Developing Sustainable Innovations for Planet, Profits—And People: Mixed‐Methods Insights From the Textile Industry

ABSTRACT Sustainable innovations are increasingly recognized as promising avenues for businesses to tackle global sustainability challenges, expected to deliver ecological, social, and economic benefits. Yet social outcomes at the individual level remain underexplored, raising questions about whether such innovations fully realize their sustainability potential. This study investigates whether and how sustainable innovations create multifaceted value and examines employee participation as a critical driver of these outcomes. We employ a mixed‐methods approach, combining longitudinal data from 15 textile factories collected in multiple survey waves over up to 20 months with qualitative insights drawn from open‐ended survey responses. Multilevel modeling analyses at the company and person level indicate that perceived innovation success is positively associated with organizational performance perceptions, employee well‐being and optimism. Mediation analyses suggest that employee participation contributes to these outcomes indirectly by increasing perceived innovation success. Complementary qualitative analyses, guided by a principally inductive approach, reveal how employees perceive the benefits of sustainable innovations across economic, environmental, and social dimensions at individual, organizational, and societal levels. Overall, the study underscores sustainable innovations' often‐overlooked social benefits and shows that participatory implementation can amplify sustainable innovations' transformative potential for inclusive, future‐oriented development.