Sustainability as Vehicle for Strategic Entrepreneurship: The German Wine Industry

Introduction

Sustainability has skyrocketed in relevance for management and business. Although the short definition of sustainability that today´s living is not at the expense of future generations (Gladwin, Kennelly, & Krause, 1995) can be traced back to a printed instruction by the German Carl von Carlowitz who managed mining on behalf of the Saxon court of the 17th century. He limited forest logging in respect to the amount of planting putting a strain on the Saxonian mining activities in need of wood for furnaces (Krüger, Schubert, & Wittberg, 2010). But it was not until the 1970s that scientifically based concerns (especially Club of Rome) about excessive global resource exploitation, the oil crisis and widespread famine urged managerial rethinking, stakeholder perspective, and sustainability orientation (Meadows, Meadows, Randers, & Behrens, 1972). A milestone in sustainability conceptualization was the UN publication „Our Common Future“, which placed environmental issues firmly on the political agenda (Brundtland, 1987). The report advocated elevating sustainability to the status of guiding principle in the interest of making the world safe for all human populations and operationalized the concept as a parallel pursuit of economic, ecologic and social aspects. It was also during this period that the managerial principle of corporate social responsibility became a prominent strategic paradigm (McWilliams & Siegel, 2001). Nowadays, youth-let „Friday for Future“-activism and Earth Summits push for climate-friendly behavior. The European Commission is taking a lead for agricultural sustainability efforts manifested in the „Green Deal“ (Krämer, 2020). In parallel, sustainability developed as lever for enterprises to gain reputation and thereby strategic advantage (Adner & Zemsky, 2006; Berns, 2009; Gladwin et al., 1995; Michael E Porter & Van der Linde, 1995). Since consumers are increasingly attaching importance to sustainability, associated strategic considerations by suppliers and marketers of products and services are certainly appropriate. However, sustainable business management is particularly challenging for the agricultural sector. The effort required to implement sustainability in the agricultural industry throughout Germany has been quantified to exceed 100 million Euros - four times the total annual value generation of the entire German agricultural production (Kurth et al., 2019).

This chapter explores entrepreneurial sustainability management as a strategic lever for SMEs referring to German wine producers. Two streams of data generation resulted in empirical data of German wineries on their strategic measures, innovation management, and sustainability. One data pool was created by surveys starting in 2012 realized every two years with more than 300 wineries participating in each panel. Second source consists of a database of more than 800 German wineries on quality performance, website communication and customer perception. Both data sets covering a time span of 10 years. In essence, the data served to explore whether sustainability builds “the missing ingredient in strategy” (Bonn & Fisher, 2011). In addition, the data was exploited to identify promises but also challenges in strategic ecopreneurship building on strategic management theorems. In view of the tension between the obvious need to become more sustainable but operative for wine suppliers, the empirical data on the German wine industry are topical and of high practical relevance.