Sustainable business models for advancing system-level sustainability

Abstract

Sustainability challenges call for changes at different levels and scales, and actions by all sectors of society, including business. Prior research has identified the central role corporate strategies, innovations, and business models play in the move towards sustainability. In recent years, the focus of corporate sustainability literature has extended from minimising the negative impacts to a more strategic view of how companies can create a positive impact on the environment and societies. However, the adoption of truly sustainable business practices and the evidence of the progress made towards sustainable development remain limited. This study integrates the views from the literature fields of the traditional business model, corporate sustainability, and system transition, and focuses on advancing system-level sustainability through sustainable business models.

This study concerns the bidirectional interaction between companies and the larger systems in which they operate. The study investigates companies’ impact on system-level sustainability through the sustainable business model, and especially through sustainable value creation. It also examines how the system supports or hinders the adoption of sustainable value creation activities at company level. The study employed exploratory and qualitative research design by applying multiple research strategies and methods. The study was conducted through literature reviews, a multiple case study covering 20 companies, a Delphi study with 42 experts, a single in-depth case study, and design science research including multiple steps and covering an analysis of 20 sustainable business models and observations, interviews, and feedback from 34 attendees who participated in framework testing.

This study contributes to the sustainable business model literature by demonstrating that sustainable value creation, as a central element of a sustainable business model, is a vehicle through which companies have the potential to create sustainable business, and that advance system-level sustainability, and the understanding of value capture logic is a necessary driver for companies to engage in sustainable value creation. The study introduces frameworks and tools to create an understanding of the multifaceted nature of sustainable value creation and value capture potential. Further, the findings of the study highlight the role of both radical business model innovations and minor business model changes in advancing sustainability. This study also contributes to the sustainability transition literature by addressing the bidirectional interaction between company and system levels. Companies play a central role in sustainability transition, but the adoption of sustainable business models requires system-level support.