The Fear of the Known and Unknown in Being the Sustainable Business: Environmental Concern Reflected by Axfood (Sweden)

Abstract

This research aims to examine the feasibility of adopting a corporate social responsibility strategy that prioritises environmental protection within the food distribution and retail sectors. The environmental strategy involves ecofriendly packaging, streamlined logistics, and conservative energy use. The company Axfood serves as a case study. The study involved public records observation, store visits, and discussions with the managers and head of CSR. The study employed a case study approach, utilising data collected from various sources and analysing it for depth and breadth of understanding to uncover systemic causes of environmental concern at Axfood. Three outcomes were derived from the practical experience gathered from observation, repeated store inspection, interviewing customers and store managers, and five conversations with top management. Recycling and cutting costs through energy efficiency allow businesses to compete based on low prices and high-quality products. It is not a long-term fix to have the market pressure businesses to prioritise products above social audits and unclear reports. Finally, the answer for future business is to learn from competitors and reach parity by having what others have while being distinctive in some respects, such as having a superior environmental conscience.

1. Introduction

The World Summit on Sustainable Development, SDGs, and the 2030 agenda have depicted the environment as the topmost concern regarding sustainability and sustainable business, which could create employment and satisfy sustainable consumption preferences [1,2]. There is connection with SDGs, Agenda 2030, and other internationally recognised frameworks and agreements [3]. All the member states broadly accept these agreements, so environmental concern is the focus of sustainable businesses, especially the food industry. Environmental care was the driving force rather than financial gain or economic efficiency as it ensures that businesses survive in the longer run [1]. Several critics and academics have discussed the concerns around sustainable business operations, such as developing a generalised retail charter that could steer towards the support for all stakeholders, exploring food waste at retail stores, shift of thinking for economic connection of sustainability and CSR, transformations needed, sustainable retail store brand experience, business model innovations, retail centred sustainability issues of infrastructure, energy usage, and overall end-to-end operations [4,5,6]. There has been continuous struggle for examining the incorporation of environmental considerations into commercial objectives, turning them green. Sustainability has been projected as a strategy for producing high-quality goods and services by providing real green-value to customers. There is a clear call for green business modelling for engaging with multilayered environmental concerns that surround the ‘enablers’—green research and development, green lean operations, and initiatives, and ‘results’—sustainable consumption and green economic gains [5,7,8,9].

Criticising CSR and sustainability, several researchers have projected the lapses in understanding the business-game effects of spillover, reduction in preference, strategic goal alignment and communication of CSR issues, and management systems [10,11,12]. The shift to green management systems through application of the EFQM model, as an assessment tool, has been observed to have some promising opportunities [13]. There is an increasing body of research that reflects corporations to be reliant on the natural and social systems in which they operate for their resource supply. So, the company feels pressured to act responsibly for the ecology and environment in which it operates. Being accountable necessitates that strategy at the organisational level supports the operations inside it [14,15,16].

CSR researchers and nongovernmental organisations (NGOs) are scrutinising major corporations’ sustainability practices, which has sparked a discussion about greenwashing. One possible source of evidence is from the current greenwashing techniques used by ostensibly sustainable corporations. It showed a negative relationship between environmental thinking and economic success [17]. The most intriguing finding was that reporting on a company’s charitable giving can boost its stock price. This means that firms disclose information for financial gain rather than for holistic expansion that considers the reduction in negative externalities. In this light, the reason behind the lack of concentration from the corporations on revolutionary ecoeconomic activity and stress on the projection and promotion of their ’good‘ things and communicating them to society [17]. As a result, businesses are being evaluated not just on the rhetoric they use in their marketing and online presence, but their actual behaviour throughout the entire product’s lifecycle, directly affecting the ethical business notion. Academics have established several standards. While CSR practises differ by sector, it is crucial to identify a specific category that includes measurable goals and minimally acceptable levels of effort. It is also important to note that no system to date—from ecocosting to accessible market environmentalism to government legislation—has controlled and checked environmental activity across industries individually. Currently, the only approach that appears to be working is a combination of efforts from company management and government involvement [18].

It has been investigated that the company’s greenwashing techniques by zeroing in on the company’s unclear reporting practises, in which the reader is frequently left confused. Levin and Behrens used phrases such as ‘encouraging monitoring‘ and ’creating mechanisms to minimise consequences‘ to give the reader the idea that the organisation had taken these steps. At the same time, the firms have not implemented their mentioned intents or plans. The fact that this is also a practice in some government institutions is deeply concerning. The communication mechanisms of corporate heads and overall corporation for socioresponsiveness is an element of concern for academicians and practitioners to understand the communication mechanisms in a better way that lead to enriched explanation of corporate–stakeholder relations [19,20,21,22].

The phrase ‘extended producer responsibility’ (EPR) was coined by Swedish environmental economics professor Lindhqvist, who also signalled the beginning of a collective policy requirement for sustainable practices across Europe. He defined it as holding manufacturers accountable for their products throughout their whole lifecycle, including collection, recycling, and disposal [23,24]. The DFS (design for sustainability) is related to SPLCA (sustainable product life cycle assessment) in that it emphasises comprehensive factor identifications that involve the steps of innovation and transitions [25,26].

In the postpandemic and postindustrial age, customers now demand sustainable business practices, and it is projected to be economically viable in the business market as well [6]. Sustainability in businesses makes them ethical and enables them to take care of all the stakeholders and this makes them market competitive and responsive. Therefore, organisations strive to engage in ethical business practices and provide superior goods and services [6,27,28,29]. The World Business Council for Sustainable Development’s (WBCSD) promotion of a better future for future generations has given rise to a global movement of social and environmental activists exerting pressure on multinational corporations. Managers’ changing attitudes and behaviours directly result from the heightened focus on the client. There is optimism for a sustainable future because sustainability is not just a topic of academic development but also has objective evidence in the economic sector [30,31]. As a result of this shift in perspective, the manager’s major priority in a commercial organisation is profit, people, and the planet. Business social responsibility is predicated on the three P’s (people, planet, profit) [30]. A competitive advantage through or with CSR is argued for because of the correlation between profit and responsibility. Several scholars have examined this phenomenon, and they have all come to the same conclusion that corporate social responsibility (CSR) is connected to a company’s competitive edge. Most research that finds a link between CSR and organisational competitive advantage emphasises the environmental dimension of CSR [14,32,33].

The various literary endeavours on understanding CSR have overlooked the environmental issue. It also indicates that the CSR concept’s environmental aspect is poorly understood [34]. To that end, this study applies the EFQM model to a case study of a Swedish firm (Axfood) to examine the company’s corporate social responsibility practices and their impact on the environment. Retail and whole food companies’ corporate social responsibility (CSR) efforts that have a material effect on or direct connection with society and the environment are reflected in this issue. The Swedish retail and whole food industries highly value environmental care as an extended responsibility because the benefit surpassed associated costs and liabilities [23] and the same has been observed by other studies as well [25,26]. In a theoretical effort, the World Business Council for Sustainable Development (WBCSD) discovered the void of environmental concern being neglected that has pushed it to be the area of serious consideration [1,2]. So, the dearth of prior studies in this area and call for studies steered the researchers to study the previously unexplored avenue for exploration. It also considers the three-tiered environmental concerns faced by wholesale and retail companies (packaging, logistics, and storage). The EFQM assessment model is observed to evaluate the organisational operations, strategies and management initiatives by classifying them into ‘enablers’ and ‘results’. This enables the mapping of the organisation for environmental concern [5,7,8,9]. Several studies have already emphasized the significance, vitality, and need for understanding the case of sustainable businesses, and Axfood cannot be negated in this movement [13,15,29,35,36,37,38,39].

2. Literature Review for Gap Identification

Today’s industries do not require antiquated production and transport methods. Maintaining an edge over the competition in the long term requires superiority in production, distribution, and consumer technology innovation. Because of this, the company can put resources into other endeavours that would not have been possible without these cutting-edge methods. Hence, if the management of a firm opts to operate sustainably, the economic constraints and crises that drive them to cut costs establish the way to a brighter future [8,10,40,41,42,43,44]. The tactic for business operations—cost minimisation—was broadened to include business strategy and industry. Methods that are both environmentally sustainable and economically viable were sought. Stress was on waste in production and to make better use of recyclable scraps. This means there needs to be a system for reducing the amount of waste produced and then recycling it [45,46,47,48,49]. Several researchers have recently raised concerns on greening the packaging, as it affects other value chain connections of the supply chain, energy consumption, and other crucial elements of business operations [45,46,47,48,49,50,51,52,53,54].

Many retail establishments benefit from consolidating their energy resource management and control operations. Energy efficiency is becoming a priority for many retailers. Many are sounding the alarm through their work for the crucial positioning of mapping energy consumption for its mitigation. The carbon footprint is the focal point that projects the sustainability situation of the food industry from multiple dimensions, so there is a clear call for further study. The storage of products is linked with the lighting mechanism that is deployed at the store, which impacts the carbon footprint by disturbing the temperatures of the store at different sectors. This can pose challenges for storage and stacking and eventually leads to consumer preference shifts. Therefore, the product storage strategy speaks volumes about the company’s commitment to social responsibility. It describes the company’s measures to reduce energy consumption and maximise storage capacity, and eliminates the need for plastic bags and display shelving in their product packaging [4,29,48,55,56].

Corporate social responsibility (CSR) is seen as an essential business strategy because of its potential to increase the company’s competitiveness for sustainable business [30]. The comprehensive analysis of the EFQM business excellence models contains three essential components: management style, operational procedures, and quantitative measures of success. In reality, these ‘three’ define the connection between ‘enablers’ and ‘results’ while simultaneously highlighting the role of other elements. Along with other stakeholders and customers, the EFQM prioritises environmental considerations. The companies which intend to keep track of environmentally responsible actions have to focus on the environmental perspective of the CSR reporting function, which falls under the ‘enablers’ category of resources. The ‘Excellence Model’ focuses on the company’s current activities and improving those activities [13,15,36,37,38,39,57,58]. To guide businesses to excellence, it has been stressed to go beyond formal assessment when observing the link between organisational ‘enablers’ and ‘results’ [37]. Likewise, there is a need for recognition at strategic level that the EFQM model can make a difference’ [58]. Therefore, the researchers went beyond the formal assessment and observed the environmental concern of the case through various means.

3. Methods and Material

The article titled ’Sustainability a Tool for Employment Opportunities‘ used a business canvas model for checking the environmental concern for sustainability in business society and discussed the way forward [1]. Similarly, several researchers have utilised the EFQM model for assessing the c = environmental concern. This means that the EFQM model can be a vital and significant way of studying the case of Axfood (specifically Willys) for assessing their sustainable business operations and having the consideration of environmental issues on the top of the list [13,15,36,37,38,39]. Case studies are often used for in-depth analyses of complex phenomena. The bigger picture of the impact on future growth in ethical business cannot be extracted from just examining the numbers, which reveal the present state of affairs [59]. Many of the employees and customers did not accept the invitation for interviews due to various reasons. Altogether, eleven employees, who included the store manager and corporate head and three customers, accepted the invitation for interview. The EFQM model was utilised for this goal achievement. The European Foundation for Quality Management [60] model implementation for analysing CSR and sustainability concept outcomes in corporate organisations lacks comprehensive theoretical proof. More than 30,000 European businesses have reportedly adopted and adapted this strategy. Sweden is home to many EFQM members [60]. However, the problem is that few Swedish retail food stores have given attention to the EFQM.

Scholars who have examined the sustainable business practices of Axfood (Willys) from various angles have relied on case study methods to draw their conclusions. The case study approach is helpful since it encourages researchers to consider the topic from various perspectives. Scholars that come after them build upon this foundation of knowledge to create new insights and advance the area [61].

The secondary data was comprised of the (i) CSR reports, (ii) code of conduct document, (iii) annual sustainability report, (iv) details about the company’s website, and (v) financial overview. Data were gathered through in-store interviews, observations, and interviews with the store’s head of social responsibility and environment, the store manager, staff, and clientele. Report data were analysed via direct observation and in-depth interviews. In order to deduce the meaning of the interview, answers given by each group were summarised first and then compared with the groups’ reactions to a single scenario or set of variables. For instance, the report’s operations were watched in-store and looked for in customer and employee testimonials. By classifying the participants’ answers, a comparison was made for the three sets of interviews. Responses were sorted into categories [62].

4. Analysis and Discussion

The main website is bilingual (in English and Swedish), while the Willys website is only available in Swedish, which is at odds with Willys’ responsible behaviour in the business. Large local families and college students comprise a significant portion of Willys’ target market. Owing to the lack of information on the company’s websites in English, there were concerns of extended producer responsibility. Missteps have been made in terms of which objectives have been fulfilled. A common practice among businesses is to use different colours to denote the three stages (completed, ongoing, and potential) of a given goal. The environmental-costing issues for suppliers outside the Swedish borders were not completely covered. Conversations with top management also enlightened us about the dire state of social audits in China, as just one example. This means there is a lack of clarity and specifics. The need for strict, detailed and standardised rules has been observed that do not give room for any intentional or unintentional green washing activities at any publicly available information means [30].

Table 1. Coding, comparison, and analyses of responses from three dimensions.

Environmental Concern	Strategy and Leadership	Frequency (Concerns Valued)
	Store Manager & Top Management	Employees (11)	Customers (4)
Private brands are good	Focal strategy	11	4
Organic cheap products	Strength	7	3
Ecostore environment	Lower expenses	5	2
Healthy labelling	Loyalty	2	1
Local products	Demand	6	4
Cheap grocery store	Opportunity	10	4
Budget products & ecoawards	Market Leadership	7	3
Ecomanagement leads to profit	Experience	5	4
Ecoawareness	Key Indicator	6	3
Ecodrive	Policy	2	3
Carbon footprint	Environment	4	2
Food wastage	Ethical	6	4
Product packaging	Recycling	3	4
Green energy and energy conservation	Future	7	4

reflects the environmental concerns (results) and strategy and leadership (enablers) in the form of codes with frequencies (digits) of approvals from the employees and customers.

The results as per the EFQM model are organic cheap products, ecostore environment, healthy labelling, local products, cheap grocery store, budget products and ecoawards, ecomanagement leads to profit, ecoawareness, ecodrive, carbon footprint, food wastage, product packaging, and green energy and energy conservation.

The corresponding/linked enablers as per the EFQM model are strength, lower expenses, loyalty, demand, opportunity, market leadership, experience, key indicator, policy, environment, ethical, recycling, and future.

This means that the organic cheap products is considered the strength of Willys by seven out of eleven employees and considered somewhat the strength by three consumers out of four. Similarly, the comparison and contract between the employees and customers projects that branding, costing, strategy, and futuristic approach are the key dimensions.

The systemic flaws in the Swedish food wholesale and retail industry and perhaps misleading public reporting are observed. Employees also lack the freedom to speak their minds regarding the organisation. Information about accountability from farm to fork, particularly in the context of international vendors, is poorly understood and conveyed in the media. When there is a lack of transparency in public reports, it becomes challenging to make informed decisions. As a result, citizens do not know how many vendors are disciplined, cautioned, or educated for failing to adhere to the organisation’s stringent environmentally responsive regulations. Nonetheless, it is becoming the norm for communicating ethical consumption, disposal, and reuse in public awareness initiatives. The solely reusable shopping bags were Willys’ goodwill gesture. Researchers found that the annual public report gave minimal attention to suppliers’ environmental responsibility tales and how they have benefited in outcomes, even though audits of suppliers, business relations, and external organisational activities were conducted. Suppliers are considered trade secrets [27] and hence should not be disclosed publicly; yet this lack of transparency further clouds the issue of corporate environmental responsibility. Rather than keeping its suppliers’ identities secret, the corporation could have disclosed its procedures. This ties in with other behaviours of retail and wholesale organisations, where it has been noticed that they do not provide information about supplier responsibility audits, penalties for infractions, or corrective measures taken. In addition, this network of associations concludes that pressure from corporate social responsibility and cost-cutting has been mounting on food storage companies. The company has not yet reached a level of maturity where it can effectively police the environmentally destructive actions of its international suppliers. Researchers found that despite the company’s efforts to portray itself as the economically viable option for socially acceptable products, it faces pressure to avoid rejecting uncooperative suppliers from low-priced competitive markets in Europe and elsewhere.

Reducing this strain has been the focus of CSR’s cost-cutting initiatives, such as reusing and recycling store materials and packaging. Electronically controlled usage and environmentally friendly logistics have also contributed to the price drop, but these factors alone are sufficient to act appropriately within Sweden’s borders. As it is difficult and complicated, the actual problem and gap are noticeable when the many large corporations that have won honours on the home territory cannot oversee the activities of their suppliers concerning their products [27]. Until otherwise specified, the management team has assumed that anything that can reduce costs falls within the umbrella of ’extended responsibility‘ (ER), and they have ignored any potential sources of liability expansion. The promise to future generations to pass them the same availability level of natural resources through conservation as experienced by the present generation is vulnerable; steps such as assessing the sustainable business practices of food industry companies through the EFQM model for further tightening up the belt is a necessity and cannot be a voluntary option.

5. Conclusions

This study contributes to the body of knowledge of sustainable business by projecting the enablers and results through deploying the EFQM model, having Axfood as a case study. The extended responsibility is presently considered a voluntary option that cannot last for long as per the current condition of businesses. It is the responsibility of the food industry businesses to develop a generalised charter that could be the way forward for them to execute the sustainable business mapping exercises on a larger scale. There is a need to know the unknown challenges that the food industry is going to face in this postpandemic and postindustrialised era. Packaging, logistics, and storage are the three dimensions that were studied theoretically and assessed through the qualitative case-study inquiry. The theoretical implications comprise the literary gaps that the currently available studies on food industry pose regarding sustainable business through the EFQM. The managerial implications project the need for focus on enablers and results in terms of mapping the management excellence system, programmes, and initiatives within the business organisations.

6. Limitations and Future Studies

The scope of this research, theoretically and practically, has several limitations that the future studies should address. There are restrictions on the information that may be gleaned from online reports. In contrast to financial reports, which typically adhere to the well-respected International Financial Reporting Standards, it is not mandatory to adhere to such stringent standards when reporting CSR activities. The case study mainly focused on the business operations of Willys and could not compare it with all the major food retail store chains in Europe and Sweden. It would be beneficial to have a separate study on comparative analysis of Axfood and other stores in Sweden, country level comparisons within Europe, and between major international companies. The EFQM is confined to enablers and results, so the gaps in practices need to be studied separately. Moreover, the detailed systematic literature review, coupled with multiple case studies or survey method could explore deeper into environmental considerations for sustainable retail food businesses. Secondarily, it could be a viable option for observing the environmental concerns of food retail chain stores across Europe and then plotted in terms of a business canvas model or EFQM model. A longitudinal study for an open-ended questionnaire that could be anonymously responded to by customers and employees, which could identify issues and challenges on a larger scale, could be utilised by Axfood for better mapping of their strengths, weaknesses, opportunities, and threats. Apart from all these limitations and future studies, this study provides a guiding map for researchers to perform further added-value regarding the body of knowledge and implications at multiple levels.