[Note: This is the 31st post in our “Papers in Brief” series. This series offers a special service as it explains the core ideas of chosen research papers in a nutshell.]
Papers in Brief (XXXI) by Tobias Froese
Froese, T., Richter, M., Hofmann, F., Lüdeke-Freund, F., 2023. Degrowth-oriented organisational value creation: A systematic literature review of case studies. Ecological Economics 207, 107765. https://doi.org/10.1016/j.ecolecon.2023.107765.
Free download until 8th April 2023.Preview on ResearchGate.
Background and relevance
At the “First International Conference on Economic De-growth for Ecological Sustainability and Social Equity” in 2008 in Paris, degrowth was defined as a “voluntary transition to a just, participatory, and ecologically sustainable society” (Degrowth & Research, 2010: 524). Accordingly, those who advocate for degrowth stress the need for significant societal transformations to address the ecological and social challenges we face today (e.g., Buch-Hansen, 2014; Büchs and Koch, 2019; Demaria et al., 2013).
The profound socio-economic transformations that the notion of degrowth implies essentially relate to how value is understood and created by organizations (cf., Kallis, 2018; Leonardi, 2019). In line with this, Graeber (2013, 222) argues that “value will necessarily be a key issue if we see social worlds not just as a collection of persons and things but rather as a project of mutual creation, as something collectively made and remade.”
At the level of organizations, research on strategic management, marketing, and (sustainable) business models classically deal with issues of organizational value creation. However, the concepts offered here are not degrowth-aligned but rather pro-growth – i.e., oriented towards profitably adding and circulating ever more products and services in socio-economic systems. Moreover, our review of the degrowth literature that touches on the topic of organizational value creation (e.g., Hankammer et al., 2021; Khmara and Kronenberg, 2018; Nesterova, 2020) revealed a critical gap: A positive theory of what it means for organizations to create value from a degrowth-oriented perspective is lacking.
Against this backdrop, the study’s goal was to provide practical and theoretical insights into degrowth-oriented organizational value creation. To be explicit, the guiding research question is: How can organisations engage in degrowth-oriented organisational value creation?
The authors engage in an integrative literature review for the purpose of theory building (Snyder, 2019). Existing case studies of organisations related to degrowth, respectively post-growth, have been systematically selected using Ebsco (Business Source Complete) and Web of Science: Core Collection. The identified literature was then analysed using the notion of organizational value creation patterns in a coding process. This allowed for capturing proven solutions to problems in a uniform format (Lüdeke-Freund et al., 2018).
To be explicit, the authors utilize the conception that value is created when degrowth-oriented stakeholders perceive that organizational activities adequately address problematic situations. It is assumed that stakeholders who prioritize degrowth share and apply fundamental values of degrowth, which include ecological sustainability, local and global equality, and conviviality and participation, in such evaluations. This broad and flexible interpretation of degrowth-oriented value creation enabled the authors to inductively identify thirty-nine patterns of degrowth-oriented organizational value creation.
Correspondingly, and following the approach introduced by Lüdeke-Freund et al. (2018), the thirty-nine patterns were first organised into seven pattern groups based on the key themes depicted in their solution descriptions. Subsequently, the authors evaluated all the patterns against a triangle representing the three fundamental values of degrowth. This mapping procedure followed a two-step Delphi method, in which the team of authors first evaluated the patterns individually and then reviewed their group outcomes collaboratively.
The study’s key result is a collection of 39 patterns that demonstrate how organizations can effectively implement the essential values of degrowth in their value-creating activities. To be precise, the analyses resulted in seven pattern groups into each of which 3 to 9 degrowth-oriented patterns of organisational value creation are classified (see Table 1 below).
|G1: Overcoming economic growth dynamics||P1.1: Real cost pricing|
P1.2: Investing in efficiency gains without growth motives
P1.3: Balancing the organisational scale
P1.4: Interlocking multiple parties’ statutes for a purpose
P1.5: Marketing a specialisation in sustainability
P1.6: Building personal customer relationships
P1.7: Using alternative and sustainability-oriented currencies
|G2: Engaging consumers in sufficiency-oriented prosumption||P2.1: Sharing risks and responsibilities with consumers|
P2.2: Supporting co-production and prosumption
P2.3: Engaging consumers in packaging reuse
P2.4: Promoting sustainability-oriented learning and engagement
P2.5: Communicating for sufficiency
|G3: Joining forces in rewarding and mutual collaboration||P3.1: Practicing a culture of reciprocal care|
P3.2: Doing business in local actor networks
P3.3: Engaging in values-based business relations
P3.4: Distributing through a cooperative sales network
P3.5: Joining forces in mission-driven networks
|G4: Equalising inequalities||P4.1: Redistributing profits|
P4.3: Mobilising non-market resources and support
P4.4: Paying uniform, fair, and needs-oriented salaries
P4.5: Tailoring offers for disadvantaged groups
|G5: Open and decentral creativity||P5.1: Sharing and developing knowledge openly|
P5.2: Utilising commons-based licences
P5.3: Offering convivial products
|G6: Shrinking, slowing, and extending resource cycles||P6.1: Providing demand-reduction services|
P6.2: Providing products as a service
P6.3: Providing services for shared product use
P6.4: Providing repair services
P6.6: Promoting second-hand and reuse
P6.7: Collecting and salvaging used products
P6.8: Creating circular products
P6.9: Utilising traditional and eco-friendly means of production
|G7: Democratic, purpose-driven, and transparent governance||P7.1: Accounting transparently and purpose-oriented|
P7.2: Practicing democratic and inclusive governance
P7.3: Governing with stakeholder representatives
P7.4: Purpose-driven funding and co-ownership
P7.5: Setting and communicating a common purpose
Table 2 exemplarily presents one pattern of degrowth-oriented organizational value creation in its full length.
|Pattern||Contextual Problem||Solution||Example||Key Sources|
|P1.1: Real cost pricing||In the context of economic competition and consumerism, there is a tendency to offer products at competitive prices while not internalising high social and environmental standards and costs.||Accounting for, pricing in, and making transparent the genuine costs of high environmental and social standards (while refraining from pricing in profit margins) in order to create and communicate a credible price-performance ratio and finance high sustainability standards in production and supply.||The Artisans Association of Coffee Farmers of Rio Intag is a coffee association with around 150-member families in Ecuador. The association has started to produce and market hand-made, artisanal products made of high-quality natural materials. The association is engaged in communicating that their premium prices represent no more than their actual and fair costs.||Bloemmen et al., 2015; Bocken et al., 2020; Chassagne & Everingham, 2019; Ertör-Akyazi, 2020; Gerber & Gerber, 2017; Hankammer et al., 2021; Schmid, 2021|
Last but not least, the authors were able to derive one theoretical proposition per pattern group. For example, building on the patterns in group 7 we learn that “Degrowth-oriented value creation means that – through democratic, purpose-driven, and transparent decision-making, valuation, and communication – people are engaged to recognise economic activities as deeply political, appreciate open discussion and consensus-building, link organisational success to a socio-ecological purpose, and assume responsibility.” In combination, the seven propositions are highly informative and can facilitate the future development of a degrowth theory of value.
Moreover, the study reveals that leading organizations are actively involved in creating value in ways that align with the core values of degrowth. Consequently, the developed collection of patterns that can serve as a toolbox for practitioners seeking to align their organizational activity with degrowth values. Nevertheless, the authors clarify that the collection of patterns is not claiming to be complete but invite further research to confirm, refute, enhance, or add to the existing patterns.
In conclusion, the study provides evidence that degrowth does indeed challenge the conventional value creation logic of modern economies. Overall, corresponding organizational processes oftentimes prioritize conviviality and participation, which in turn radiate towards ecological sustainability and local to global equality. Accordingly, the thirty-nine degrowth-oriented organizational value creation patterns identified in the study offer insights and inspiration for organizational innovation, and lead to generalizable propositions about degrowth-oriented value creation processes and outcomes. Finally, the research indicates the current state of the degrowth concept’s development within organizations and highlights various starting points for future research.
Buch-Hansen, H., 2014. Capitalist diversity and de-growth trajectories to steady-state economies. Ecological Economics 106, 167–173. https://doi.org/10.1016/j.ecolecon.2014.07.030.
Büchs, M., Koch, M., 2019. Challenges for the degrowth transition: The debate about wellbeing. Futures 105, 155–165. https://doi.org/10.1016/j.futures.2018.09.002.
Demaria, F., Schneider, F., Sekulova, F., Martinez-Alier, J., 2013. What is Degrowth? From an Activist Slogan to a Social Movement. environ values 22, 191–215. https://doi.org/10.3197/096327113X13581561725194.
Hankammer, S., Kleer, R., Mühl, L., Euler, J., 2021. Principles for organizations striving for sustainable degrowth: Framework development and application to four B Corps. Journal of Cleaner Production 300, 1–20. https://doi.org/10.1016/j.jclepro.2021.126818.
Kallis, G., 2018. Degrowth. Agenda Publishing, Newcastle upon Tyne.
Khmara, Y., Kronenberg, J., 2018. Degrowth in business: An oxymoron or a viable business model for sustainability? Journal of Cleaner Production 177, 721–731. https://doi.org/10.1016/j.jclepro.2017.12.182.
Leonardi, E., 2019. Bringing Class Analysis Back in: Assessing the Transformation of the Value-Nature Nexus to Strengthen the Connection Between Degrowth and Environmental Justice. Ecological Economics 156, 83–90. https://doi.org/10.1016/j.ecolecon.2018.09.012.
Lüdeke-Freund, F., Carroux, S., Joyce, A., Massa, L., Breuer, H., 2018. The sustainable business model pattern taxonomy—45 patterns to support sustainability-oriented business model innovation. Sustainable Production and Consumption 15, 145–162. https://doi.org/10.1016/j.spc.2018.06.004.
Nesterova, I., 2020. Degrowth business framework: Implications for sustainable development. Journal of Cleaner Production 262, 1–10. https://doi.org/10.1016/j.jclepro.2020.121382.
Snyder, H., 2019. Literature review as a research methodology: An overview and guidelines. Journal of Business Research 104, 333–339. https://doi.org/10.1016/j.jbusres.2019.07.039.