Sustainability and Stakeholders: Tensions and Balances

Copenhagen Business School via Coursera

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Overview

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Many companies struggle to manage corporate sustainability effectively. Some overstate their ambitions, engaging in greenwashing, while others treat sustainability as a peripheral add-on disconnected from core operations. Initiatives may lack employee support or fail to resonate with customers, resulting in frustration, inefficiency, and missed opportunities. This course starts from the premise that weak sustainability implementation often stems from imbalanced stakeholder relationships. When managers fail to balance the needs and expectations of different stakeholders, tensions and conflicts arise. Learning to understand and manage these tensions is central to effective corporate sustainability. We introduce stakeholder theory as a central framework for the course, including an interview with its founder, R. Edward Freeman. Throughout the course, stakeholder theory serves as our lens for examining how real-world organisations address both the challenges and opportunities involved in integrating sustainability into organisational practice. We explore sustainability in relation to key stakeholder groups, including across functions and roles within organisations. You will have rich opportunities to analyse organisational efforts, reflect critically on different sustainability strategies, and consider how these insights apply to an organisation of your own choice. We also invite you to contribute examples from your own context and country, so that together we can broaden our understanding and discover new approaches to sustainability. By the end of the course, you will have developed a clear understanding of the challenges and opportunities involved in integrating sustainability into organisational practices. You will gain a solid grounding in stakeholder theory and balancing practices, and we will introduce a range of approaches that organisations use in their transition towards sustainability. Most importantly, you will be equipped to think about corporate sustainability in new and practical ways, and to design strategies that balance stakeholder demands constructively. This is an exciting time to be working with sustainability integration — and we look forward to exploring it with you. Let’s get started.

Syllabus

Introduction

This module explores why failures in managing corporate sustainability continue to occur, at times also culminating in greenwashing scandals. Companies may intentionally or unintentionally fail to balance their business practices with the needs and expectations of stakeholders. While trade-offs and compromises are often unavoidable in the short run, consistently neglecting the legitimate interests of key stakeholders is unsustainable in the long run. Effectively balancing stakeholder needs and expectations is therefore essential for any company that aims to take corporate sustainability seriously.

A stakeholder perspective on corporate sustainability integration

The basic argument is that there is broad agreement that corporate sustainability should be integrated within organisations and in their relationships with key stakeholders. However, in practice, only a few organisations succeed in embedding corporate sustainability in any meaningful way. A fundamental reason for this is that organisations often fail to balance their sustainability efforts with the needs and expectations of key stakeholders. The lecture video introduces the core tenets of corporate sustainability and explores different types of balancing practices in greater depth. It is followed by an interview with the father of stakeholder theory, Professor Ed Freeman.

Balancing sustainability and customer relationships

Many sustainable businesses have disappeared because customers perceived them as inconvenient or irrelevant. Companies must offer products and services that align with the interests of both existing and potential customers. For example, some companies have discovered that production waste can create value for entirely new customer segments. Coffee grounds, for instance, can be sold to firms that transform the waste into beauty products, while chickpea water can be repurposed into confectionery items. This module explores innovative approaches to building customer relationships that support sustainability and circularity, helping organisations balance their sustainability initiatives with customer interests.

Balancing sustainability and employee relationships

Corporate sustainability only becomes real when people across the organisation believe in it and act on it. Employees at every level — across units, departments, functions, and professions — are the ones who turn sustainability ambitions into everyday practice. This module explores how organisations can inspire and support employees to actively engage with corporate sustainability. From cross-functional collaboration to campaigns and training programmes, we examine the approaches that help embed sustainability into daily work. As such, this module shows how sustainability transformation can become a shared journey, driven by people and sustained through collective action.

Balancing sustainability and owner/investor relationships

The relationship between profit and purpose is often presented as a tension in discussions of corporate sustainability. A common argument is that businesses face a trade-off between serving shareholders and meeting the needs of wider society. While such tensions can exist, this view oversimplifies how organisations actually operate. Ignoring stakeholders such as customers, employees, suppliers and communities rarely supports long-term success. In fact, companies that overlook these groups often undermine their own future value. Stakeholder interests also tend to overlap. For example, many small and medium-sized enterprises (SMEs) are led by owner-managers whose personal values strongly influence business decisions, blurring the line between economic goals and ethical considerations. It is therefore misleading to treat profit and purpose as entirely separate. Moreover, organisations are not always passive when it comes to investors: those with strong business models and growth potential can often choose partners whose priorities align with their own. In this module, we explore how organisations can balance profit and purpose in practice.

Balancing sustainability and business partner relationships

In today’s world, partnerships are no longer just a nice-to-have—they are essential for driving sustainability and circularity. Partners can include suppliers, technology providers, consultancies, and many others. This module explores how organisations can create innovative collaborations that generate value for both business and society. For example, digital tools can make the value chain more transparent, while what is considered waste for one organisation can become a valuable resource for another. New types of joint ventures can open up previously underserved markets, including those targeted by Base of the Pyramid (BOP) strategies. Beyond this, organisations can come together to form larger networks, working collectively to raise sustainability standards across entire industries. In this module we will discuss and explore examples of such business parterships for sustainability.

Balancing sustainability and societal/non-market stakeholder relationships

In this module, we examine how companies can create partnerships with non-market stakeholders that are mutually beneficial. For instance, businesses can work alongside NGOs to deliver valuable community services. New types of public–private partnerships can also help improve access to essential services for vulnerable groups, such as in health and education. At the same time, collaboration between public and private actors can drive the financing and implementation of green solutions, supporting the transition to a more sustainable future. However, these cross-sector partnerships need to be carefully designed to avoid pitfalls such as mission drift or co-optation.

Concluding remarks and final assignment

This course has explored how companies can integrate sustainability into their core strategy and operations by balancing the needs of key stakeholders. We began by examining the widespread consequences of unethical business practices and the gap between corporate promises and actual behaviour. From a stakeholder perspective, sustainable business is about creating value not just for shareholders, but for customers, employees, investors, business partners, and society at large. We looked at practical ways to manage these relationships: aligning sustainability with customer expectations, engaging employees as both beneficiaries and drivers of change, integrating owner and investor priorities, collaborating with business partners across supply chains, and working with societal stakeholders such as governments, NGOs, and local communities. Across all areas, transparency, collaboration, and a focus on real improvements are essential for meaningful sustainability integration. For your final assignment, you will have the opportunity to demonstrate your understanding by analysing how a company can balance sustainability goals with the expectations and interests of its key stakeholders, drawing on real-life examples and your own experiences.