Corporate Sustainability Transformation: Exploring the Role of Knowledge Transfer in Business Model Portfolios

With rising pressure to become more sustainable, established firms increasingly seek to transform prevailing practices and implement sustainable business models. Managers find it difficult to achieve this transition, often lacking the capabilities needed to effectively respond to changes in the business environment. Through a qualitative in‐depth case study, using retrospective and longitudinal data, this study explores the transition from a single business model to a portfolio that includes sustainable business models. The findings show that business model portfolios can create an environment for knowledge transfer, particularly at the corporate level, which improves the organizational capabilities. The analysis further revealed two individual‐level components related to the source and recipient of knowledge that influence the transfer of knowledge. The study contributes to the literature by linking business model diversification and corporate sustainability transformation, demonstrating the central role of knowledge transfer in nurturing the capabilities needed in firm‐level sustainability transitions.