Essential Micro-foundations for Contemporary Business Operations: Top Management Tangible Competencies, Relationship-based Business Networks and Environmental Sustainability

Akhtar, Pervaiz; Khan, Zaheer; Frynas, Jędrzej George; Tse, Ying Kei and Rao-Nicholson, Rekha (2018). Essential Micro-foundations for Contemporary Business Operations: Top Management Tangible Competencies, Relationship-based Business Networks and Environmental Sustainability. British Journal of Management, 29(1) pp. 43–62.

DOI: https://doi.org/10.1111/1467-8551.12233

Abstract

Although various studies have emphasized linkages between firm competencies, networks and sustainability at organizational level, the links between top management tangible competencies (e.g., contemporary relevant quantitative-focused education such as big data analytics and data-driven applications linked with the internet of things, relevant experience and analytical business applications), relationship-based business networks (RBNs) and environmental sustainability have not been well established at micro-level, and there is a literature gap in terms of investigating these relationships. This study examines these links based on the unique data collected from 175 top management representatives (chief executive officers and managing directors) working in food import and export firms headquartered in the UK and New Zealand. Our results from structural equation modelling indicate that top management tangible competencies (TMTCs) are the key determinants for building RBNs, mediating the correlation between TMTCs and environmental sustainability. Directly, the competencies also play a vital role towards environmental practices. The findings further depict that relationship-oriented firms perform better compared to those which focus less on such networks. Consequently, our findings provide a deeper understanding of the micro-foundations of environmental sustainability based on TMTCs rooted in the resource-based view and RBNs entrenched in the social network theory. We discuss the theoretical and practical implications of our findings, and we provide suggestions for future research.

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