Business, Financeand Training

The research unit's objectives focus on three overarching, closely linked questions:

• Business strategies and measures:
  How can companies ensure their own transformations succeed and help to tap into new markets
• Impact-oriented finance:
  How can sustainable finance mechanisms provide support to facilitate and expedite this transformation?
• Education for self-effective transformation:
  What skills are needed in these times of change and upheaval?

In essence, the researchers are concerned with how to support the sustainable restructuring of the real and finance economies, and how to turn stakeholders into active, self-effective agents of change.

The three topics of "business", "finance" and "training" serve as complementary fields of research and action in micro-economic contexts. They are aligned with a wide range of environmental and social targets currently under discussion in relation to the Sustainable Development Goals (SDGs), the dimensions outlined in the EU Corporate Sustainability Reporting Directive (CSRD), the provisions of the EU Sustainable Finance Disclosure Regulation (SFDR) and the EU Taxonomy Regulation, the implementing measures of the EU Ecodesign for Sustainable Products Regulation (ESPR) and the fields of application of the EU Corporate Sustainability Due Diligence Directive (CSDDD).

The researchers engage with companies to develop strategies and roadmaps for the transformation, while focusing on the effectiveness of defined measures. In addition to the objective of accelerating the integration of renewable energy technologies and achieving targeted reduction in emissions, energy use and resource consumption, the research unit focuses primarily on how to create new business models and product-service systems. Its researchers support companies in relation to strategic direction and change management. Their scientific pursuit of a successful transition incorporates both empirical evidence and theoretical development, always actively integrating stakeholders, practitioners and experts.

Driving a sustainable transformation in medium-sized enterprises and local authorities requires both debt and equity financing – and even this alone may not be sufficient to accelerate the required change. However, the urgent need for significant capital investment is also subject to strict disclosure obligations, risk assessments and the terms set by financial backers. Nevertheless, the mutual need for ESG data currently provides an opportunity to secure more targeted financing and more effective support, and to mobilise private capital.

Under the umbrella term "finance for sustainability", the researchers focus in particular on how to direct capital towards impact and provide incentives. Taking account of the classic risk-return ratio, ESG data and process data represent the vehicle through which to develop new financial instruments. These instruments operationalise transitory and physical risks and permit robust measurement of the positive contributions that specific investments make towards environmental and social targets. In addition, the researchers apply their years of methodological experience in analysing the impacts of green and social lending to facilitate re-financing on capital markets and quantify co-benefits for those involved – one example being green budgeting for public budgets.

Although new business models, products and instruments have the potential to accelerate the sustainable transformation, their implementation often fails due to deficiencies in their integration into a company’s culture and processes. The causes include a lack of awareness and skills shortages, which is where the focus topic of training comes in. The research unit's third pillar deals with the communication of transformation knowledge and the widespread development of skills among employees at all organisational levels. This is a condition for stakeholders in the real and finance economies to implement the analysed need for action. Fundamentally, this involves conveying content from (professional) education for sustainable development, designing and adapting training and teaching modules, and jointly establishing spaces of learning and experimentation. In transformation academies, the research unit’s specialists prepare theoretical content in a way that enables employees at all organisational levels to feel self-efficacy, by translating the content to their own areas of activity. The researchers work with the respective target audience to identify the key content and develop formats that ensure direct links to practice. They also support the provision of this training and continuously adapt the process in response to changing framework conditions.

Bankable transition plans at the sectoral level represent just one example of the complementarity between the three focus topics, disclosure obligations and overarching sustainability targets. These strategic instruments draw on sustainability (ESG) data – which companies disclose in any case – and engage directly with financial backers’ perception of risk and disclosure obligations. Yet, these instruments can only be successful when competent stakeholders in these organisations develop and implement them in participative processes.

The team replies on an interdisciplinary approach to pursue these focus topics, interlinking insights and methods from the fields of economics, social science, educational science and engineering. They deploy established sustainability management, change management and impact modelling tools while also developing proprietary, stakeholder-specific instruments. Impacts are then mapped out along plausible multi-dimensional impact pathways and logics, implemented by stakeholders in a participative approach. In real economy in particular, this approach enables researchers to conduct research not only about companies but also in partnership with them.

There are, therefore, many important points of contact with other research units in the Sustainable Production and Consumption Division – in relation to real-world labs, socio-technical innovations and climate change adaptation in local authorities, along with industrial design and impact measurement with regard to product-service systems, lifestyles and consumer behaviour.