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The impact of trade associations on climate change adaptation in the wine industry
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Abstract:
Firms join trade associations to gain legitimacy and access commercial benefits, but membership also binds them to shared rules and standards. For climate-sensitive firms, this creates a dilemma: to retain their benefits, they must comply with membership rules that constrain their ability to implement adaptation measures. To examine this tension, we study how strategic adaptation to climate change unfolds in the French wine industry, where trade associations strictly enforce prescribed practices on affiliated firms. We compare this to climate change adaptation in California, where firms face minimal constraints on their practices through membership rules. We find that the central, deliberate, and normative nature of French trade associations, which we label as ‘dogmatic,’ creates rigidity that hampers short-term adaptation but also fosters longer-term changes in production practices that preserve the industry’s distinctive collective identity. By contrast, the flexibility of the ‘pragmatic’ trade associations in California enables individual adaptation but fails to spur collective responses. We contribute to research on institutional maintenance, climate change adaptation, and trade associations by empirically unpacking and theorizing how trade associations shape firms’ adaptation practices in the context of climate change.
Bio:
Frank Wijen is a Professor of Global Sustainable Strategies at the Department of Management, Strategy, and Innovation of KU Leuven’s Faculty of Economics and Business. He is also the Director of KU Leuven’s Research Centre for Sustainable Business and Economy and a Visiting Professor at the Society and Organizations Institute at HEC Paris. Prior to joining KU Leuven, Frank was an Associate Professor at Rotterdam School of Management, Erasmus University. His PhD in Management was awarded by Tilburg University. He also worked as a Marketing Manager in a Belgian social enterprise. Frank’s research is concerned with global sustainable strategies writ large. Operating at the intersection of strategy and organisation theories, he studies the drivers and contingencies of sustainable business practices in international settings. In particular, Frank examines the strategies that incentivise and enable governments, firms, and nongovernmental organisations to engage in sustained collective action that leads to more environmentally and socially beneficial business outcomes. Influencing power configurations and effectuating learning processes leading to more sustainable business practices are prominent instances of such strategies.