Transition pathways of coal mining and coal-based power generation industries

This research investigates the strategic directions of a sunset industry sector, coal-based power. Drawing on the literature on sustainable business model innovation (SBMI), dynamic capabilities, and transition pathways, we take an exploratory approach to analyze how large coal-based businesses are developing transition pathways to reduce their environmental footprints. Analysis of secondary data on the environmental performance of 167 large companies over the period 2014–2023 is followed by an in-depth strategic analysis of five coal mining companies and five coal-based power generation companies to derive insights. The results show that leading firms in downstream businesses, specifically those involved in coal-based power generation, have identified superior transition pathways than their upstream counterparts in coal mining. We attempt to explain the phenomenon through the lens of institutional role in transition, dynamic capabilities, leveraging organizational slack, and structural limitations in pursuing SBMI. Consequently, the synthesis recommends a pragmatic approach to the fossil fuel industry for finding transition pathways. The research provides novel empirical evidence on the transition pathways of fossil fuel industries, contributes to theoretical concepts of business model innovation, and offers actionable insights for practice.