Sustainable innovation and the triple bottom-line: a market-based capabilities and stakeholder perspective

Firms are creating sustainable innovations in response to customers and other stakeholders. Yet little is known about the capabilities required, as well as whether these innovations produce the touted people, planet, and profit – or triple bottom-line – rewards. Through the lens of market-based capabilities and stakeholder theories and based on a survey of firms working on sustainable innovations, this study determines the capabilities of market-based sustainability and organizational learning propel sustainable innovation, contingent on public ownership and organizational unlearning. We also find sustainable innovation contributes to the triple bottom-line by enhancing firms’ environmental performance and social performance, and in turn economic performance.