Glocalizing sustainability: how accounting begins for sustainable development goals in city administration

In 2015, the United Nations (UN) Member States adopted the global 2030 Agenda for Sustainable Development (Agenda2030) and Sustainable Development Goals (SDGs) to steer global sustainable development from 2016 to 2030. The program includes 17 goals and 169 more specific subtargets. While Agenda2030 is a global program, its practical implementation takes place at the national and local levels. In this study, we are specifically interested in uncovering the role of Agenda2030 in advancing sustainable development in local governments, directing our focus on the internal process of its integration in cities.

At the local level, cities can significantly contribute to achieving SDGs (Guarini et al., 2021) – half of humanity lives in cities, and cities account for 60–80% of the world’s energy consumption and 75% of carbon emissions (UNEP, 2022). Cities need to create new accounts to measure, monitor and communicate their progress against the global targets of SDGs and to integrate them into their strategic planning and management (Guarini et al., 2021; Kaur and Lodhia, 2019). By creating new accounts on SDGs, cities can understand their own performance and steer their development toward the implementation of Agenda2030 (Bebbington and Unerman, 2018).

Some studies indicate the significance of populations’ demographic and socio-economic characteristics on how strongly local governments take sustainability issues into account (Saha, 2009; Svara et al., 2013). While this is important to acknowledge, affecting the demographic or socio-economic characteristics of local populations seems like an unlikely means of achieving sustainability change for most local governments. However, “[t]he overwhelmingly positive influence of state involvement in local sustainability planning efforts” points out that national (Saha, 2009, p. 46) and, arguably, international, institutional support for sustainability management is critical in inspiring sustainability action in local governments. It is also noted that the valuation (appreciation) of concrete environmentally themed goals in local governments is associated with more sustainability activities (Svara et al., 2013). Our interest is in understanding the process of integrating concrete sustainability goals in local governments.

Leaning heavily on Frank Birkin’s thinking, Ball (2004, p. 1031) considers that local governments are a vehicle for advancing sustainability accounting practices and that utilizing this vehicle has the potential to change society – that is, the context businesses operate in and the businesses themselves. Based on this, Ball (pp. 1031–1032) suggests further research focusing on “strategies or co-operation at multiple levels and the development of (say) malleable accounting boundaries, bases on policies, or partnership arrangements cutting across the public and private domains.” It could be argued that SDGs are a concept that touches upon all these dimensions.

Guarini et al. (2022) describe the integration of SDGs into city strategic planning and management by reflecting on the prior research and through empirical data derived from the strategic plans of Italian cities. They note that sustainability is mainly limited to strategic plans and that there are few or no signs of translating sustainability into operational-level performance indicators (p. 596). Furthermore, they propose further investigations into whether the integration of SDGs affects the existing strategies and management practices or whether this would “mean rethinking existing strategies and management practices through a new lens” (p. 598).

There are existing cases in the literature that explore the integration of novel ideas and the influence of social structures, actors and processes on local government “strategizing,” explaining how it can happen through visualizing and calculating stages (Trunova et al., 2022) or thinking infrastructures (Träskman, 2022). These examples suggest that the integration of new ideas, such as sustainability or SDGs, into the interpretive scheme of a local government organization is not as straightforward or clear as Guarini et al. (2022) imply – i.e. either there is a change or there is not. Instead, we consider the change of perceptions as a multilayered social process where change happens gradually in small steps, even though we agree with Guarini et al. (2022) that sustainability needs to be included in performance indicators if sustainability is to be included in the interpretive scheme of local government.

To explore how new accounts on SDGs are adopted, introduced and deployed in the strategic planning and management of local governments, this study uses Power’s (2015) fourfold development schema of policy object formation, object elaboration, activity orchestration and practice stabilization to understand “how accounting begins.” Through this schema, our aim is to explore the processes and instruments city administrations utilize in building the understanding about their performance through (and of) SDGs. Thus, our research question is: How does accounting for SDGs begin in city administrations? However, we acknowledge, like Power (2015, p. 43), that “accounting never simply begins but has multiple conditions of possibility which align as drivers for change at both field and organization levels.”

Following a case study strategy, we intend to provide a description of the integration of the SDG agenda across six municipalities in Finland. In particular, we focus on the ongoing process in the cities to unveil the common patterns of the adoption of Agenda2030 and possible distinctive features in an explorative way.

The six case cities were investigated through the combination of expert interviews and document analysis; they present national and international pacesetters integrating Agenda2030, SDG indicators and Voluntary Local Reviews (VLRs) into their strategic planning and management. The selected cases provide a setting where the integration of SDGs has already been undertaken and currently is at the stage of active adoption. It is worth mentioning that Finland provides an interesting empirical context for the study for at least two reasons. First, local governments have a high degree of autonomy in the Finnish administrative system, thus the formation of the city’s strategic priorities and how they are being operationalized from a managerial and organizational perspective differs across municipalities. Second, Finland, along with the other Nordic countries, has become a pioneer in adopting Agenda2030 and SDGs, taking a proactive stance on introducing innovative practices for their implementation and, thus, offering some national institutional support for the cities. Cities in Finland account for over 35% of total government spending and over 15% of the national GDP (OECD/UCLG, 2016), and they provide roughly two-thirds of the public services. The Association of Finnish Municipalities (Kuntaliitto) estimates that the cities and municipalities in Finland are responsible for the implementation of two-thirds of SDGs, and the municipalities' operations connect with all SDGs (Kuntaliitto, 2022).

The study contributes to the existing research on SDGs by showing how SDGs are becoming integrated into city management practices and how this affects the interpretive scheme (see Schütz, 1972) – i.e. the perceptions and value emphasis – of the city administration. Through this, our research contributes to the discussion about the construction of institutional performance in the public sector (Modell, 2022). While we do not utilize institutional theory here explicitly, we consider the institutionalization process of a performance perspective. We contribute to Modell’s research proposition to connect to the “sociology of valuation” (p. 360) by utilizing Power’s (2015) framework to offer “a more holistic and dynamic perspective on how [performance measurement and management] practices are implicated in the shaping of institutional fields over time” (Modell, 2022, p. 353). The study empirically demonstrates how the SDGs were utilized in the cities: to elaborate sustainable development as a performance object, orchestrate actions to account for performance based on collectively construed views, integrate new accounts as part of the managerial practices, and thereby contribute to the formation of the interpretive scheme for the city administration.

The study is structured as follows. The next section provides the background, describing the evolution leading to the adoption of SDGs and VLRs in accounting, strategic planning and management at the local level. The same section also introduces a theoretical fourfold schema that we relate to emerging accounts on sustainability. The third section outlines the research approach and methodology, explaining the cases and institutional context in which they are situated, while the fourth section presents the key findings. The final parts offer the discussion and the conclusion.

Local-level implementation of global sustainable development policy can be traced back to the establishment of the UN Center for Human Settlements in 1976. “Our Common Future,” published by the UN in 1987, later known as the “Brundtland Report,” which provided a broad definition of sustainable development as a concept that is nowadays widely applied, is described as a landmark event in mainstreaming sustainable development in the global policy arena (Mensah, 2019). The Brundtland Report emphasized local solutions to addressing global problems. At the UN Earth Summit in 1992, 178 countries adopted Agenda21 as a comprehensive plan of action to steer global sustainable development to the year 2000. Agenda21 included the idea of implementation on the local government level. The Millennium Development Goals (MDGs) adopted in 2000 were primarily targeted at halting the most pressing global societal and environmental problems mainly in developing countries by the year 2015.

The 17 SDGs were developed at the UN Conference in 2012 and adopted in 2015 as part of “Transforming our world: the 2030 Agenda for Sustainable Development” at the UN Sustainable Development Summit. Agenda2030 placed a strong emphasis on cities and municipalities from the beginning. The UN-Habitat Program established in 2002, which followed the UN Center for Human Settlements, assumed an active role in the promotion of Agenda2030 at the local level. According to Schraven et al. (2021), mirroring these developments, several labels such as “sustainable city,” “green city,” “eco-city,” and “resilient city” have been adopted, shaping the field and emphasizing sustainable development as a policy objective in local governance. Sustainability also became a way to stand out: City sustainability performance is increasingly compared through various indexes and rankings (e.g. Dall, 2020). These parallel and cascading ramifications created a new supranational event window where local sustainable development “acquired normative force and legitimacy as a policy value” (Power, 2015, p. 45), with Agenda2030 receiving far more attention and momentum than its predecessors.

In this regard, Paragraph 89 of Agenda2030 calls on all major groups, including local authorities, to report on their contribution to the implementation of Agenda2030. The UN-Habitat Program was tasked by the General Assembly to create the Global Urban Monitoring Framework (UMF) to track the progress of the SDGs at the local level. The UMF and the support programs by the UN-Habitat Program (e.g. UN-Habitat’s SDG Cities Flagship Program) formed the basis of a new sub-national evaluation format, VLRs, which allows local administrations to report their contributions to the implementation of Agenda2030 and promotion of SDGs. Cities and regions can submit their reviews to the UN Department of Economic and Social Affairs (UN DESA). However, VLRs are voluntary and do not currently hold any official status but present a novel tool for cities to understand and demonstrate their progress on SDGs.

Although SDGs have a global character, they offer flexibility in local adoption. However, they do not provide guidance on how the goals relate to one another, which targets should be prioritized, or how trade-offs between different targets should be addressed nor do they describe change paths or mechanisms (Bebbington and Unerman, 2018). Cities have significant autonomy in determining how they localize, develop and implement SDG targets. SDGs can be used as a point of departure for the formulation of local strategic goals but also as a reference framework to assess the alignment of local strategies with global goals (Guarini et al., 2021). The dynamic interplay between local priorities and SDGs as a global framework can be captured through the concept of glocalization: Being developed at the supranational level, the framework can foster worldwide harmonization and comparability yet reflect both local specificity and international universalities during the adaptation process (cf. Baskerville and Grossi, 2019). Glocalization as a complex metaphor of global processes that intertwine global and local elements together (Drori et al., 2014) highlights the idea of thinking globally, but acting locally, and it is promoted in sustainable development policy discourse. In the early phases of the development of novel accounts, at the local level “groups cooperating without consensus go back and forth between both forms of object … vague and specific” (Star, 2010, p. 605; see Power, 2015, p. 44). In the case of Agenda2030, this also describes the interaction between the global and local as groups consider the various dimensions of the performance object. This is further elaborated in the Section 2.2.

Power (2015) has introduced a fourfold development schema of policy object formation, object elaboration, activity orchestration and practice stabilization to “unfold the conditions under which new accounting systems begin and the unfolding dynamics by which vague performance objects become operational.” These four phases forming the “accounting event window,” in which new accountings can emerge, are not only sequential and cumulative, but interdependent and dynamic developments where the objects themselves are performative and continuously shaped in complex interactions between situated actors, practices and infrastructures and their respective institutional settings. This means that Power’s development schema should not be interpreted as a chronological story of how new accounts emerge but rather as a continuous and interwoven process from which new cycles of accounting change can emerge. According to Power (2015, p. 53), “contingent variation in the way these phases play out may explain differences in the durability and nature of accounting systems.”

In this study, we consider sustainable development as a performance object. Power (2015, p. 44) describes the nature of a performance object as a boundary object (Star, 2010), as it is “[…] essentially flexible in its interpretation but must also be made specific by the work of [context-specific actors], specifically via the iterative development of a [accounting template].” Interpreting Power (2015), this iterative development and specification happens through the performance object (cf. sustainable development), policy object (cf. Agenda2030; cf. SDGs) and accounting object(s) (cf. VLR; cf. specific metrics or evaluations, e.g. CO₂ emissions). Figure 1 depicts a deconstruction of Power’s (2015) framework, i.e. the reduction of the framework to its constituent parts to reinterpret it.

Policy object formation starts with the problematization of the current state and involves “the clustering of related discourses, often across and shared by different fields or arenas and building up over time to create pressure for reform in terms of a performance object” (Power, 2015, p. 48). Following Lebas and Euske (2007, p. 125), performance can be seen as “[…] a social construct that results from the identification and the sharing of a causal model,” which they conclude to mean that performance is “meaningful only within a decision-making context.” Thus, the performance object influences reality only when utilized in decision-making. In this sense, the performance object is the embodiment of an interpretive scheme (Schütz, 1972) that is shared by a set of decision-makers. This interpretive scheme describes desirable results, i.e. what is valued, and as such it defines what performance means in the specific context (cf. Lebas and Euske, 2007). However, to construct a shared understanding of a specific performance object, policymakers must form a policy object.

According to Davies and Lindvig (2021), policy objects are assembled differently in different contexts and are perceived as inherently plural. Multiple actors and arenas around the novel object become temporarily aligned and mutually reinforced through problematization, through which actors direct attention and activity toward the object. This provides the agency opportunities for change until a new policy object is constructed through dynamic and discursive processes and amplifications of the problem definition at the field level. The object can remain ambiguous, multiple, elusive, abstract and even unstable (Davies and Lindvig, 2021) – “sustainable development” or “sustainable city” being prime examples – but it needs to reach “the threshold of wider institutionalization” (Power, 2015). Several decades-long complex and multifaceted development trajectories have led to sustainable development emerging as a policy object of cities. Multiple high-level UN conferences, working groups, scientific publications and reports from bodies such as the Intergovernmental Panel on Climate Change (IPCC) have resulted in the alignment of arenas and objectives enabling individual organizations across sectors to exercise agency and “engage as part of the solution to the problems identified” (Bebbington and Unerman, 2018, p. 4; cf. section 2.1).

Policy object elaboration connects the field and organizational levels in practice norm creation through deliberative and elaborative processes (Power, 2015). Policy object elaboration as part of Power’s fourfold development schema for new accounts exemplifies a stage where field-level abstract policy objectives are being translated into more concrete and operationalizable accounting objects and gaining local and situation-specific meanings. Davies and Lindvig (2021) refer to the clarification of responsibilities and the codifying of the policy object. The policy object becomes an accounting object through the establishment of more clearly formulated strategic goals, targets and calculative practices through which their realization can be followed. This stage refers to the localization of SDGs for the purposes of accounting, strategic planning and management through the deliberation and elaboration of what sustainable development as a performance object means for the city.

Activity orchestration focuses on the accounting object’s role as a mediator between actors and artifacts. The phase depicts the application of the accounting object on an organizational level and recognizes the possible interconnections with the “system of central oversight” (Power, 2015). First, a template (cf. VLR; cf. accounting object) “provides a sense-making frame” for the accounting of the performance object (cf. sustainable development) and allows the visualization of the performance object it strives to reflect. According to Power, the development of a new accounting object “should be understood as constructing and projecting the [actual performance] object.” A standard template makes reporting “manageable and audible,” and it allows comparison between different reporting units. Second, Power describes how the accounting object’s content was generated and elaborated in a “controlled dialogue” between the experts who worked directly with the accounting object and a system of central oversight. This dialogue formed the norms for appropriate reporting. Lastly, Power critically notes that heterogeneity in accounting often leads to a failure of reporting. He points out that the ambiguity of the performance object can lead to the pervasion of the production of an accounting object, despite the extensive guidance of a system of central oversight.

Infrastructure and practice stabilization considers the actual use of the accounting object and the enactment of the performance object in the social reality of the organization. According to Power (2015, p. 50), “[t]he creation of new dimensions of performance and their associated facts is always radical and always requires new forms of accounting and governance.” First, the formation and development of infrastructure “is dependent on the durability of field-level institutionalization of the policy object” (Power (2015, p. 50); cf. the first two phases; cf. section 2.1). Power describes how, in the case he considered, the performance object could not become an organizational fact or a performance fact (Latour, 2005) until the policy setting, monitoring and then practice infrastructure were in place. Second, new infrastructure rises from the needs or demands for new perceptions, e.g. from the need to perceive sustainable development, on the organizational level. This need can arise from the organization’s institutional environment or through the demands of the organization’s decision-makers to scrutinize aspects that have not been accounted for previously. A new performance object needs to be incorporated into organizational processes and information systems as an accounting object, which brings about social change (cf. the activity orchestration phase). Third, the stability of practices is produced through “roles, rules, routines and governance structures,” i.e. “infrastructure,” that is focused on the construction of the accounting object (cf. the performance object). The decisive organizational change arises from this social infrastructure not from the accounting object itself (Power, 2015).

In addition to depicting the phase, Power (2015, p. 51) makes three “generic propositions about the effects of infrastructure accretion […] as an agenda for further empirical exploration,” which are:

1. The specific form and content of new accounting statements [are] likely to be more fragile than the infrastructures they give rise to. [ …]

2. The importance of accounting to processes of subjectivization increases with the accretion of infrastructure. [ …]

3. As infrastructure accretes, it creates routines which shorten organizational time horizons.

The duality of social structures and agency is evident in the phase of practice stabilization as structures guide activities and activities restructure the structures (e.g. Giddens, 1984), although this duality can be seen in all four interwoven phases. Orlikowski (2000) presents how, in different organizations, a new technological object or instrument can be understood and used in various ways and, therefore, enacted in various ways: the implications for reality are different. Enactment of the object brings the object to life and, therefore, affirms or changes the observable social structures. As Sin (2014, p. 437) states, the “policy object does not have an objective existence as an entity or artefact until it finds expression in actual enactment and embedded practices.” Here, the inter- and intra-organizational social processes and dynamics are of interest.

To explore how new accounts on SDGs are adopted, introduced and deployed in local governments, this study used a holistic qualitative multiple-case study design (Yin, 2018), i.e. multiple similar bounded cases are examined. While the case study strategy can be utilized for various purposes (Eisenhardt, 1989), in this paper, we intend to provide a description of the integration of the SDG agenda across municipalities. More specifically, we focused on the ongoing process in the cities in Finland to unveil the common features of the adoption of the SDG agenda, primarily seeking to capture general trends and patterns that can contribute to the general relevance of the findings (Gomm et al., 2000). The cases were purposefully selected. Using the Network of Strategic Management of SDGs in Cities (hereafter, “the Network”) coordinated by Kuntaliitto as a starting point, we focused on the six largest cities of Finland involved in the Network. The populations of the cities of Helsinki, Espoo, Tampere, Vantaa, Turku and Oulu vary from 195,000 to 658,000. The participants were at different development phases concerning VLR and SDG reporting. The city of Helsinki published VLRs in 2019 and 2021 (respectively, Espoo 2020; Turku 2020; 2022; Vantaa 2021; Tampere 2022), while the city of Oulu was still in the planning of its first VLR when this research was conducted. In Oulu, the VLR was discussed by the executive management board that initially decided on drafting the first VLR, but later they decided to postpone the process and refocused efforts on integrating SDGs into the management accounts. Helsinki, Espoo and Vantaa intend to report a VLR biannually, Turku in tandem with the strategic cycle (every four years), while Tampere intends to report next time in tandem with the national report in 2025.

From October 2022 to March 2023, we conducted semi-structured interviews with key individuals involved in SDGs, Agenda2030 and VLR processes in six cities. Due to the distinct nature of this work across cities, we utilized the snowball sampling approach by asking interviewees to suggest other potential informants. We started snowballing from the cities’ representatives (“SDG coordinators”) who participated in the Network. We then compared and discussed these referrals to see which individuals we should interview. In 19 interviews, we interviewed 22 individuals from the six cities (see  Appendix 1). The interviews lasted around one hour and were conducted by Microsoft Teams in a format of both individual and group interviews. We then transcribed the records verbatim. Along with the interviews, we conducted participatory observations by taking part in two meetings of the Network. During these meetings, one of the researchers made detailed notes on the discussions among the participants.

Furthermore, we collected key documents including VLR reports, city strategies (2021–2025; 2022–2025), annual reports (2021; 2022), budget plans (2023) and other materials including press releases and public statements to capture how the cities had integrated SDGs into their disclosures. By combining different sources and types of data, we aimed to enhance the validity of our observations and create a more in-depth picture of the research problem (Fusch et al., 2018).

In this study, the analysis was conducted holistically, drawing conclusions from the interviews and documents as a whole and through cross-case examination (see Yin, 2018). We sought to uncover the focal dynamics and processes of how accounting for SDGs began in the six cities and utilized rough coding by manually marking parts of interview transcripts by considering which phase of Power’s (2015) framework they depicted. In the case study approach, researchers can look for observable characteristics, e.g. based on a theoretical framework (cf. section 2.2 and Figure 1), but it is not unusual for key variables to emerge during data collection (Becker et al., 2005), which we considered (cf. Figure 2).

In the document analysis, we utilized interpretation and word search. In documents other than VLRs, we searched for the terms “SDG,” “Sustainable Development Goals,” “Global goals,” “Agenda 2030,” “Agenda2030,” “sustainability,” “responsibility,” “Voluntary Local Review,” “VLR” and their Finnish counterparts. When a searched-for term was found, we interpreted the context and meaning. We defined the analysis dimensions for each document type to make the document analysis manageable and comparable. In city strategies, we focused on how sustainability and/or SDGs were considered concerning the general overview and the stated vision, values and goals. In budget plans, we focused on how sustainability and/or SDGs were considered in general, in set goals for the city, by administrative branches, and in goals set for subsidiaries. In financial statements, the focus was the same as in budget plans, but the annual report was also considered. In VLRs, we focused on the structure of the document and how the information was presented. A summary of the document analysis is presented in Table 1 and more detailed analysis notes are in  Appendix 2.

We utilized hermeneutic analysis in which we transformed our understanding of the parts and the whole through iterative recontextualization (e.g. George, 2021). This happened through recurring research team meetings where we discussed the data and our interpretations of it. This was facilitated by considering one of the framework’s phases per meeting discussion. Before the meetings, we oriented ourselves by gathering our own initial understandings of the phase from the data while reflecting on the theoretical framework (cf. contextualization). In the meetings, we discussed our ideas and gained new understandings (cf. recontextualization). This formed our recurring hermeneutic circle. In addition, we continued discussions among researchers during the writing and finalization of this study, thus continuing the hermeneutic recontextualization.

Policy formation was related to the establishment of the role of the local level action as part of Agenda2030, and it was entangled with longstanding historical trajectories related to the environmental and social responsibilities of cities. Our focus, however, was on policy formation through the creation of supranational networks around the new policy object, Agenda2030. Instead of steering from the central government, our data pointed out a mesh of complex networks and interactions that led to the adoption of Agenda2030 as a policy object at the local level. The six cities were all active in several international and national networks and operated directly in the global arena by participating in high-level UN political forums and having bilateral relationships with cities outside Finland. By linking cities to the state-level implementation of Agenda2030 through the representation of cities in the National Commission on Sustainable Development, Kuntaliitto was noted to have an active role in constructing and promoting Agenda2030 and SDGs as a local-level policy object:

Helsinki as the capital was especially active in the international arena. Helsinki signed the VLR Declaration launched by New York City at the UN General Assembly in September 2019, in which the City expressed its commitment to Agenda2030. In the spirit of New York, the mayor of Helsinki challenged the Finnish cities to follow Helsinki and commit to advancing Agenda2030 and SDGs. This was described by the interviewees from other cities as one of the landmark events in Agenda2030 acquiring legitimacy and broader political interest in the policy landscape of local governments.

To exemplify their commitment to Agenda2030, in 2022, the six cities released a “Declaration by Finland’s six largest cities on the promotion of the national sustainable development road map.” The declaration, signed by the mayors of the six cities, states that the cities commit “to promoting the goals for the areas of change outlined in the national sustainable development roadmap in accordance with the cities’ strategic priorities,” putting emphasis on the localization of both global and national-level policy goals.

Sustainable development as a performance object was considered highly abstract, and, according to the interviewees, it was understood in various ways. The lack of a shared understanding of what issues should be associated with sustainable development and how economic, social and ecological dimensions should be prioritized and their interconnections understood was described as a starting point to the process of bringing SDGs into the organizational reality of the cities, as the extract from the interview data points out:

SDGs were depicted as a way to capture the multidimensional and plural nature of sustainable development as a performance object. The interviewees felt that SDGs could broaden the current understanding of sustainable development that was primarily focused on environmental issues, such as climate change mitigation and environmental protection.

The following extract from the interview data describes how SDGs could provide a common language through which sustainable development as a performance object could be elaborated in a way that would allow various actors to connect their activities with the performance object. In this way, the SDG framework worked as an interpretive scheme reflecting the performance object.

While SDGs offered opportunities for potential accounting objects (e.g. CO₂ emissions), they mainly worked as thematical policy objects that allowed context-specific interpretations and the formation of new accounting objects. The process of elaborating sustainable development as a performance object through SDGs in the cities took place both at the field and organizational levels. The Sustainable Cities Program run by the Ministry of the Environment sought to develop ways in which cities could measure their progress in terms of sustainable development. In the Network, the cities jointly developed “a strategic sensemaking tool for SDGs,” the SDG Analysis Process. The tool outlined an interactive workshop method for SDG “sensemaking” through the selection of the most important, supportive and at-risk SDGs on any given topic and the creation of more specific targets for each (SDG Analysis Process: Handbook, 2022). Through participatory observation, we witnessed the attempt of the representatives of the six cities to collectively make sense of how and through what kind of methods SDGs should be localized.

Although the cities formally committed to a global-level agenda, in practice, local priorities shaped the situated understandings of sustainability. In the declaration by Finland’s six largest cities on the promotion of the national sustainable development road map, the cities committed to the policy object of Agenda2030 “in accordance with their own local strategic priorities.” At the organizational level, the adaptation of SDGs to local strategic priorities involved the use of these jointly developed structured methods and tools, deliberation and the consultation of various stakeholders. The SDGs were localized through different strategic focus areas, such as health and welfare, culture and education, carbon neutrality and reducing inequalities. The cities displayed variance in local strategic focus areas, which impacted the construction of future visions and actions required in achieving them. The following citation describes why, while many approaches and tools used in object elaboration were shared between the six cities, the results of the process varied based on local prioritizations:

The document analysis and interviews revealed that all the cities that had published a VLR addressed Agenda2030 also in their strategy (see Table 1;  Appendix 2). Helsinki, Espoo and Turku declared in their strategy documents their overall commitment to Agenda2030 and SDGs and, in their VLRs, they emphasized the importance of city strategy and policy programs in achieving the SDGs, whereas Tampere and Vantaa connected the focus points of the city strategy to SDGs, presenting what SDGs each strategic focus area considers. Consequently, sustainable development as a performance object became projected mainly through existing performance measurements developed to track the local strategic goals.

VLRs were adopted by the cities as an accounting template that allowed the cities to elaborate on sustainable development. The VLR as a device to track the development of performance also meant that cities, in addition to utilizing the strategic indicators they connected with SDGs, often needed to search for new indicators and measurements to fill in the areas that previously had not been accounted for. A wide array of external sources was used in search of additional indicators fit for local needs. Some of the cities had taken part in the JRC URBAN2030 project, which focused on the local monitoring of the SDGs. Through the European Handbook for SDG Voluntary Local Reviews published by JRC URBAN2030, the cities could access a wide set of potential indicators and see which indicators were appropriate in their own context and strategic goals. In this way, VLRs facilitated the compilation of different accounting objects that could be linked with SDGs and allowed cities to create projections of their state and progress in relation to sustainable development as a performance object, although the accounting objects were not necessarily created to project sustainable development. Through the choice of indicators, the cities engaged in the elaboration of the performance object, i.e. in the construction of the local interpretive scheme. While the VLR and/or SDGs, as an accounting template did not direct the process of object elaboration, it did facilitate and frame the process.

In addition to sparking object elaboration, the VLR as an accounting template facilitated activity orchestration and “contingently linked together and translated programmatic and conceptual demands into feasible workstreams in organizations” (Power, 2015, p. 49), allowing actors to visualize the abstract and multidimensional performance object through a structured process. In all the cities, “understanding where we are at the moment” and “making what we already are doing visible,” as the interviewees put it, were important starting points for the exploration of SDGs as a new interpretive scheme. In most of the cities, the use of these new tools was operationalized in pilot attempts to scan the SDG linkages of the strategic documents, selected programs and spearhead projects thematically intertwined with SDGs. These exercises, often mainly part of the internal work within the city organizations, helped the cities to get a hold of their current state and explore the managerial implications of the performance object, paving the way for the initiation of the VLR process and broader integration of SDG accounts as part of the management of the city:

The generation of the content of the VLR was orchestrated through internal working groups within the city organizations, composed of various “active individuals,” as one of the interviewees described the participants. Typically, the working groups were composed of sustainability and climate specialists and coordinators, strategic managers, professionals in ownership steering and branch or company managers. The working groups engaged in a controlled dialogue between the various branches of cities and the central management to generate the content for the VLR reports. Especially, the sustainability coordinators, as participants in global and national networks, played crucial roles in connecting the field and organizational levels in the creation of practice norms, building internal capabilities and introducing innovative ideas for the construction of performance objectives and operationalizing VLRs. Despite the active participation of many mayors, however, several informants reported encountering difficulties in disseminating the concept throughout the entire city organization. Hence, the working group members conducted advocacy work by “spreading the gospel” of SDGs (interviewee) to other cities and inside their own city to make SDGs and VLRs better known across the organization.

The information gathering organized by the working groups coordinating the VLR process set in motion processes to identify and account for SDGs in branches and municipally owned corporations. Dialogue between central coordination and the branches and companies was reported. However, instead of central oversight, each branch and municipally owned corporation underwent internal sensemaking processes and generated situated understandings of the performance object and how their activities were linked with the performance object. This allowed subjectivist interpretations of the performance object to prevail in the production of accounting and shaped the content of VLRs as bundles of heterogeneous accounting objects directed by sectoral rationales and interpretations of sustainability. As one interviewee noted, “I think it is very difficult to see us [the city] as an organization. It is more like some key people getting their ideas from certain places.” The observation reflects the cumulative nature of the process, whereby individuals at different levels of the organization aggregated information to produce joint accounts of their collective performance. While formal oversight mechanisms had not been established, the interactions represented the “possibility of beginning to practice” (cf. Power, 2015).

The informants suggested that the VLR and SDGs have managerial implications. The VLR and SDG reporting, and related social processes, are used to build interpretive schemes primarily for managers and decision-makers.

The managerial role of the new SDG accounts and the VLR differed among the cities (cf. section 4.2 and  Appendix 2). Key people and individuals in different cities perceived and utilized SDGs differently and with different weights. While the SDGs and the VLR were considered in relation to strategy, on the one hand, some interviewees perceived that the city strategy drove sustainability as is and, because of that, the hypothetical added emphasis on SDGs was seen as an artificial “marketing” activity by some interviewees. On the other hand, some perceived the need to connect local thinking and actions to the international framework and therefore connected the city’s strategic aims directly and visibly to SDGs, which also connects other management documents, such as the budget and annual report, to SDGs. Second, practice stabilization was at an early phase, which allowed different solutions and applications of VLR and SDGs, as well as new accounts for multiple purposes. While there are guides, handbooks and supporting networks, there were no strict rules on how to use the VLR or SDGs. As voluntary accounts, cities can decide to utilize them in any way they want or decide not to use them at all – the possibilities of variance are limitless.

While the VLR and SDGs had different roles in different cities’ accounting infrastructures (document structures), SDGs implementation in the city strategy might depend on the administrative structure of the city and, especially, where the professional[s] focusing on VLR were located in the organization. Being located in or having a strong connection with the strategy unit of the city’s central administration might give the strongest opportunity for the strategic use of SDGs. The city strategy would connect SDGs institutionally and procedurally to budgeting and annual reporting, which would further accrete the infrastructures of SDG accounting. The importance of the concrete connection of SDGs to city strategy in the accretion and influence of SDG considerations can be perceived in the following.

The SDGs also concerned city-owned companies. For example, in Tampere, as the city strategy was bound to SDGs, SDGs were described as being under continuous discussion with the city-owned companies. Some companies reported on SDGs annually or even quarterly to the administration of the City. Tampere intended to include sustainability reporting requirements in the City Group code of practice, which could further require companies to report on SDGs. In Helsinki, while SDGs were not strictly embedded in the city strategy, the city urged the companies to consider SDGs in their reporting. In Turku, the companies themselves discussed with the city’s central administration about getting involved in the SDG processes. SDGs were used as a base to build infrastructure for sustainable development in city groups:

Some interviewees were concerned about the weak influence of SDGs in central managerial processes. The risk of the movement “dying” was mentioned because this had happened to earlier sustainability programs (cf. section 2.1). However, the utilization of SDGs was recognized to be gaining momentum, and time would tell how the infrastructure born from SDGs accretes and how SDGs’ value propositions have an influence:

In the budgets for 2023, SDGs were explicitly mentioned by four cities, mostly only briefly, even though the concept of sustainability was presented at many points in every city's budget. Helsinki and Espoo referred to the ideas of their city strategies with similar phrases as in the strategy documents. Turku’s two separate administrative branches declared in their own sections, in one sentence, their commitment or intention to implement Agenda2030s 17 SDGs in their plans. Tampere brought up the connections of the city strategy’s focus points to SDGs in a section considering the strategy and strategic management systems. In the budget, a connection was presented between the council term’s strategic goals and the SDGs. While the strategic goals were locally driven and controlled through localized indicators, the strategic focus points were thematically connected to SDGs.

The annual reports for 2021–2022 show that SDGs were not considered as a performance aspect to be informed to stakeholders, although sustainability was discussed. Only three cities mention SDGs or Agenda2030. Espoo’s reports contain similar mentions as the strategy and budget, and, in the 2021 report, a general reference is made to cross-administrative program work advancing SDGs. In Oulu’s report for 2021, education services disclose two specific activities concerning Agenda2030, while in the 2022 report, Oulu mentions that they are developing a reporting tool for UN SDGs. Turku’s 2022 report contains one city-owned company’s declaration of fostering SDGs. Table 1 presents the summary of the document analysis. More detailed information is presented in  Appendix 2.

City authorities face increasing pressure to counter global sustainability challenges and play an active part in implementing global and national policies, as well as managing local-level action for SDGs. By exploring the making of SDG accounts in the six cities through a multiple case study approach, we respond to the calls by Kaur and Lodhia (2019) for more research that explains how public-sector organizations address SDGs and by Modell (2022) for research discussing the sociology of valuation in connection with the institutionalization of performance in the public sector. More specifically, by focusing on the dynamics and processes, we capture empirically how accounting for the global sustainability agenda begins in cities.

Figure 2 presents a summary of the key results. Object formation, object elaboration, activity orchestration and practice and infrastructure stabilization all relate to the interaction between the global and local, the process of glocalization, as the performance object, the policy object and the accounting object are processed in parallel in the making of new accounts. Agenda2030 as a global policy object gained situation-specific and local meaning through the deliberation and elaboration of what sustainable development as a local-level performance object means for the cities, and how the cities could contribute to the global agenda. The VLR as a process and a common and globally recognized accounting template framed the object elaboration and activity orchestration and allowed the actors to connect their activities with global sustainability and reinforce the perception of cities as new types of subjects that actively promote and demonstrate accountability in global sustainability challenges not only locally, but in the global arena (see Bebbington and Unerman, 2018).

While SDGs as an interpretive scheme allowed a joint elaboration of sustainable development as a local-level performance object against global goals, we highlight new accounts that were shaped by the availability of information, organizational structure, institutionalized practices, local political priorities and resource constraints. Our data display a similar approach as reported by Guarini et al. (2022) in Italy – cities use SDGs as an overreaching theme in strategic planning or as a reference framework to link the existing strategies and political priorities with sustainable development programs, but not as a point of departure.

Our results show that the VLR facilitates a compilation of bundles of accounting objects that often relate to the pre-existing policy objects or performance objects of the city through which SDGs can be depicted. This can be problematic because the development of an accounting object “should be understood as constructing and projecting the [actual performance] object,” (Power, 2015, p. 49) as accounting objects can align activities away or toward the intended performance. The (mis)alignment of the accounting objects, policy objects, and performance objects should be carefully considered. Without alignment, sustainability accounts suffer from the broken telephone game effect – they can get diluted and twisted in organizational reality when they are localized, again hindering their role in instigating institutional change beyond a change in accounting practices.

The interviewees emphasized that for the SDG accounts to support the cities in pursuing more sustainable futures, they need to be integrated into the strategies and managerial practices. Across all six cities, practice stabilization was at an early phase and the practices varied among the cities; however, SDG accounting seemed to be developing a positive momentum. As Guarini et al. (2022) noted, without the integration of these new accounts into routine managerial practices, they have very little influence on the way in which cities function. Nevertheless, the cases display how SDGs are used in accreting infrastructure that allows cities to track and manage their progress on sustainable development.

Power (2015) offered three propositions about the effects of infrastructure accretion. According to our data, Power’s first proposition that “the specific form and content of new accounting statements is likely to be more fragile than the infrastructures they give rise to” seems valid (cf.  Appendix 2: VLR). While infrastructure has accreted, the relation of SDG accounts with various cities’ strategies seems to be evolving, along with the relation to budget and reports, and there already is variance between a city’s VLRs (see  Appendix 2: Helsinki; Turku). According to Power’s second proposition, accounting becomes more influential as infrastructure accretes. According to our results, this seems valid concerning SDGs and sustainability. Infrastructure accretion enables the further fostering of sustainability accounting in city organizations beyond Agenda2030 and SDGs and, thus, makes the performance object of sustainability better known and more valued. Concerning the third proposition, based on our results, there is no evidence of shortening the VLR reporting cycle through infrastructure accretion; however, the interviewees emphasized that SDG accounting would be more frequent when connected to financial reporting processes, bringing the sustainability perspective cyclically in line with financial accounting. Our results indicate the further accretion of SDG accounting infrastructure in the future and, thus, further progress in line with Power’s propositions. We see no signs of the movement dying.

The current study includes certain limitations. The first arises from the use of a case study approach and pertains to the challenge of generalizing findings from the selected cases. To address this concern, we utilized theory building, as suggested by Power (2015, p. 44) and analyzed multiple cases focusing on the processes of the integration of the SDG agenda across municipalities. Analyzing a range of cities within a single national context, we were able to capture the common features of the adoption of the SDG agenda, thus arguing for some general relevance of the findings (Gomm et al., 2000). Another limitation of the study relates to the contextual influences that are inherent in the Finnish setting from which the cases were drawn. We recognize that the findings of the study are influenced by the contextual features of Finland. Thus, conducting research in other empirical settings, e.g. with different administrative systems and less autonomous local governments, might capture a different perspective on how the integration of the global sustainability agenda unfolds at the local level.

We explored the process of how accounting for Agenda2030 and SDGs begins in the six city administrations in Finland by following Power’s fourfold development schema of policy object formation, object elaboration, activity orchestration and practice stabilization. Our results show how SDG accounting began through global and local-level interactions that led to cities committing to sustainable development and Agenda2030 as a policy object. The SDG framework worked as an interpretive scheme through which the cities glocalized sustainable development as a novel, simultaneously global and local, performance object.

This study contributes to the existing research on SDGs by providing an extensive and explicit connection between the implementation of the global Agenda2030 to the city level and offering a novel view of this process as the glocalization of an interpretive scheme. In this vein, the current work provides an additional contribution to the accounting literature on SDGs by explaining SDG accounting as a social infrastructure that serves to build and maintain a socially constructed view of the performance of sustainable development. The study shows empirically how this interpretive scheme is built in cities by elaborating sustainable development as a performance object, orchestrating actions to account for performance based on collectively construed views and by seeking to integrate new accounts as part of the managerial practices of city administrations and, thus, contributes to the understanding about the institutionalization of a performance perspective in the public sector.

The study offers some implications for practitioners, as it elaborates on the social and institutional dynamics and processes of how accounting for SDGs begins, and how they shape the performance and accounting objects themselves. Integration of the new accounts in managerial practices is necessary for these accounts to take life in steering the actions. Cities can strengthen SDGs’ managerial impact by fostering dialogue among different stakeholders and by embedding SDGs into the strategic and financial management of the city, thus accreting SDG accounting infrastructure. This can be encouraged by: (1) locating SDG coordinators in the strategic management unit of the city’s central administration; (2) connecting SDGs in the city’s strategic goals and, thus, in budget and annual reports; (3) considering the city group code of practice to promote SDG accounting in city-owned companies; (4) introducing SDGs in the procurement code of conduct; and (5) supporting intra- and interorganizational networking of SDG coordinators and SDG work. This shapes the city administration’s perception, i.e. interpretive scheme, of and toward sustainability. We perceive this as the purpose and intention of Agenda2030 and SDGs. By contrast, if SDGs are not used in this way, SDGs do not contribute to the accretion of infrastructure concerning the performance object of sustainability.

We would like to highlight three propositions for future research. Our cases displayed variance in the adoption of SDG accounts and VLRs in terms of motivations, approaches in compiling the reports, content and the level of integration and interconnections with strategic planning and management, which subsequent studies could further explore in similar and different contexts. Second, integration and practice stabilization are anticipated to enhance the influence of SDGs, yet local priorities and management structures shape the way objects are construed and may create misalignment between the performance object, policy object and accounting objects that project the performance object. These dynamics could be further explored in future studies. Lastly, future research should pay attention to complex social processes and dynamics in the institutionalization of sustainability performance and focus on issues such as power dynamics in institutionalization processes, resistance to institutional change and the way prevailing practices shape the adaptation of a new practice. These factors may hinder the capacity of new accounts to live up to their promises. Thus, building an understanding of these issues may enhance capabilities to manage change.

We would like to acknowledge the contributions of all individuals and organizations involved in this research paper: the interviewees and organizers from Kuntaliitto’s network Strategic Management of SDGs in Cities; the cities themselves; the JPBAFM special issue guest editorial committee, the anonymous reviewers, the participants of the workshop held in November 2022; participants in the panel “11. Datasta merkityksiin julkisessa hallinnossa” at the HKTP-conference in Kuopio, Finland, 2022; Professor Jarmo Vakkuri for his invaluable insights and comments along the way.

All authors contributed equally to the article.

Table A1 

Table A2