International Accountability Standards (IAS) between substantial implementation and decoupling – A qualitative multilevel analysis in the textile industry

• Applicant: Professor Dr. Dirk Ulrich Gilbert
• Subject Area: Accounting and Finance
• Term: from 2018 to 2021
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 404790484

International Accountability Standards (IAS) are voluntary predefined rules, procedures, and methods to systematically assess, measure, audit and/or communicate the social and environmental behavior and/or performance of firms. IAS have the capability to contribute to a more sustainable economy. However, to benefit from this potential it is of particular importance how IAS are implemented, as the adoption of an IAS cannot be equated with its substantial implementation. Its adoption may also serve to show compliance with external demands while not changing internal practices noticeably. This issue is called policy-practice-decoupling or ceremonial implementation. The neoinstitutional position suggests that decoupling arises from intentional decisions made by top managements to balance external legitimacy and internal efficiency demands. However, there are indications, that multiple levels of analysis play a crucial role for defining the way of IAS implementation: the behavior of the standards developing organization at the institutional level, the behavior of the adoption decision makers at the organizational level, and the behavior of the departments at group level. A literature review shows that there is a considerable deficit regarding multilevel research on standard implementation. Another aspect, which cannot sufficiently be explained by neoinstitutional theory and has hardly been considered by research so far, are changes in implementation manners over time. This includes the phenomenon of recoupling, i.e. changes from ceremonial to substantial implementation. To the best of our knowledge, cases where firms run through different stages of substantial implementation, decoupling, and recoupling have not been examined at all so far. This research project addresses these two research gaps: 1) a lack of multilevel approaches to consider explanatory mechanisms of IAS implementation, and 2) a lack of approaches considering recoupling and other dynamic aspects of implementation processes. The research project aims at theory building regarding standard implementation processes. The two research questions are:a) How do actions and communication within and in-between institutional, organizational and group level influence substantial and ceremonial implementation of international accountability standards (IAS)?b) How do changes in action and communication over time influence substantial and ceremonial implementation of IAS? In the context of unclear relations between the levels and a lack of process oriented approaches to empirically assess decoupling and recoupling, we outline an explorative research design, namely a qualitative case study with longitudinal elements. We concentrate on the sports goods company Adidas and its implementation efforts regarding an IAS focusing on chemical regulation (DETOX). DETOX was developed by the organization Greenpeace. Both, Adidas and Greenpeace have already declared their willingness to cooperate.

• DFG Programme: Research Grants