Engaging Stakeholders in Innovation for Environmental Sustainability: A Capability-Based Framework

Innovation presents an opportunity for firms to achieve environmental and economic outcomes simultaneously. However, this is not easy since it involves external stakeholders both along and outside the supply chain, as well as diverse internal teams. Through systematic synthesis of 97 papers representing the diverse literature, a framework is developed that applies a capability perspective to how firms engage with their stakeholders for sustainability innovation. The resulting framework extends prior resource-based product development work by elaborating the dimensions of integrative capabilities, evidencing additional higher order capabilities of value frame management and organizational learning, and adding sustainability as a functional capability. The framework and associated propositions synthesize current knowledge on the capabilities organizations require to engage stakeholders in sustainability innovation. The review suggests that a firm’s sustainability, innovation and marketing functions not only...