main stakeholder groups and main communication topics are scarce. Only selected aspects of the information needs of stakeholder groups were analysed and the stakeholder focus of the studies was unbalanced. The indings of Ceulemans et al. (2015) that the importance of SE within the sustainability reporting process is under-researched is still valid. There is no study analysing the it
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between the documented topics and the coverage rates of universities’ SRs in the SE process analysed. What is missing is a systematic analysis of the main stakeholder groups as well as additional information on the commu-nication topics universities focus on in their stakeholder dialogue. Additionally, there is no study analysing whether the relevant topics iden-tiied in the SE process are indeed reported in the GRI G4 SRs. Addressing this research gap is a relevant issue if one recalls that nowadays universities have to position themselves strategically within a broader group of stakeholders.
Methodology, saMple descRiption and Findings
Methodology and Sample Description
The assessment of SRs is based on G4 Guidelines. The sample consists of 33 SRs in line with G4 that have been uploaded until April 2018. Therefore, we excluded all other kinds of SRs of universities that are not in line with the GRI G4 Framework.
Regarding the geography of the analysed universities, they are distrib-uted in the following way: two universities are from North America, eight from Europe, eight from Asia and two from Australia. Twenty universities are private and 13 are public. Besides this, the numbers of students per analysed university varies from 42% under 15,000 students to 49% between 15,001 and 55,000 students, to 9% over 55,000 students. Of these, 36% were ranked by one of the following major ranking institutions: Times Higher Education (THE), QS World University Ranking (QS)], Academic Ranking of World Universities (ARWU).
For empirically investigating the two research questions, a mixed- method research design was used. It included two different content anal-yses—a qualitative one and a quantitative one—followed by a correlation analysis. Two persons coded them independently and the discrepancies were discussed and reconciled.
A qualitative content analysis was completed to analyse the documented SE of universities based on the reported G4 SE indicators. For this the G4-24 to G4-27 indicators of the 33 SRs were analysed. These indicators give an overview of the SE activities of the universities including a list of addressed stakeholders and the main topics universities communicate to their stakeholders. In a irst step of the qualitative content analysis, the stated topics and stakeholders of each university were identiied. In a
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second step, the stakeholders and identiied topics were clustered and summarised into stakeholder groups and main communication topics.
In the quantitative content analysis, compliance rates for the Standard Disclosures of G4 SRs as well as for the Speciic Standard Disclosures such as economic, environmental and social with its subcategories of labour and decent work, human rights, society and product responsibility were calcu-lated. For each category, a compliance level was calculated as shown in the following example.
Example: Category EconomicNumber of economic performance indicators: 13University 1 reports 7 of 13Compliance level: 7/13∗100 = 53.85%The classiication of the compliance levels is the following: no cover-
age = 0, > 0–33.33% = 1, > 33.33–66.66% = 2 and > 66.66% = 3.
In a inal step, a correlation analysis between the main topics universi-ties communicate to their stakeholders and the compliance rate was per-formed. This was done to evaluate the it between the topics documented in G4-26 and G4-27 and the indicator-based parts of the SRs. To evaluate this it, the indicators and their extension of coverage in the form of the calculated coverage rate of the GRI reports were used. For strategic man-agement the General Standard Disclosures—for inance the coverage rate of the category economic and for sustainability the TCR that is in line with the triple-bottom-line principle—were used. The other high-scoring SE topics identiied, such as research information, education programmes and campus life, could not be included in the regression analysis because GRI G4 does not cover these topics.
To test the correlation, the following hypotheses were formulated:
H0: There is no correlation between the two groups. The identiied main com-munication topic has no inluence on the coverage of this topic in the report content of G4 SRs.
H1: There is a correlation between the two groups. The identiied main com-munication topic has an inluence on the coverage of this topic in the report content of G4 SRs.
To interpret the results of these correlations, the Spearman correlation coeficient was used. If the p value is under the signiicance level of 0.05
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the null hypothesis is rejected and a correlation between the two groups exists. A positive correlation means that the extension of reporting on the identiied main communication topic in the stakeholder process of G4 SRs is aligned with the value of this topic according to the SE process. For example, if an identiied main communication topic of the SE process such as strategic management issues, sustainability and inance is valued as highly important, the coverage of this topic in the SR is also at a high level. If there is a negative correlation or no correlation, the identiied main communication topics of the SE process are not reported accordingly in the SRs.
Findings
Concerning the main stakeholder groups addressed by certain universities, the analysis shows that 93.33% of the investigated universities report to the university assembly. This group includes the head of the university, head of departments as well as the university council. Other frequently mentioned stakeholder groups are university staff (scientiic and non- scientiic), students and government. Only 36.67% of the analysed univer-sities mentioned parents and public media partners (33.33%) as important stakeholders.
The most important communication topics that are addressed to the certain stakeholder groups are issues concerning strategic management like vision, strategic objectives as well as upcoming strategic changes of the reporting universities. Information on sustainability, education pro-grammes, research information and campus life are also very relevant top-ics in the communication of universities towards their main stakeholders. Other important topics that have been identiied are inance and legal issues.
Considering the results of the quantitative content analysis, there are differences within certain categories. In terms of the General Standard Disclosure compliance, which includes strategic management information as well as information on the universities’ proile, it can be stated that 30% of the universities have a rate between 80% and 100%, 30% a rate between 79% and 60%, and 40% a rate between 59% and 40%. No university that was analysed has a coverage rate of the General Standard Disclosures under 40%.
We further analysed the coverage rates within the six GRI categories. The results are represented in the form of pie charts and tables. There are
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pie charts for every GRI category that show the detailed coverage of each indicator. The additional tables show the general coverage of the category.
A criterion for this analysis was the question of whether the investigated universities report more than 50% of indicators of certain categories. As for the Economic category, 46.67% of the universities that have been investigated report more than 50% of all indicators. Eleven out of the 33 (33.33%) universities report more than 50% of the indicators in the Environmental category. As for the Social – Labour Practices and Decent Work category, 50% of all reports have a coverage rate of over 50%. In terms of the categories of Social – Human Rights, Society and Product Responsibility, 26.67% of the investigated universities report more than 50% of the indicators. Summing up, this means that 10 out of 33 universi-ties use more than 50% of the stated indicators of the GRI Framework and 23 universities report less than 50% in these three categories (Human Rights, Society, Product Responsibility). Consequently, the categories with the top coverage rates are the Standard Disclosures, and in the social dimension, the subgroup Labour Practices and Decent Work followed by the Economic and Environmental performance.
The TCR of the analysed SRs are the following: 8 universities (24.24%) have a coverage rate between 80% and 100%, 2 universities (6.06%) between 79% and 60%, 4 universities (12.12%) between 59% and 40% of all indicators, 16 universities (48.48%) between 39% and 20% and 3 uni-versities (9.09%) report less than 20% of the indicators from the G4 line.
However, the mere quantitative coverage rates do not allow an assess-ment if the main communication topics that are identiied in the SE pro-cess are in fact reported in the G4 SRs. The correlation analysis of the main communication topics identiied of the SE process had no statistical signiicance. The main communication topics of the SE process are not reported at an adequate coverage level in the G4 SRs. Therefore, the G4 SR is not a main reporting tool for the identiied topics of the SE process.
conclusions and diRections FoR FuRtheR ReseaRch
The indings are based on the results of a systematic literature review and an analysis of the most recent 33 GRI G4 SRs worldwide uploaded in the GRI database. The low number of relevant prior studies as well as the fact that only 33 reports were uploaded clearly limits the generalisability of the results. Therefore, our results only provide a irst insight into an under- researched ield.
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With respect to RQ1, the results of the systematic literature review showed that prior studies focused primarily on information needs of uni-versity stakeholders. Less systematic was the evaluation of main stake-holder groups. Moreover, the analysis of the relevant stakeholder groups had a narrow focus because they were limited either to one single case (Brusca et al. 2018) or to a small sample number of universities (Ferrero- Ferrero et al. 2017). Although the multitude and the interests of different stakeholder groups are emphasised in the studies, only Brusca et al. (2018) identiied the university’s social council as the main stakeholder group and a key driver for sustainability reporting. Ferrero-Ferrero et al. (2017) identiied stakeholder groups of ten SRs worldwide to answer the question of whether material aspects mentioned by internal stakeholders are aligned with the documented aspects in the SRs. Our own empirical study showed that universities clearly document who their main stakeholders are. The indings reveal that a mixture of internal and external stakeholder groups are in line with the expectations of the heterogeneity of main stakeholder groups in the university context. Seven different stakeholder groups were classiied in the analysed 33 SRs as highly relevant. While the systematic literature review identiied a rather unstructured and wide list of potential information needs concerning topics such as corporate governance and environment, employability or university quality standards for degrees (e.g. Larrán et al. 2012, 2016; Mainardes et al. 2012), our own study showed that universities are able to identify main communication topics with their main stakeholders as required by the GRI G4 Guidelines. The topics are a mixture of general management topics (strategic management issues, sustainability, inance and legal issues) and university-speciic aspects (education programmes, research information and campus life). Information on sustainability is regarded as highly relevant. A caveat is that the reports are quite vague regarding what is meant by sustainability.
Regarding RQ2, the results are far less positive. The systematic litera-ture review revealed ten studies analysing quantitative guideline compli-ance by reporting on total or special coverage rates. Two studies out of them report on SE (Hinson et al. 2015; Fonseca et al. 2011). None of these studies analysed the coverage of main communication topics of the SE process. Our empirical study showed that the coverage of these catego-ries in the 33 analysed G4 SRs is not in line with the relevance of the main communication topics identiied in the SE process. There is no statistical correlation between the relevance of main communication topics which universities document as the outcome in the SE process and the coverage
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of these topics in the analysed G4 SRs. Therefore, the main topics of the SE process that are addressed are not covered in an adequate way in the G4 SRs.
Besides this, the indings indicate that sustainability reporting, in par-ticular the guideline-driven one, is still in its early stage in the university sector. The literature review revealed TCRs and coverage rates of selected performance indicators are on average less than 50% (with the exception of the study of Hinson et al. 2015, with an average of 57%). This is in line with our result: in our global sample of all GRI G4 registered SRs, 19 out of 33 universities have a TCR of less than 40%. The indings can be inter-preted as a clear sign that SRs of universities are far removed from compre-hensive guideline compliance. While low levels of coverage might be tolerated for the time being, it might ire back if the practice matures in the sector. Then selective reporting might be seen as a greenwashing attempt.
As shown by the systematic literature review, the small number of SRs available for an analysis is something we share with other quantitative con-tent analyses in the university sector (between 6 and 28 reports). Only Larrán et al. (2019) had a larger sample size, as they analysed 138 SRs published from 58 universities on the GRI website, following the G3, G3.1 or G4 Guidelines.
Theoretically, the reporting behaviour is more in line with the expecta-tions of neo-institutionalism than with strategic stakeholder theory, which stresses the value-adding potential of a stakeholder-oriented reporting as an essential part of the stakeholder management process. The small num-ber of reports available and the poor coverage rates of the three triple- bottom- line dimensions are signs that sustainability reporting is not an institutionalised practice.
A closer look at the three isomorphistic pressures might give some indi-cations as to why this is the case, despite the societal relevance universities should attribute towards a more sustainable world. Due to the low imple-mentation rates, universities are not under any mimetic pressure to imitate sustainability reporting as a practice implemented by successful peers. The coercive pressure of GRI (and other sustainability reporting standards) is very low because GRI does not have any direct sanctioning power if uni-versities show low compliance. So far, universities are not under any legal pressures to implement sustainability reporting in line with GRI. Although universities classify seven different stakeholder groups as highly relevant and sustainability is classiied as a highly relevant communication topic,
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stakeholder pressures are not strong enough to cover sustainability issues suficiently. Neither national legislators nor main funders require SRs. Powerful resource-providers use their power to demand accountability reports from universities tailor-made for their speciic information needs. The accountability requirements of public funders of universities vary from country to country, sometimes with different funding categories, for example if it is funding for research or for student programmes. The idea to develop a sector-neutral worldwide relevant sustainability reporting standard might not work under the very speciic accountability require-ments powerful university funders have. The scope of GRI is likely too broad for meeting the speciic information need of powerful stakeholders of universities.
In comparison with other voluntary reputation signals universities can select from, GRI is a weak one. While under reputation-enhancing aspects, best performing accreditation requirements for universities have quite high entrance barriers and require obligatory peer visits, which can result in no accreditation or frequently lead to accreditation with recommenda-tions, the implementation costs of GRI are low, especially if one takes into account the low levels of guideline compliance.
From strategic stakeholder management perspectives, the low focus of the SRs on the topics, which universities document as highly relevant for their communications with main stakeholders, is problematic. Stakeholder orientation is not taken seriously enough. While universities abide by ful-illing a certain coverage rate of GRI SE indicators, this is not mirrored in other parts of the SRs. Universities might not be clear about the role SRs could play in the sustainability performance related to the communication process. To comply with the GRI, G4-24 to G4-27 indicators do not lead suficiently to SRs addressing the main communication topics.
For improving the relevance of SRs in universities, standard setters of GRI SRs might want to consider whether their sector- and industry- neutral approach leads to the desired outcomes. If standard setters are convinced of the need of a high-quality framework for university sustain-ability reporting, it might be worthwhile considering the development of a sector-speciic university supplement.
On a more fundamental level, the question can be raised as to whether sustainability reporting is an appropriate instrument for universities. The beneits of sustainability reporting are far less obvious for universities than in the case of stock-listed companies where sustainability reporting has become a major trend.
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Our study gives rise to a number of future research areas. Future research could investigate the reasons and motives for such a low it between the main communication topics and the SRs. This would require interviews with preparers and powerful stakeholders under resource- providing aspects. Furthermore, our study focuses on universities’ SRs based on G4 Guidelines. Only a very small number of universities across the globe prepare and publish SRs based on GRI Guidelines. It might be worthwhile to investigate if sector-speciic guidelines lead to higher adop-tion and compliance rates in those areas which are regarded by the main stakeholders as highly relevant.
As our study has focused on the documented outcome of the SE pro-cess and therefore only on the preparer-declared outcome, it might also be interesting to investigate the quality of the SE process from the perspec-tive of the main users of SRs.
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Judith Frei is a researcher and senior lecturer at the Institute of Management Accounting at the Johannes Kepler University, Linz, Austria.
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Melanie Lubinger is a researcher and university assistant at the Institute of Management Accounting at the Johannes Kepler University, Linz, Austria.
Dorothea Greiling is a full-professor and head of the Institute of Management Accounting at the Johannes Kepler University, Linz, Austria.
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Appendix 3
Paper Three: Frei, J., Greiling, D. und Schmidthuber J. (2020), “Management Control Systems
in hybrid universities – The case of Austrian public universities”, Qualitative Research in
Accounting and Management (major revision)
Management Control Systems in hybrid universities – The case of Austrian public universities
Purpose – The purpose of this paper is to explore how a member of the European Higher
Education Area (EHEA) responds to New Public Management (NPM) requirements and
copes with the challenge of maintaining academic freedom while simultaneously
complying with legal requirements and enhancing competitiveness by using Management
Control Systems (MCSs) to control one of their key capabilities: research performance.
Design/methodology/approach – The institutional logics perspective serves as the
theoretical lens for analysing how Austrian public universities cope with distinct,
competing logics. To understand their resulting hybrid nature is the aim of this paper. The
concept of MCSs as a package, as developed by Malmi and Brown (2008), informs the
analysis of how Austrian public universities try to achieve their strategic research aims.
The empirical section combines a systematic literature review and in-depth interviews on
research management to identify which MCSs are applied under competing institutional
logics. The investigation was complemented by the analysis of underlying legal
regulations.
Findings – On a global level of control, the logic of academia guides the identified control
types. On an institutional level, research control is centrally directed by government logic.
The application of different control types depends on the level of control considered. Our
findings indicate that Austrian public universities have established a robust set of
management control types on different levels of control that co-exist in a highly
competitive and internally conflicted institutional environment.
Research implications – The scope of this study is limited by the small number (22) of
public universities in Austria. Furthermore, the interaction between the different types of
control and the control effect would be well worth investigating.
Originality/value – This study is the first to analyse the use of MCSs at Austrian public
universities in the context of competing institutional logics. Having experienced
fundamental change over the last two decades, the Austrian public university system is
governed by a wide variety of factors influencing the application of MCSs. Austria was
the first country to implement intellectual capital reporting as obligatory. Additionally, this
paper contributes to the discussion of how knowledge-intensive public organisations cope
with the co-existence of competing logics.
Keywords – Management control systems, institutional logics, research management,
public universities
Paper type – Research paper
2
1. Motivation and research questions
The introduction of New Public Management (NPM) over recent decades in the university
sector has established a new logic: Managerialism has found its way into public
universities, bringing private sector approaches to the management of public services
(Broadbent, 2007) and transforming them into hybrid organisations incorporating elements
of distinct, competing logics continuously and for a long period (Vakkuri and Johanson,
2020; Boitier et al., 2018; Upton and Warshaw, 2017; Lepori, 2016; Pache and Santos,
2013; Thornton et al., 2012).
Today, public universities face the challenge of maintaining academic freedom while
simultaneously complying with legal requirements and enhancing competitiveness. On the
way from a Humboldtian to a market-driven ideal (Kallio et al., 2016) universities must
prepare for these transformations and adapt management accounting practices for steering
one of their key capabilities, i.e., research performance. Effectivity and efficiency must be
increased (Duh et al., 2014; Decramer et al., 2012; Melo et al., 2010; Van der Weijden et
al., 2008). The performance of public universities plays an important role in the allocation
of public or third-party funds, the selection of attractive study locations and even in
employers’ selection of future employees. Since the introduction of NPM, a variety of
accounting practices have been applied: Management Control Systems (MCSs) and
Performance Management Systems (PMSs) (Martin-Sardesai and Guthrie, 2018; Edgar
and Geare, 2013; Chan and Richardson, 2012).
Quality and quantity in research output, performance in international academic rankings,
competitive project-based research embedded in a complex legal and legislative
environment as well as accountability demands have to be reconciled with public
universities’ strategies and objectives (Kirkland, 2008) to enhance research, teaching and
third mission (Melo et al., 2010; Laredo, 2007; Abernethy and Brownell, 1997).
Universities depend on resources from various stakeholder groups, i.e., money from the
government, third parties, industry or student fees, which are partly dependent on
performance targets. Continuous negotiation processes with relevant stakeholder groups
and continual positioning in society have become central tasks (Lechner et al., 2013).
In light of such complexity, this paper investigates the importance of MCSs in managing
competing institutional logics in the public university sector: the academic logic, the
government logic and the business logic (Conrath-Hargreaves and Wüstemann, 2019).
While academic freedom is driven by the Humboldtian ideal to “carry on their research wherever it leads” (Fallon, 1980:19), and although free decisions about peer collaboration
are central in any organisation of professionals (Mintzberg, 1991), governmental
regulation may restrict universities’ decision-making. Institutional logics become evident
in this particular setting of practices: “practices […] are fundamentally interrelated with institutional logics” (Thornton et al., 2012:128). Vice versa, accounting does not address
a specific logic but may help to cope with the copresence of different logics by mediating
between them (Busco et al., 2017). More importantly, reconciling competing logics by
combining activities from each logic is described as a viable strategy to gain legitimacy
(Pache and Santos, 2013). According to Lounsbury (2008), MCSs are characterised by
cultural framework conditions, such as the categories or classifications of a belief system.
Control elements are selected, implemented and applied depending on the prevailing
3
culture. Thus, institutional logics directly influence the MCSs (Ahrens and Khalifa, 2015;
Lounsbury, 2008). In addition, MCSs can help to deal with institutional complexity
through the existence of multiple logics (Schäffer et al., 2015) and accounting may
“contribute to lock different parties” (Busco et al., 2017:196).
The comprehensive investigation of the way MCSs are applied at public universities is still
in its early days. Several types of controls have been studied albeit only in isolation. The
influence of MCSs and PMSs on organisational culture is also receiving increasing
attention. To the best of our knowledge, however, research concerning MCSs as a package
in contexts of institutional complexity at public universities is still lacking. Universities’ value systems and the relation between MCSs and underlying logics have not yet been
analysed, indicating a strong incentive for research.
To address this lack, this paper analyses in depth the case of the 22 Austrian state-funded
public universities from the perspective of universities’ research management. Austria has
been a full member of the European Higher Education Area (EHEA) since 1999, which
was a response to the NPM requirements of the “Bologna Process” (EHEA, 2020) as
initiated in the late 1990s. International competitiveness, comparability, compatibility and
coherence of the final degrees of European universities were to be achieved by creating a
system of internationally comparable degrees, a three-cycle higher education system, the
introduction of a credit system, the support of mobility and European cooperation
concerning quality assurance and evaluation, and the European dimension in the range of
universities. The participating countries agreed to “adopt reforms on higher education on the basis of common key values - such as freedom of expression, autonomy for institutions,
independent student unions, academic freedom, free movement of students and staff”
(EHEA, 2020). While the 48 participating countries determine the basic principles of this
project at the European level, their actual implementation with consideration of the
different educational systems happens at the national level (Lange, 2008; Wächter, 2004).
Regarding the Austrian public university system, a large variety of factors (legislation and
reforms) has influenced the application of MCSs over the last two decades. Due to public
management reforms, universities have experienced a change of values, which in turn has
triggered the implementation of instruments resembling those used in the private sector.
The increased application of quantitative indicators and the strategy of linking rewards to
control indicates a transformed understanding of research management. The Federal Act
on the Organisation of Universities and their Studies (UG, 2002) legally mandates Austrian
public universities’ principles and responsibilities as well as financing and university
governance.
The UG 2002 gave public universities in Austria autonomy and concurrently introduced
accountability. According to the UG 2002, Austrian public universities have to draw up
and publish intellectual capital reports, which present the sphere of action, the intellectual
capital and the performance processes defined in their performance agreement
(distinguishing between human, structural and relationship capital). Performance
agreements must establish quantitative and qualitative performance measures to be
included in the intellectual capital report. Austria was the first country to implement an
intellectual capital report and can therefore look back on nearly 15 years of performance-
4
driven ministerial steering that may influence managerial processes of decision making
and control (Habersam et al., 2013).
To address the research gap identified above, the following research questions (RQs) are
pursued:
RQ 1: What are the guiding institutional logics at Austrian public universities?
RQ 2: Which MCSs are applied at Austrian public universities in the area of research
management?
RQ 3: How do Austrian public universities cope with the existence of (competing) logics
in the application of MCSs?
To answer these research questions and achieve a holistic picture on the macro level, the
empirical section combines a systematic literature review with in-depth expert interviews
on research management to identify the types of management control distinguished by
Malmi and Brown (2008) and the guiding institutional logics. The investigation is
complemented by a document analysis of underlying legal regulations.
The remainder of the paper is structured as follows: Section 2 provides a literature review
of prior research on MCSs and institutional logics. Section 3 presents theoretical
considerations on MCSs and institutional logics. Sample description and methodology are
presented in section 4, followed by data analysis and findings in section 5. Section 6
comprises discussion, contribution and research limitation.
This study extends previous research by drawing on institutional logics to facilitate the
understanding of public universities’ coping strategies when implementing and applying
MCSs. For this purpose, the MCSs-framework of Malmi and Brown (2008) and
institutional logics are used as a theoretical framework. The study provides practical
insights into public universities’ applied management control types and universities’ coping strategies in this institutional environment.
2. Prior research about MCSs and institutional logics at universities
Prior literature on MCSs
To investigate the use of MCSs at universities, a structured literature review (Tranfield et
al., 2003) was conducted using three online databases (Scopus, EBSCOhost and Web of
Science). The search period encompassed 2002 to 2019 and was limited to peer-reviewed
English-language journal articles. A search by title, abstract, keyword, topic and subject
was conducted. The search, combining the keywords “university”, “management control systems” and “research”, yielded 43 relevant papers. The topics identified overlap with
other types of control; consequently, individual articles were assigned to multiple
categories.
Administrative controls (AC)
Over the last two decades, awareness of research management and therefore organised and
professionalised research management structures at universities has increased (Kirkland,
2005; Stackhouse and Day, 2005). In a global survey of the Association of Commonwealth
Universities, Stackhouse and Day (2005) found that the vast majority of universities had a
5
central office for externally funded research projects. Fostering business contacts and
negotiations for financial and time resources were the main responsibilities of such offices
(Hendriks and Sousa, 2013; Sousa et al., 2010; Kirkland, 2005; Stackhouse and Day,
2005). Proactive research management, establishing offices with the primary responsibility
of steering research and developing inter-disciplinary research centres should enhance
research performance (Beerkens, 2013; Kirkland, 2005).
Kirkland (2005) emphasises the existence of research support offices for establishing
effective relationships within the organisation. Supporting facilities should provide
assistance in bureaucratic and administrative tasks (Sousa and Hendriks, 2008), e.g. access
to international journals and support for publishing in English (Gaus and Hall, 2016). Time
management should be supported by research management to enhance research
performance (White et al., 2012). Universities in developing countries generally lack
financial resources for human resource management (Nguyen, 2016; Kirkland, 2005). The
implementation of boundary management should help researchers protect themselves
against more regulation and control (Agyemang and Broadbent, 2015; Sousa et al., 2010;
Sousa and Hendriks, 2008). Cultural-administrative structures should be designed to
protect and enhance motivation (Sutton and Brown, 2016). An appropriate infrastructure
must be provided and an excellent research context, e.g., in the form of group meetings or
research seminars, must be developed (Sutton and Brown, 2016; Bazeley, 2010; Sousa and
Hendriks, 2008). Training and experience as well as opportunities and resources are
important factors for achieving a supportive institutional environment (Bazeley, 2010).
Information and communication technology, human resource management and training
programmes are generally seen as important measures for achieving and enhancing both
competences and motivation (Nguyen, 2016; Bazeley, 2010; Kagaari et al., 2010;
Kirkland, 2008 and 2005). Introducing mentoring programs to support young researchers
(Kirkland, 2005), offering tutorials and workshops (Sutton and Brown, 2016) as well as
international exchange programs may add value to researchers’ work (Nguyen, 2016).
Cultural controls (CC)
Freedom and autonomy in research are fundamental to enhancing research performance
for academics. Although academic freedom remains important to universities’ belief
systems (Agyemang and Broadbent, 2015), the Humboldtian ideal seems to have been
pushed into the background by the new market-driven and managerialist approach (Kallio
et al., 2016). The resulting feeling of being controlled can undermine intrinsic motivation,
which is characterised by researchers’ contribution to research, the process of doing
research and the inherent interest in the subject matter (Sutton and Brown, 2016). Thus,
the challenge of research management is to establish an organisational culture that
maintains this motivation (Sutton and Brown, 2016; Hendriks and Sousa, 2013; Adler et
al., 2009).
Concerning work environment, collegiality plays an important role (Edgar and Geare,
2013). Research culture, i.e. institutional and collegial support and a common
understanding of ‘good’ research, are fundamental (Tucker and Tilt, 2019). Cooperation
and exchange between researchers of different organisational units are important elements
of research culture with regard to avoiding redundancies and inefficiency (Hendriks and
Sousa, 2013; Jin and Sun, 2010; Sousa and Hendriks, 2008), but national and international
6
networking also influences research performance (Edgar and Geare, 2013). Coordination
mechanisms and administrative structures are useful instruments (Sutton and Brown, 2016;
Hendriks and Sousa, 2013). Establishing reputation is central for successful research
(Sousa et al., 2010), and the research manager should have a good relationship with his
employees (Kirkland, 2005). The opinions of peers and the scientific community are
important factors for research (Sousa and Hendriks, 2008), making it nearly impossible to
control employees through hierarchical structures (Hendriks and Sousa, 2013). Managing
a large variety of disciplines, faculties and researchers of different sciences has been shown
to be a substantial challenge (Adler et al., 2009). Intrinsic motivation, appreciation (Edgar
and Geare, 2013; Kagaari et al., 2010; Hendriks and Sousa, 2008; Sousa and Hendriks,
2008), job satisfaction, engagement and work-life-balance influence research quality
(Kagaari et al., 2010). Recruiting the right employees (e.g., by interviews, White et al.,
2012) and facilitating exchange with colleagues are seen as prerequisites for good research
performance (Hendriks and Sousa, 2008), whereas incentives increase the possibility of
hiring appropriate staff (Nguyen, 2016).
Cybernetic controls (CYC)
Research managers have to provide financial resources (governmental funds) as a
prerequisite for research (Sousa and Hendriks, 2008; Kirkland, 2005; Stackhouse and Day,
2005). Resources distribution often depends on research performance (Silander and Haake,
2017). Woelert and McKenzie (2018) analysed the degree to which Australia’s
‘Performance-based research funding system’ has been adapted and found different levels
of implementation in the internal PMS, but the system must be viewed critically (Martin-
Sardesai et al., 2017a and 2017b). Additionally, resources and infrastructure are necessary
to enhance performance (Gaus and Hall, 2016). ‘Learning and growth’ is an important
perspective of the PMS (Sousa et al., 2010; Umashankar and Dutta, 2007; Cullen et al.,
2003), while human capital and management systems serve to control processes (Rahimnia
and Kargozar, 2016). Such systems also serve as performance measures to satisfy national
requirements (Martin-Sardesai and Guthrie, 2018). ter Bogt and Scapens (2012) analysed
PMSs in the Netherlands and in the UK and found that performance measures may inhibit
creativity in teaching and innovation in accounting and research.
In addition, research quality systems and peer-evaluation are applied (Sousa et al., 2010;
Hemlin and Rasmussen, 2006). International journal rankings and the inherent
quantification of evaluation must be viewed with scepticism (Sousa et al., 2010). Quality
management is moving from control to monitoring, while interdisciplinarity and
stakeholder demands require research management and organisational learning (Hemlin
and Rasmussen, 2006). Moreover, rankings and performance indicators cause competition
over resources and reputation (Mingers and Willmott, 2013).
Planning (P)
Two decades ago, strategic research planning became an established and widely used tool
(Beerkens, 2013) to determine long-term goals (Nguyen and Van Gramberg, 2017; Chan
and Richardson, 2012; Lanskoronskis et al., 2009). Travaille and Hendriks (2010) identify
the management context of knowledge as a critical success factor for science by stressing
the adequacy of regulation. Management may be regarded as a responsibility of the entire
institution. The qualification of the group leader as a group manager, collaboration, and
7
communication through a well-defined mission statement are important factors in
enhancing productivity and reputation (Travaille and Hendriks, 2010). Hendriks and Sousa
(2013:611) stress organisational structures as a “key management domain” for fostering
academic research. Research planning should depend on the individual researcher, while
annual performance reviews facilitate evaluation (ter Bogt and Scapens, 2012).
Reward and compensation (RC)
Reward and compensation should enhance research performance and motivation (Walter
et al., 2018; Nguyen, 2016) and may influence performance (Walter et al., 2018; Duh et
al., 2014). Funding environments have to be considered in the development of incentive
systems (Auranen and Nieminen, 2010). Research budgets, bonuses, research assistants,
infrastructure, salary increases, travel subsidies, professorships and time for research and
release of teaching are mentioned, based on quantitative and qualitative indicators (Sutton
and Brown, 2016; Edgar and Geare, 2013; Sousa et al., 2010; Manning and Barrette, 2005).
Kirkland (2005) distinguishes between departmental, career and personal incentives.
Vogel and Hattke (2018) distinguish between input controls (career opportunities) and
output controls (monetary incentives). Bonuses depend on the total amount of publications
and citations (ter Bogt and Scapens, 2012; Stephan, 2008) as well as patent application
(Walter et al., 2018), serving as a clear sign of universities’ goals (Lanskoronskis et al.,
2009; Manning and Barrette, 2005). Pay-for-performance systems comprise basic salary
and bonuses (Türk, 2008), and fairness and transparency are their prerequisites (Hendrik
and Sousa, 2008; Türk, 2008; Manning and Barrette, 2005) in order to avoid deterioration
of the organisational climate because of competitiveness and conflicts (Türk, 2008).
Academics’ motivations are determined by a wider peer group, leading to less efficiency
of internal management systems (McCormack et al., 2014), while extrinsic incentives may
enhance motivation (Hendrik and Sousa, 2008).
Figure one to figure three provide an overview of the control types and their quantitative
distribution as indicated in the literature. If an article is only weighted according to one
cluster (figure one), this is listed in the specific cluster. If several categories are identified
in an article, they are subsumed under ‘several’. This graphic shows that most of the articles
address several topics. Articles concerning cybernetic controls as well as reward and
compensation are in second and third place. In figure two, the category ‘several’ has been
eliminated. Multiple naming of clusters per article was thus permitted. The weighting no
longer relates to the number of items, as in figure one, but to the total number of clusters
assigned. Cultural controls with a share of 24 %, followed by reward and compensation
and cybernetic controls, each with a share of 23 %, are the most commonly assigned
categories. Administrative controls achieved 22 %. Little information was found on the
subject of planning with an 8 % share. Figure three shows a summary of the examined
control types.
8
AC
22%
CC
24%
CYC
23%
P
8%
RC
23%
Figure 2: Content-related foci (overlapped), adapted from Schmidthuber (2019)
AC
9%CC
7%
CYC
21%
P
5%RC
16%
several
42%
Figure 1: Content-related foci, adapted from Schmidthuber (2019)
9
administrative controls
central administration vs. research offices
vice rectorate
clear division of responsibilities
communication
balance between teaching and research
"pre-/post-award"
assumption of administrative and bureaucratic tasks
infrastructure
trainings
mentoring program
international assignment
cultural controls
research management = supporter
research = independent, autonomous acting
freedom of organisation and content
research culture
exchange between researchers
"group understanding"
motivation
cybernetic controls
financial resources
system of indicators
balanced scorecard
human capital management systems
scoring system
quality systems
evaluations
planning
long-term planning
correspondence between plans and incentives
performance reviews
evaluation and assessment of targets
reward & compensation
personal support
infrastructure support
financial incentives
subsidies
promotion
partial exemption from teaching
awards
appreciation (commendation)
Figure 3: Types of MC. adapted from Schmidthuber (2019)
10
Prior work on institutional logics
Empirical research on institutional logics in the context of MCSs in higher education is
scarce. The literature search yielded 17 relevant articles.
Impact of regulations and reactions on internal (institutional or organisational) and
external demands (ten studies)
In a longitudinal case study, Aleksandrov (2020) investigated the dynamics and processes
of individual actors at a Russian university during hybridisation and revealed various forms
of reflexivity. Czarniawska (2020) analysed the global trend related to mergers and
acquisitions of higher education institutions, especially university rankings and examined
the effects on research and teaching. Guarini et al. (2020) analysed academic staff’s coping
strategies for the introduction of changing PMSs at an Italian university and found, that, as
a response to external pressure, academics change their publication strategies. Kallio et al.
(2020) investigated the acceptance of audit culture and related public sector reforms by
Finnish universities and found a shift from “professional bureaucracy” towards
“competitive bureaucracy”. Conrath-Hargreaves and Wüstemann (2019) examined a
German institution of higher education that voluntarily reorganised from a public into a
foundation university. Results show that organisational characteristics play an important
role in increasing autonomy through self-motivated reform processes. Based on participant
observations conducted at three universities, Ahrens and Khalifa (2015) investigated the
impact of accreditation on management control practices at three universities. Management
control compliance as a creative process of arranging and translating general prescriptions
into specific contexts is used as a strategic response. Pettersen (2015) analysed how two
qualification frameworks in organisations of higher education (Norwegian and Swedish)
are transformed by professional (academic) knowledge into metrics derived from
managerial logic. A combination of professional and administrative values was found.
Ezzamel et al. (2012) examined the introduction of budgeting practices in the field of
education in the UK and found that the extant logics of professionalism and governance
have remained influential. Moll and Hoque (2011) investigated how budgeting is involved
in processes of legitimation at an Australian university and found that it was undermined
by university staff because of separate and compartmentalised systems. Wagner et al.
(2011) analysed consequences of implementing a new Enterprise Resource Planning
system at an American university. Because of resistance by the management accountants,
the post-roll-out modifications have to be considered and depend on the entanglement of
users and technology.
Responses to co-existing logics in Higher Education Institutions (seven studies)
In a single case study at an English business school, Gebreiter and Hidayah (2019) found
that the juxtaposition of professional and commercial logic leads to compliance, defiance,
combination and compartmentalisation by individual academics. Dobija et al. (2019)
provide insights into four Polish universities using performance measurement systems.
Their (internal) use, depending on internal and external factors, was loosely coupled with
accountability purposes. Grossi et al. (2019) conducted a longitudinal case study at a Polish
university and investigated how shifts in logics affected performance measurement at the
organisational and individual level. Logics were found to co-exist and enter into robust
combinations. In a cross-case study of three European universities, Boitier et al. (2018)
11
assessed organisational changes induced by managerial logic in a French and two German
universities and revealed different hybrid responses in the form of segmentation and
blending. In 2017, Upton and Warshaw investigated to what extent universities display a
transformation of their core values by means of a longitudinal case study of three American
universities, finding multiple strategies of response. In a longitudinal case study at a
multidisciplinary French university, Boitier and Rivière (2016) analysed how several
dimensions of logics contribute to the specification of their compatibility and how
interactions with MCSs contribute to their institutionalisation. Canhihal et al. (2016)
conducted a large-scale survey of 26 universities in eight European countries and showed
how compatibility is achieved through the adoption of different logics: Managerial
pressure affects the adoption of managerial practices but has no significant effect on
academic aspects.
In summary, literature provides a balanced examination of different types of control with
the exception of planning. There is a strong focus on cybernetic and cultural controls as
well as on reward and compensation, showing that cultural controls play an important role
in research and organisational culture. Increasingly, the influence of MCSs and PMSs on
organisational culture is discussed (Agyemang and Broadbent, 2015; Edgar and Geare,
2013; Adler et al., 2009). While the significance of different research communities is
evident, the ways in which research management can influence research culture remain
unclear. The lack of potential consequences in case of non-fulfilment is becoming obvious.
Inside the research context of institutional logics, one quantitative study and a handful of
case-studies have either explored responses to a single event (reorganisation, accreditation,
introduction of a new framework; implementation of a new instrument) or have studied
how institutions of higher education and universities deal with the co-existence of distinct
logics. Only seven studies were identified as dealing with the higher education sector, six
of which focus on a regional case and one conducted a Europe-wide survey. No study
relates to Austrian public universities.
3. Theoretical considerations on institutional logics and MCSs
Management Control Systems as a package
As stated above, institutional logics emerge in a particular setting (Thornton et al., 2012).
Accounting practices can be regarded as expressions of specific logics. MCSs may act as
mediator (Busco et al., 2017), e.g., if performance-dependent rewards or administrative
systems support researchers’ autonomy (Sutton and Brown, 2016).
In this research, the concept of MCSs as a package (Malmi and Brown, 2008) is applied to
analyse the accounting practices by which Austrian public universities try to live up to their
core values. The typology is designed to guide employees’ behaviour intentionally (i.e., to
create goal congruence). MCSs are defined as “those systems, rules, practices, values and
other activities management put in place in order to direct employee behaviour should be
called management controls. If these are complete systems, as opposed to a simple rule
[…], then they should be called MCSs” (Malmi and Brown, 2008:290). The concept
distinguishes cultural controls, planning, cybernetic controls, reward and compensation,
and administrative controls.
12
Organisational culture is defined as “the set of values, beliefs and social norms which tend
to be shared by its [the organisation’s] members and, in turn, influence their thoughts and actions” (Flamholtz et al., 1985:158). Malmi and Brown (2008) differentiate between
value-based controls (recruiting employees, socialising to attain a fit with organisational
goals, explicated values), symbol-based controls (visible expression) and clan controls
(within individual groups). For instance, the appointment of new professors, in accordance
with universities’ mission statements, expresses universities’ belief systems. Planning is a form of control in advance and defines objectives to increase effort and direct behaviour.
Furthermore, planning serves as an expression of the level of effort and expected
behaviour, and can help achieve congruence by aligning actual practice with the goals set
in planning (e.g., performance agreements). Cybernetic controls provide the quantification
of standards to be met, which allows feedback processes, variance analyses and the
opportunity for modification (Hansen et al., 2003; Otley, 1999). Malmi and Brown (2008)
include budgets, financial and non-financial measures (Ittner and Larcker, 1998), and
hybrids (e.g., intellectual capital reports). To control the direction of effort, duration and
intensity directly, rewards (monetary and non-monetary) and compensation are used (e.g.,
performance-dependent incentives, appreciations). Organisational structure and design,
governance, policies and procedures (Simons, 1987) are controls that direct employee
behaviour through organising individuals and groups. As organisational design and
structure are governed by the Austrian state, Austrian public universities also apply
specific research management systems to gather data for the intellectual capital report.
Although some measures can be categorised as different kinds of control, i.e. training as
administrative or cultural control, provision of resources is not seen as a control instrument
but as a “prerequisite for proper work” (Malmi and Brown, 2008:295).
Multiplicity of Institutional logics and strategic responses
The notion of institutional logics, introduced by Alford and Friedland (1985), relates to
contradictory practices and beliefs inherent in institutions of societies (Thornton and
Ocasio, 2008). According to DiMaggio and Powell (1983) and Meyer and Rowan (1977)
institutional logics describe the influence of cultural regulations and cognitions on
organisational structure; furthermore, “an institutional logic informs organizational
identity and internal decision-making” (Townley, 1997). Institutions “shape individual preferences and organizational interests as well as the repertoire of behaviors by which
they may attain them. These institutions are potentially contradictory and hence make
multiple logics available to individuals and organizations. Individuals and organizations
transform the institutional relations of society by exploiting these contradictions”
(Friedland and Alford, 1991:232).
Each of the most important institutional orders has a central logic, i.e., a set of material
practices and symbolic constructions, which provides social actors with reasoning
(Thornton and Ocasio, 2008 and 1999; Haveman and Rao, 1997; Friedland and Alford,
1991). Thornton et al. (2012:149) highlight three forms of symbolic representations:
“theories, frames, and narratives”. Furthermore, Thornton et al. (2012:161) constitute
dynamism in logics at the level of institutional fields, involving “a combination of changes in narratives and practices”. Narratives reflect “specific organizing practices, their development, and their outcomes”, and “help to make sense” (Thornton et al., 2012:155).
By the means of narratives, retro- and prospective sensemaking “materializes the identities
13
and categories through which organizations and institutions come into existence”
(Thornton et al., 2012:96). Through sensemaking, institutional logics are transformed.
Initially, Friedland and Alford (1991) identified the market, the bureaucratic state,
democracy, the nuclear family and Christian religions as characteristics of societal-level
orders, each possessing a distinct institutional logic. Thornton et al. (2012:148) further
developed institutional orders at the level of institutional fields, positing that “field-level
logics are both embedded in societal-logics and subject to field-level processes that
generate distinct forms of instantiation, variation, and combination of societal logics”.
For the higher-education industry, Thornton et al. (2005) identified editorial and market
logics as ideal types, editorial logic as a variant of professional logic and market logic as
an instantiation of societal-level logics, as specific contingencies in the field lead to field-
specific variations. For universities, Boitier and Rivière (2016) identified academic logic
(decentralised, autonomous and flexible structures characterise governance structures;
clans and peers without quantification serve as control modes), political (importance of
collegiality, and control is originated from election), bureaucratic (the administrative
structure guides governance, and legal and regulatory compliance is the key type of
control) and managerial logic (characterised by decentralisation, project groups,
assessment and funding groups, while cybernetic controls, contracts, accountability and
quantification are the dominant control mechanisms). Conrath-Hargreaves and
Wüstemann (2019) identified academic, government and business logic. Academic logic,
an instantiation of the professional societal-level logic, is guided by the aim to produce
knowledge and contribute to the researchers’ own and their university’s reputation. A high degree of autonomy and reputation dependent on collegial assessment are its central
guiding principles. Government logic, a lower order logic and an instantiation of the
societal-level logic of the state, is characterised by a tight corset of regulations determined
by the government, leading to homogeneity and standardisation. Compliance with
regulations and laws are universities’ main tasks. According to business logic, an
instantiation of the societal-level of the corporation and the market, universities’ identity is linked to their perception as a business-like entity, and generating financial income is a
central strategic aim. The present research adopts the classification proposed by Conrath-
Hargreaves and Wüstemann (2019), Boitier and Rivière (2016) and Thornton et al. (2005).
Hybrid universities are characterised by institutional complexity, i.e., the number of logics
and the degree of incompatibility between them (Greenwood et al., 2011). Thornton and
Ocasio (2008) argue that there are multiple sources of rationality in the inter-institutional
system and that, therefore, contradictions between logics of different institutional orders
can arise. The need to manage contradictions raises the question as to how organisations
respond to these demands. Greenwood et al. (2011:349) emphasise that “[t]he response of
an organization to competing logics, in other words, is partly a function of how logics are
given voice within the organization; but the ability of a voice to be heard is linked to the
influence of that logic’s field-level proponents over resources - including legitimacy - that
they control”. Furthermore, Greenwood et al. (2011) stress that the sustainability of
organisational responses as well as their alteration and variability also have to be
considered in this context.
14
According to Thornton et al. (2012), resource environments (e.g., financing, competition)
affect the construction of institutional logics and are shaped by institutional logics. Hence,
exogenous changes in institutional logics, changes in resource environment but also
internal contradictions between symbolic representations may lead to evolution and change
in institutional logics (Thornton et al., 2012). In this process, theories and frames are not
entirely transmitted, but they are adapted. The same happens with imported institutional
logics: they are adapted to the institutional field. Furthermore, critical (external) events
may evoke changes in material practices and symbolic representations, provoking shifts
from one logic to another (Thornton et al., 2012).
A given organisations’ members hold different options on how to cope with competing
logics and how to handle institutional complexity. In literature, there is a wide range of
research dealing with possible coping-strategies (e.g., Oliver, 1991), ranging from ‘tight
coupling’ in the public sector in case of financial dependency (Rautiainen and Järvenpää,
2012), ‘decoupling’ by symbolically adopting rituals defined by the environment to
minimize legitimacy threats (Boxenbaum and Jonsson, 2008; Scott, 1983; Meyer and
Rowan, 1977) or ‘selective coupling’ in order to lower the risk of losing external
organisational legitimacy by satisfying symbolic concerns (Pache and Santos, 2013).
Thornton et al., 2012 identified (more radical) transformational change and developmental
change, where a majority of prevailing practices remains. Smets et al. (2015) investigated
the role of MCSs in managing dynamic tensions between competing logics and found
segmenting (i.e., separating different logics), bridging (i.e., linking coexisting logics) and
demarcating (i.e., reinforcing the different logics) as organisational responses. More
precisely, bridging is described as a coping strategy that consist of importing aspects of
one logic into situations dominated by the other: “Bridging generates complementarities between competing logics by skilfully importing pertinent aspects of one logic into the
enactment of another, as and when it appears valuable and in ways that preserve
legitimacy with representatives of both logics” (Semts et al., 2015:958). Different logics
can be combined and reconfigured to create hybrid organisational forms, logics, practices
or identities. Reconciling competing logics by combining activities from each logic is
described as a viable strategy to gain legitimacy (Pache and Santos, 2013).
4. Austrian public universities as a case study - sample description and
methodology
As stated above, the UG 2002 legally mandates Austrian public universities’ principles and
responsibilities as well as financing and university governance. To support academic
research and teaching constitutes a key principle within this act; freedom of science and
teaching is already enshrined in the constitution (State constitution on the general rights of
citizens, 2020). Furthermore, universities as legal entities under public law shall be free of
ministerial instruction and free to adopt statutes within the limits of the act (UG, 2002).
The Federal Government, considering the expected number of students and the ratio of
students per professor, funds Austrian public universities based on a three-year
performance agreement, which includes universities’ development plans as their strategic
planning instrument. The content of universities’ development plans will be based on the objectives of the Austrian National Development Plan for public universities (UG, 2002).
It serves as a basis for each university’s performance agreement with the ministry.
15
In this planning framework, each university pursues a specific research profile, promoting
some areas more than others do. Performance agreements must establish quantitative and
qualitative performance measures for specific objectives, to be included in the annual
intellectual capital report that presents the sphere of action, the intellectual capital and the
performance processes as set out in the performance agreement. This instrument led to the
introduction of so-called research information systems at universities, which collect all
relevant research efforts (e.g. publications in number and quality, scientific lectures,
research projects or scientific community services). All governance levels of universities
are affected by this measure, because it provides rectorates with a central management
system to monitor the performance of faculties, centres and individuals.
The Austrian Federal Ministry of Education, Science and Research monitors these
performance indicators continuously. As stated above, universities’ budgets are distributed according to specific indicators (e.g. the number of students who are actively taking
examinations). Furthermore, with the introduction of a new legislative act in 2020,
additional budget-relevant indicators, depending on competitive third-party funding and
the number of doctoral students in structured thesis programmes, will become relevant for
university-funding. If targets are not met, budgets will be reduced for the next period. In
order to assure quality and the attainment of objectives, every university has to develop a
quality management system. Universities’ governing bodies are the university council, the
rectorate, the rector and the senate.
To answer the research questions, a qualitative research method combined with a single
case study was applied. Given the absence of previous studies in this field, an exploratory
approach was chosen to gain new insights. Moreover, due to the limited research context,
a full census on the basis of in-depth interviews was not only feasible but the most suitable
method for answering the research questions from the perspective of university research
management (Bortz and Döring, 2016; Mayring, 2016; Hussy et al., 2013; Schnell, et al.,
2013). The interviews lasted between 60 and 90 minutes. Interviews were digitally
recorded and transcribed with permission of the interviewees (Mayring, 2015). Data
analysis was conducted by two persons using MAXQDA and supported with a
spreadsheet-program; categories were derived by means of deduction and induction. The
aim of the investigation was a full census of all 22 Austrian public universities. Due to
random acceptance, 15 semi-structured in-depth interviews with 17 experts from 14
universities were conducted (Bortz and Döring, 2016); the vast majority of these were key
personnel, i.e. the vice-rector for research (Dai et al., 2016; Guest et al., 2006).
5. Data analysis and findings
Characteristics and universities’ logics
Figure four displays the guiding institutional logics and the MCSs implemented and
applied at Austrian public universities. The qualitative analysis inductively identified the
‘core values’ (fundamental beliefs and guiding principles concerning universities’ self-
concept, understanding of control as well as the planning process and the source of
legitimacy) and three different ‘levels of control’ (global, institutional and individual). The
global level affects universities’ strategic aims concerning research profile as set out in the
development plan. On the institutional level, targets are agreed and resources are
16
distributed between the rectorate and faculties, departments, institutes or centres. On the
individual level, resources are allocated between rectorate, faculties, departments,
institutes or centres and researchers. Subsequently, the derived types of control according
to Malmi and Brown (2008) are assigned to the three levels of control:
17
sensemaking
Institutional
Logics ACADEMIC LOGIC GOVERNMENT LOGIC BUSINESS LOGIC
Core Values
Academic freedom in research and
teaching with a maximum of autonomy on
the highest international level
Achievement of economic and social goals
defined by the state
The university as a business, market
orientation, efficient goal achievement
Maintaining motivation by support,
provision of resources as well as good
conditions
Compliance with laws and regulations
Performance and competition,
(international) positioning in the research
community
Autonomy and decentral decision making,
research cooperation to build profile
Administrative structures (ministry,
rectorate, units)
Research (cooperation) to enhance
competitiveness and positioning within the
international scientific community
Reputation as a research university on the
highest international level
Fulfilment of political and economic
interests of the ministry
Positioning of the university in a highly
competitive international research
environment
Global-level
control types
Planning, Administrative controls,
Cultural controls, Provision of resources,
Cybernetic controls
Planning, Cybernetic controls,
Administrative controls
Administrative controls,
Cybernetic controls
Institutional-level
control types Planning, Cybernetic controls, Administrative controls, Reward and Compensation, Provision of resources
Individual-level
control types Planning, Cybernetic controls, Reward and Compensation, Administrative controls, Provision of resources
Figure 4: Institutional logics und MCSs at Austrian public universities, adapted from Conrath-Hargreaves and Wüstemann (2019), Boitier and Rivière (2016), Thornton et al. (2005)
18
What are the guiding institutional logics at Austrian public universities? (RQ 1)
Content analysis confirmed the co-existence of three salient logics based on Conrath-
Hargreaves and Wüstemann (2019). Similar to findings reported by Conrath-Hargreaves
and Wüstemann (2019), Austrian public universities exhibit strong competition and partial
contradictions between grown institutional logics, as will be shown.
Findings indicate that the academic logic is the most advocated in the interviews. In their
self-concept, representatives of Austrian public universities stress academic freedom in
research and teaching with a maximum of autonomy at the highest international level.
Universities’ research reputation (including basic research) and maintaining ethical
standards plays the most significant role, e.g., “freedom of science is paramount” (I 6),
“ethical standards and rules must be respected” (one interviewee). Generally, the vast
majority of the interviewees reject the controllability of research performance, e.g.,
“university is not a ballpoint-factory” (I 3), “it is not like this, only what you can measure, you can govern” (I 7). Reliance on high personal and individual responsibility guides the
research strategy. An understanding of control as expressed by support and provision of
resources is shared, e.g., “not extinguishing the fire of intrinsic motivation” (I 7), results
have to be monitored, if deviations are recognised, possibly goals have to be redefined
(one interviewee). Universities’ targets should be achieved by decentral and consensual decision-making, e.g., I 13: “research topics are always defined bottom-up and we try to
build the right structure to make that possible”.
However, government logic strongly guides the control system. Austrian public
universities strive to fulfil the political and economic interests of the state and try to meet
the economic and social goals defined in the performance agreement, as is clearly
expressed in the following statement: “we will adjust the research profile to the
performance agreement” (I 6). A prioritisation of governmental goals is accompanied by
a narrow understanding of control, e.g., “key figures of the formula-bound budget have to
be met; therefore research control is very important; legally required indicators will
improve research performance” (one interviewee). The planning process is characterised
by administrative structures where key figures set by the ministry are communicated top-
down, as I 12 states: “we have a system based on the key figures of the intellectual capital
report, where the performance agreement goals are broken down to the individual
departments”.
Moreover, high-impact research and being successful in securing grants is dominantly
guided by business logic. Austrian public universities try to position themselves primarily
as (inter)national research universities, market-oriented and competitive with efficient goal
achievement striving for financial income, achieved by the acquisition of high-grade
competitive research grants, e.g., “what we want to achieve is a maximum of visibility of
the university in the international research area” (I 8).
Which MCSs are applied at Austrian public universities in the area of research
management? (RQ 2)
According to figure four, the selection and application of management control types at
Austrian public universities depends on the level of control considered. Therefore, the
control types examined were assigned to the identified levels and, are named according to
the frequency of mention. In addition, content analysis revealed, that at the global level of
19
control, the application of control types depends on the institutional logics confirmed. This
also applies to the institutional level, albeit not mentioned explicitly. At the individual level
of control, no particular logic guides the implementation and application of specific control
types. Rather, at this level of control, various types are applied and argued from various
perspectives.
Global-level control types
Guided by academic logic in order to fulfil university’s specific mission, the most
frequently applied control type is planning (profile building and development planning)
followed by and intertwined with administrative (by establishing interdisciplinary research
areas) and cultural controls (appointment and application of professors). The vast majority
of the interviewees stress these control types, as the following examples show:
“strengthening interdisciplinary research fields” (one interviewee), “establishing
research foci” (I 13), “appointment and application of new professors” (I 8). The
provision of resources is a central aspect of supporting research efforts directly, as
mentioned by I 8: “funding of research infrastructure and funding appliances”. To a lesser
degree, cybernetic controls in the form of budgets and peer-reviews (in case of
appointments) exist on this level of control: “optional budgets for promoting research
directly” (I 8), “peer-evaluation and clan controls accompanied by the advisory council”
(I 12). Reward and compensation are of no importance.
Led by government logic, planning instruments (by concluding performance agreements
with the ministry) interlinked with the deployment of cybernetic controls (budgets and
(non-)financial indicators) and administrative controls (monitoring and reporting key
figures in the intellectual capital report) are applied by Austrian public universities, as I 8
expressed: “governmental budget-relevant indicators are deployed by the university”.
Other control types have no relevance at the global level of control. Entrepreneurship
becomes increasingly visible by stressing the amount of external (highly competitive)
funds and contracts raised, which should be achieved by establishing research foci,
collaborations and networking among national and international scientists.
From the perspective of business logic, the mostly applied control type is administrative
followed, to a lesser extent, by cybernetic, e.g., I 13 stated “development of research foci
to become a world leader in specific research fields”. Using indicators, Austrian public
universities’ success in the acquisition of highly competitive third-party funds or research
grant competitions is measured by the research management system: “quantitative output
indicators and metrics (projects, collaborations and publications) for funding research
projects and for the acquisition of (high-grade) research grants” (I 8). Cultural controls,
planning instruments, and reward and compensation are not mentioned.
Institutional-level control types
At the institutional level of control, government logic strongly guides the employed control
types. Planning in the form of target and qualification agreements between the rectorate
and the units are the most frequently applied controls, as the following quotation shows
exemplarily: “[the] rectorate periodically agrees specific targets (teaching, research and
personnel) derived from universities’ development plan and the performance agreement
with their faculties and organisational units” (I 1). These are closely intertwined with
cybernetic and administrative controls, particularly by the setting and monitoring of
20
indicators, e.g., “evaluation is based on a broad set of quantitative and qualitative
indicators” (I 3); “internal and external (national and international) benchmarks are
applied” (I 7); “assessment is done periodically” (I 2). Furthermore, a wide variety of
different budgets is applied, as the following quotations show: “budgets dependent on master data (personnel, students and facilities)” (I 6, I 8), “variable ministerial budgets
(according to the need of investments in teaching and fundamental research” (I 2),
“performance-dependent budgets - on excellence of applications (external peer-reviewed)
- or budgets distributed for projects to support interdisciplinary research by alliances and
to enable networking” (I 12). Performance reviews, the recruitment of personnel, meetings
and initiatives across units are also applied, e.g., “appointment of tenure track professors”
(I 12), “doctoral schools across departments” (one interviewee). At this level of control,
incentives gain importance: “‘overhead incentives’ [certain percentage of project funding
to support expenses such as administrative costs] are sometimes removed to the rectorate”
(I 5) in other cases “they remain (partly, (one interviewee)) at the faculty or institute or at
the department” (I 2, I 13). Additionally, administrative controls together with
infrastructure support are mentioned: “project database” (I 13), “formal structures
(policies and procedures for appointing professors” (I 5) or “designing curricula and
support for third-party funding and legal certainty” (I 4), “networking-symposia and
doctoral colleges” (I 12). Cultural controls could not be identified at the institutional level
of control.
Individual-level control types
At the individual level of control, planning instruments (target and qualification
agreements) interlinked with cybernetic controls (quantitative and qualitative measures,
internal and external benchmarks) and subsequent evaluation (periodical evaluation
instruments) are the most frequently applied control types, as the majority of the
interviewees mentioned: “target and qualification agreements, (partially) based on
indicators of the intellectual capital report (e.g., concerning the amount of (high-impact)
publications, co-authorship, monographs, high competitive third-party funding, peer-
reviews)”. In addition, budgets as incentives are deployed at the individual level of control,
e.g., I 7: “budgets for good performance in publishing or third-party funding […] budgets
for special (innovative, interdisciplinary) research projects”. Furthermore, a wide range
of reward and compensation (monetary and non-monetary incentives) are important
controls at the individual level (e.g., qualification agreements or boni for highly
competitive third-party funding, removal of time limits for approval, sabbaticals,
appreciation in the form of mentions in newspapers or on the university’s website, and
even individual financial incentives for publications) as the following examples illustrate:
“removal of the time limit for approval (e.g., tenure track positions)” (I 6), “monetary
incentives as variable salary components dependent on specific indicators” (I 13),
“possibility for salary increase in case of positive evaluation, bonus systems for successful
project applications” (also for private use - I 3). Administrative controls (databases,
policies and procedures or coordination units) together with the provision of resources in
the form of infrastructure support (e.g., core facilities or offices for research funding) are
used. Placement, trainings and contracts are deployed, e.g., “recruitment of tenure track professors” (I 8) or “doctoral students” (I 5), “mobility and mentoring programmes for young scientists” (I 6), “personalised coaching, if positive evaluated project applications are rejected” (I 1). The provision of resources constitutes an important support: “subsidies
for publishing and conferences, research applications, absorption of translations costs,
support to foster networking and interpersonal exchange (internal interdisciplinary
21
meeting once a year) to gain know-how, absorption of seminar/travel costs” (I 4). In case
of deviations, corresponding measures are agreed increasingly (I 8), peer reviews and
external consulting are applied (I 6). Non-fulfilment (e.g., if a doctoral thesis is not
finished) in some cases leads to job vacancies not being filled (one interviewee), to a
reduction in personnel and salary (I 2), and no removal of time limits, if qualification
agreements are not met (I 7).
The in-depth analysis revealed that, from the global level down to the institutional level,
the application of MCSs changes from a guidance by academic logic to government logic.
Furthermore, reward and compensation gain importance. At every level, planning is
applied ranging from profile-building instruments, development planning and the
ministerial performance agreement to target agreements with the units and individual
qualification agreements. Administration and provision of resources constitutes a key
prerequisite. More and more strongly, corresponding measures are applied in case of
deviation: these range from peer reviews and external consulting to reduction in personnel
and salary, but may also result in not filling job vacancies or not removing the time limit
for approval.
How do Austrian public universities cope with the existence of (competing) logics in the
application of MCSs? (RQ3)
Content analysis revealed four types of coping strategies; in particular, Austrian public
universities cope differently with the pressure arisen from governmental regulations (table
one). Key personnel has to bridge universities core values and governmental requirements,
concurrently, universities have to maintain and enhance their competitiveness. First,
interviewees demonstrate their disagreement as I 3 describes the performance agreement
as “a conglomeration of pseudo-tasks and as a waste of resources” and emphasises that
“university is not a ballpoint-factory”, though controls are not decoupled from the
governmental prescribed. A second coping strategy is expressed by the adaption of
governmental guidelines on the global level of control, as I 8 expressed: “we try to adjust
the research profile to the performance agreement”. A third coping strategy concerns the
translation of agreements in the intellectual capital report into measurable objectives
communicated to the individual units, while simultaneously highlighting the importance
of intrinsic motivation (I 13). After all, some interviewees demonstrate a clear commitment
to the requirements issued by the government, as one interviewee mentioned exemplarily:
“key figures of the formula-bound budget have to be met; therefore research control is
very important”.
Universities’ coping strategies
Exemplary quotations translated from German
Disagreement
AL: researchers see themselves as highly creative people […] they need one thing and that is a certain form of freedom and the ability to do what they want GL: the ministry
gives us requirements and university has to meet it […] maybe in the medium term I will
inhibit performance […] maybe someone who does something really great, innovative, disruptive, may not get his publications published in the journal […] it is hardly about the core tasks of the university BL: we have to be internationally competitive, we want
to collaborate (I 3)
Adaption on a
global level
AL: no scientist is supported or not supported if he pursues a certain research topic or
direction […] but from a management and a public perspective, our strengths interest us GL: our budget will be dependent on the acquisition of third-party funding and the
amount of doctoral students in structured doctoral programs; university 8 tries to adapt
research profile to the performance agreement BL: to be recognized internationally as
a research university at the highest level […] by encouraging scientists to present themselves as qualitatively and internationally visible as possible (I 8)
22
Application as
university-internal
control instrument
AL: research control works very strongly through the motivation of the employees and
on an upper level through our research focus system […] research topics are always
given bottom up, not always but 99 % of the time and we try to build the right structure
to make this possible GL: there is a legal requirement to make an intellectual capital
report […] from this obligation certain systems have developed […] certain objectives,
which can be derived from the development plan and the performance agreement, are
communicated to the faculties and from the faculties to the institutes and, ideally, also
to the individual employees BL: when someone applies for an ERC grant, automatically
a qualification agreement position is offered (I 13)
Application as
university-guiding
control instrument
GL: we have a system based on key figures from the intellectual capital report […] we
break down the performance agreement […] to the individual departments and institute
or […] heads […] there are specific goals which are then assessed in the annual
discussions or on the basis of the key figures in the published intellectual capital report
and then reflected with the people with whom we have agreed them; in some cases,
salary components are linked to these performance agreements BL: we try to reward
those projects that are more competitive (I 12)
Beyond, interviewees try to make sense between the logics identified. Experts seek to
reconcile elements of one logic with elements of another, as the following quotations show
(table two): the consensus between government and academic logic is sought most
strongly, followed by academic and business logic, and, government and business logic.
Exemplary quotations translated from German
Government
logic
Academic
logic
we rely heavily on financial and non-financial indicators […] the art herein is to define a street or a corridor where you can clearly identify, that is the one in which you can move and
those are the rules […] (I 3) research control is not a good term […] we talk about research custody […] we also control, we also use output- and input-oriented dimensions, of course […] at some faculties, budget
allocation depends on performance indicators […] we have a de facto budget penalty (I 5)
it is clear MCSs are increasingly effective […] this is neo-liberalisation of the universities
[…] that is the international trend and it’s hard to resist and in Austria we have an increasing grip of the UG, at the beginning I felt barriers, in the meantime that has subsided […] it’s about a balancing act; that must be interlinked; performance indicators of the performance
agreement are communicated top-down; it would be a lie to say it doesn’t exist (I 7)
Academic
logic
Government
logic
visibility and appreciation are very important, besides the point system (I 3)
we are not talking about MCSs we talk about support systems […] we have a more positive
approach, not a controlling one […] certain processes are standardised […] everything that goes beyond - absolute freedom of research has priority […] you always have to look between these poles where is it also possible […] the aim is not to specify key figures, our aim is to
increase or to maintain stability […] hard key figures contradict universities’ autonomy and may impede potentials (I 4)
we have to be sensitive to the research culture (I 5)
Academic
logic
Business
logic
we know that the standing of our scientists in the international community is extremely high
[…] we are doing everything we can to support the key people to maintain this (I 4) our aim is increase in visibility, ability to cooperate and competitiveness of the research
performance and scientists of our university in the international scientific communities […] do what you are interested in but it should be excellent […] high appreciation of successful third-party finding in highly competitive funding projects […] we can communicate the
meaningfulness of the goals and create attractive offers (I 5)
one the one hand to produce excellent internationally outstanding research – on the other
hand freedom of science is always in the foreground, these two poles have to be reconciled
[…] there are certain areas where key figures have to be met, but if not, nothing happens (I 6)
Government
logic
Business
logic
concerning indicators, it is important to bring competitive funding to the university (I 1)
we have a management information system for the rectorate […] we look how many third-
party funds do people raise […] for raising third-party funding we use quantitative indicators
[…] we want to achieve a maximum of visibility (I 8)
Table 1: Universities’ coping strategies
23
6. Discussion, contribution and research limitation
At Austrian public universities, given their historical academic tradition, academic
freedom is more than just lip service. At the global level, research control is clearly guided
by academic logic (RQ 1). Of course, universities have to adhere to government mandates,
but the actual extent of implementation and the university-internal fine-tuning of
ministerial requirements differs between the universities studied here. NPM requirements
forced Austrian public universities into a situation where they face national and
international competition. Intellectual capital reports were implemented very quickly.
Since then, there have been a number of further acts and regulations and, with the
introduction of a recent legislative act in 2020, additional budget-relevant indicators will
become relevant for university funding. Financing and competition have contributed to the
emergence of government and business logic in a long-term process and have transformed
Austrian public universities into hybrids. Consequently, this led to a change in traditional
material practices in academia, and the imported logics induced a shift between the
identified logics (Busco et al., 2017; Dai et al., 2016; Thornton et al., 2012). For instance,
Austrian public universities deny controllability of research by performance metrics, but
indicators and rankings are, in fact, employed for university-internal purposes, sometimes
even in a more sophisticated fashion than required by law.
Government and business logic, expressed by explicit indicators (e.g., indicators for high-
impact research and highly competitive research funding), as well as their practices were
adapted for internal purposes, leading to hybrid practices (Thornton et al., 2012). However,
the imported practices, shaped by academic logic, are not accepted without contradiction.
That is why universities’ coping strategies differ in the extent of the university-internal
implementation and in their efforts in making sense to facilitate resistance and assimilation
concurrently (Townley, 1997). These results are also confirmed by earlier studies,
predominantly analysing commercial and professional logic (e.g., Murray, 2010; Swan et
al., 2010; Townley, 1997). Results can also be interpreted in light of academic tradition:
Grossi et al. (2019) found the co-existence of potentially competing logics but argue, inter
alia, with a strong historical focus on commercial activities due to the private nature of the
university they examined. Finally, compartmentalisation (Canhihal et al., 2016) was found
with no significant effect on academic aspects (e.g., teaching and research). The authors
argue that “useful counterbalances help to avoid the negative consequences of
managerialism by taking into account the specific characteristics of the field” (Canhihal
et al., 2016:191). Regarding the Austrian case, our interviewees strive to find a consensus
by establishing a common language.
Regarding RQ 2 at the global level of control, the control mechanism perceived as the
strongest and most powerful is an entanglement of planning, administrative and cultural
controls; at the institutional level, planning, cybernetic and cultural controls are
intertwined. The strong commitment to budgets as well as (non-)financial and hybrid
measures indicates practices of an efficiency- and result-oriented culture (Boitier and
Rivière, 2016). At the individual level, planning, a wide variety of cybernetic controls as
well as reward and compensation instruments and administrative controls are evident. At
Table 2: Sensemaking of interviewees
24
all levels of control, the provision of resources is strongly emphasised. The applied control
instruments differ only marginally between the universities examined and, as a whole,
show a very compact and highly differentiated set of controls. Differences concern the
design of cybernetic and administrative controls as well as reward and compensation. For
instance, some universities have a highly differentiated system of key figures, differently
elaborated systems of research management or individual financial incentives.
Contrary to the results of the literature review, planning instruments play a central role in
Austria. In accordance with literature, cybernetic controls are seen critically, and there is
awareness that organisational culture is the strongest driver of employees’ motivation,
which has to be supported by the provision of resources, administrative controls (e.g.
supporting networking) and collegial support (Tucker and Tilt, 2019; Sutton and Brown,
2016; Edgar and Geare, 2013). The literature review showed a lack of potential
consequences in case of non-fulfilment. In the Austrian case, however, sanctions are
becoming increasingly established on the part of the ministry and the university
management.
In their developmental change (Thornton et al., 2010), Austrian public universities
integrate new practices into the prevalent academic logic. Elements are not only combined,
as the core elements of the academic logic prevail (RQ 3) and result in hybrid practices.
Austrian public universities uphold their core values and are simultaneously proud of their
elaborate key figure systems. They combine narratives and practices to create consensus
by creating hybrid practices and identities. The applied control instruments should act as
mediator (Busco et al., 2017). Corresponding coping strategies range from acknowledged
disagreement with governmental obligations to adoption on the holistic level of control,
application by adapting governmental control instruments for university-internal purposes,
and application as university-internal control instruments. Practices of the external logics
are made part of the academic logic. By means of “explicit accounts” (Thornton et al.,
2012), Austrian public universities are mediating within their own institutional
development and trying to find a consensus: “it’s about a balancing act”.
This study contributes to research on MCSs and institutional logics at public universities
in the context of institutional complexity. First, the coexistence of academic, government
and business logics was confirmed in a self-governing setting highly exposed to
governmental regulations. Second, while literature focuses equally on different types of
control, whereas planning instruments are rarely discussed, this study conceptualises
MCSs as a package (Malmi and Brown, 2008). Third, this study contributes to the
literature, extending previous research by drawing on the perspective of institutional logics
to facilitate the understanding of public universities’ coping strategies when implementing
and applying MCSs exposed to this regulated and competitive institutional environment.
Four types of coping strategies could be observed. Actors try to make sense and find a
consensus by assimilating and incorporating elements, practices and symbols of the
identified external logics into academic logic.
A major limitation of the study relates to the small number of public universities in Austria
(22 universities). Furthermore, the study focused only on research; consequently, teaching
and third mission are not considered. The efficiency and effectivity of MCSs are also not
examined. To analyse the impact of the implementation of MCSs, future research should
25
include longitudinal studies and integrate the perspective of the affected researchers.
Furthermore, the interaction between different types of control, also outside the scope of
this paper, would be well worth investigating. As this study considers MCSs as a package,
the interplay between the different control types and levels of controls is not regarded. It
would be interesting to study whether cybernetic (legally required) indicators or
competition (because of limited resources) actually undermine researchers’ intrinsic
motivation or, more specifically, whether or not universities are, in fact, ‘ballpoint
factories’. Furthermore, the mutual reinforcement of commonly seen conflicting logics at
Austrian public universities (e.g., academic and business logics) offers an interesting field
of research (Guarini et al., 2020).
26
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Appendix 4
Publication list
Frei, J., Greiling, D. and Schmidthuber, J. (2020), “Management Control Systems in hybrid universities – The case of Austrian public universities”, Qualitative Research in Accounting and Management (major revision).
Frei, J., Greiling, D. and Schmidthuber, J. (2020), „Management Control Systeme zur
Forschungssteuerung an österreichischen öffentlichen Universitäten“, Hochschulmanagement - Zeitschrift für die Leitung, Entwicklung und Selbstverwaltung von Hochschulen und Wissenschaftseinrichtungen, Vol. 15 No. 4, pp. 123-129.
Frei, J., Lubinger, M. and Greiling, D. (2020), Assessing Universities’ Global Reporting
Initiative G4 Sustainability Reports in Concurrence with Stakeholder Inclusiveness, in Manes-Rossi, F. and Orelli, R.L. (Eds.), New Trends In Public Sector Reporting – Integrated Reporting and Beyond, Public Sector Financial Management, Palgrave Macmillan, Switzerland, pp. 35-56.
Frei, J., Lubinger, M. and Slacik, J. (2020), Kostenmanagement – Einführung, 2nd Edition,
Linde, Wien. Lubinger, M., Frei, J. and Greiling, D. (2019), “Assessing the materiality of university G4-
sustainability reports”, Journal of Public Budgeting, Accounting & Financial Management, Vol. 31 No. 3, pp. 364-391.
Frei, J. and Riezinger, M. (2014), Kostenmanagement – Einführung anhand eines
Modellunternehmens, Linde, Wien.
Conference list
Research Forum at the Virtual Annual Congress of the European Accounting Association (May
2021) - accepted
Journal of Management and Governance and SIDREA (Società Italiana dei Docenti di
Ragioneria e di Economia Aziendale) Virtual Workshop (November 2020, Naples)
Research Forum at the 43rd Annual Congress of the European Accounting Association
(May 2020, Bucharest) - accepted
22nd Workshop „Hochschulmanagement“ (February 2020, Vienna)
EURAM (June 2019, Lisboa)
Research Forum at the 41st Annual Congress of the European Accounting Association
(June 2018, Milan)
AAAJ Special Workshop (May 2017, Warsaw)