Why corporate sustainability so often gets stuck in small steps

Ville-Veikko Piispanen’s blog text on why corporate sustainability does not lead to transformation.

Sustainability has become a central part of corporate strategy. Companies talk about climate change circular economy, responsibility, and impact more than ever before. Stakeholder engagement is widely promoted as the key mechanism to make sustainability meaningful, legitimate, and effective. And yet, despite this growing attention, real transformative change remains limited.

In our new open‑access article Revealing the Incrementalism Trap in Corporate Sustainability: The Impact of Conflicting Stakeholder Expectations in Incumbent and Startup Companies, authored by Kim Strunk, Kaisa Henttonen, Ville-Veikko Piispanen and Hanna Lehtimäki, published in the Journal of Business Ethics, we ask a simple but uncomfortable question: Why does corporate sustainability so often result in incremental improvements rather than substantial transformation?

Based on 65 in‑depth interviews with managers and founders in large incumbent corporations and sustainability‑focused startups, our study reveals a recurring pattern we call the incrementalism trap.

The tension of sustainability

At the core of corporate sustainability lies a fundamental tension. On the one hand, there are normative expectations moral demands to act responsibly, protect the environment, and contribute to society. These expectations are often strongly held by employees, entrepreneurs, and parts of civil society. On the other hand, organisations face pragmatic expectations, the need to remain competitive, profitable, compliant, and operationally viable.

Both perspectives are legitimate. But when organisations try to satisfy all stakeholders at once, sustainability decisions are often shaped by what generates the least resistance rather than the greatest impact. Instead of asking “What change is needed?”, organisations ask “What change is acceptable?”

How stakeholder engagement can constrain change

Our findings show that stakeholder engagement, while widely regarded as essential for advancing corporate sustainability, can also unintentionally limit sustainability ambition. In practice, organisations often face multiple and competing stakeholder expectations that shape which sustainability initiatives are considered feasible, legitimate, and acceptable. Rather than enabling bold change, stakeholder engagement can steer organisations toward compromise solutions that minimise conflict but also reduce overall impact.

We identify four recurring tensions that structure corporate sustainability practice. First, employee identity tensions emerge when sustainability initiatives help attract new, purpose‑driven talent but simultaneously unsettle existing roles, routines, and professional identities. Second, business model tensions arise when sustainability initiatives are expected to align closely with established revenue logics, limiting the scope for more disruptive change. Third, customer communication tensions favour visible, easily communicable actions over systemic transformations that are harder to explain and justify. Finally, regulatory scope tensions encourage compliance with minimum standards rather than proactive experimentation or leadership beyond regulation.

Taken together, these tensions push organisations toward sustainability actions that are visible, manageable, and broadly acceptable to a wide range of stakeholders. However, such actions are often limited in scale and impact. Over time, this dynamic creates what we describe as the incrementalism trap, where organisations accumulate legitimacy through small steps while avoiding the deeper changes required for meaningful sustainability transitions.

Startups and incumbents: different paths, similar traps

Interestingly, the incrementalism trap affects both large incumbent corporations and startups, though it manifests differently across organisational contexts. Incumbents typically possess substantial resources and influence, but their sustainability efforts are constrained by established structures, stakeholder expectations, and risk‑averse decision‑making processes. Startups, in contrast, often pursue more radical sustainability solutions but struggle to scale due to limited resources, credibility challenges, and restricted regulatory or market influence.

In both cases, sustainability becomes shaped less by what environmental and social challenges objectively require and more by what stakeholders are willing to tolerate, fund, or approve. As a result, even organisations with strong sustainability ambitions may find themselves progressing through incremental adjustments rather than pursuing transformative change.

Moving from incrementalism

Our study does not argue against stakeholder engagement. Instead, it calls for more focused and strategic engagement. To move beyond incrementalism, organisations need shared sustainability understanding, clearer priorities, and the courage to engage with conflict rather than smoothing it away.

Sustainability transitions require more than balancing interests they require rethinking what legitimacy, success, and value creation mean in practice.

If sustainability is always negotiated down to the lowest common denominator, we should not be surprised when progress feels slow.

Ville-Veikko Piispanen ([email protected])

Article

Strunk, K., Henttonen, K., Piispanen, VV. et al. Revealing the Incrementalism Trap in Corporate Sustainability: The Impact of Conflicting Stakeholder Expectations in Incumbent and Startup Companies. J Bus Ethics (2026). https://doi.org/10.1007/s10551-026-06302-y