Governance of wicked problems : the case of Swedish banks and the wicked problem of biodiversity loss

Abstract: As the number of organizations that integrate sustainability in their operations has significantly increased, the issue of sustainability has moved away from being strictly a governmental issue to becoming a governance issue - involving not only the public sector but also the private. Different levels of authority and power try to manage these global sustainability issues, which are defined as wicked problems. However, there is paucity in research on how individual organizations can manage these global wicked problems on a local level, with an increasing number of stakeholders and global governance models. With this research gap identified, this study aims to contribute to the research knowledge of how companies at a local governance level manage global wicked problems through engaging stakeholders and global governance models. To fulfill this aim, the case of Swedish banks is chosen to study along with the wicked problem of biodiversity loss - since biodiversity loss is considered as the most irrevocable environmental crisis, is a wicked problem in need of financing, and is recognized on a global level as a pressing issue to solve. To address this research aim, the study explored various management approaches that organizations can use to manage wicked problems. A conceptual framework was developed - inspired by Multilevel governance, the SDG compass, research on wicked problems and stakeholder engagement. To explore this theoretical approach, a single case study was conducted on four Swedish banks through semi-structured interviews. The study also investigated existing biodiversity frameworks, initiatives and KPIs relevant for Swedish banks. The study concludes that global wicked problems, i.e. sustainability issues, need to be managed at several governance levels - not only on a governmental level. After investigating how Swedish banks manages biodiversity loss, individual organizations are encouraged to tackle wicked problems by first understanding the issue, while using stakeholders, global frameworks, and initiatives to gain knowledge and inspiration. Having defined the problem, future steps include defining priorities and integrating said priorities - when a complete understanding is fulfilled. This study contributes to more knowledge on how organizations could manage global wicked problems on a local level, and especially on a sectoral level for the financial industry. Future research is encouraged to investigate the possibility of managing wicked problems through customers specifically, in addition to analyzing how managing wicked problems can differ depending on if an organization has a direct or indirect effect on the problem.