Employee Sensemaking on the Importance of Sustainability Reporting in Sustainability Identity Change

Abstract

This study examines employee sensemaking processes in order to understand the role of sustainability reporting in organizational identity change. Through an analysis of 52 interviews with employees in two Finnish companies we develop sensemaking frames for understanding the role of sustainability reporting in organizational identity change. The three sensemaking frames are individualistic, relational and decoupled. Each of these sensemaking frames differs in stakeholder orientation. They indicate that sensemaking influences the interpretation of how important sustainability reporting is for organizational identity change towards sustainability. The study showed how the individualistic and relational frames serve as sensemaking frames for framing sustainability reporting as being possibly beneficial in organizational identity change. However, the decoupled frame highlights the deficiencies of reporting, especially from the perspective of a collectivistic stakeholder orientation. We propose that a better understanding of the decoupled sensemaking frame helps to understand the justifications for the increasing criticism that has been targeted at sustainability reporting.