Chapter 5: Sustainable Innovation

Definition of Sustainable Innovation

What is meant by sustainable innovation? Sustainability is the capacity to endure in a relatively ongoing way.  Sustainable innovation means that companies seek out ways in which to sustain continuous innovation/improvement for company growth, competitive advantage, increased market share, etc. The right company structure can help make innovation a sustainable practice. Organizations cannot afford to put resources (time, people, money) into innovating only to have these innovations fail.  Companies structure for innovation to help sustain, or maintain, ongoing innovation in an effort to stay competitive in their markets. Allocating resources appropriately, ensuring feasibility, and reporting a return on investment are important steps in creating a sustainable innovative business environment.

The term sustainability is also used to refer to environmental sustainability.  Environmental sustainability focuses on acting in a way that ensures future generations have the natural resources available to live an equal, if not better, way of life as current generations. Many innovations today are focused on solving environmental issues. The Sustainable Development Goals (SDGs) of the United Nations are broad and ambitious, calling on all countries – be they upper, middle, or low income – to make tangible improvements to the lives of their citizens. The ‌goals (shown below) ‌encompass social, environmental, and economic aspects.

Our world has grown increasingly complex, and it’s no longer enough for individual organizations, companies, or even governments to apply superficial fixes of their own making to chronic problems. Solutions that are not inclusive or do not consider root causes are by definition short-sighted. Short-sighted solutions may not continue to work over time. Societal issues like poverty, social inequality, racial injustice, and food insecurity, to name a few, require a new kind of collaboration between the business, the nonprofit, and the government sectors.^[1]

Consumers today care about the world they live in and the people of the earth and businesses need to care as well. The term, Triple Bottom Line is often used to refer to the concept that businesses need to not only be concerned with making a profit but also be concerned about the manner in which they do so.  The three parts of the Triple Bottom Line include considering the impact that business operations and innovation have on societal, environmental, and financial well-being; in other words, people, planet, and profit (respectively).  Consumers put pressure on companies to do good; good for their customers, communities, and investors; good for the planet by reducing pollution or innovating to support the environment and communities; and after doing these things, consumers feel that it is then acceptable for the company to make a profit.  Some business leaders think this is a terrible idea often because operating a business with sustainability in mind usually increases costs.  With that said, many consumers are willing to pay a little more for pet-friendly, environment-friendly, and people-friendly products and services. You may have noticed that many innovations that are good for the environment are also good for people and therefore are supported by the people and will generate a profit for the business in the long run.

Sustainable Innovation Collaboration

The Ivey Innovation Learning Lab is a new approach to learning that builds unique insights from leading academic thinking and peer-to-peer dialogue with fellow leaders. Participants come from business, government, and academia. The Lab consortium knows that the way in which people live and work is being profoundly disrupted. The knowledge and tools of the past will not necessarily help navigate the future, nor solve the urgent and complex challenges facing society and business.

Watch the “Shaping the Future of Innovation”, Ivey Business School YouTube video below to learn about the Ivey Centre for Building Sustainable innovations.^[2] Transcript for “Shaping the Future of Innovation” Video [PDF–New Tab]. Closed captioning is available on YouTube.

Difference Between Sustainable Innovation and Traditional Innovation

Both traditional and sustainable innovation involves developing new products, services, or processes. Three core features set sustainable innovation apart.

1. Sustainable Business. Sustainable innovation intentionally aims to “meet the needs of present generations without compromising the needs of future generations.” It requires businesses to actively incorporate issues such as those defined by the United Nations Sustainability Goals. Companies that engage in sustainable innovation think long-term, about aligning with consumer demands for fair working conditions, environmentally friendly processes and products, improvements in communities, etc. These companies understand that consumers evaluate how ethical and sustainable an organization is, and base their decisions on whether or not to support a business on these evaluations.^[3]
2. Corporate Culture. Unlike traditional innovations that are mostly performed within a separate R&D department or unit, sustainable innovations are likely to be more successful when they are deeply embedded in the firm’s culture. When sustainability is not part of the corporate culture, the pursuit of short-term profits will kill sustainability-oriented creative ideas without giving them sufficient time to mature. Sustainable innovation is disruptive because it can result in better business models, improved processes, streamlined resource flows, reduced waste and cost, and create new market segments entirely, making it harder for corporations to defend the status quo.^[4]
3. Systems Thinking. Sustainable innovation is more collaborative because it is a cross-discipline concept. Companies must reach out across industries to unlock the value of sustainable innovations. It changes the corporate “value chain” to more of a “value web.” Companies consider how their innovations affect various stakeholders, the environment, and society.^[5]

Facilitating Change Through Sustainable Innovation Design

Approaches to Sustainability

The Institute for Manufacturing at the University of Cambridge crafted a chart of increasingly complex approaches to sustainability for designers.^[6]

1. Green Design. Green design is the most basic level as it describes design efforts that optimize individual aspects of product design, for example, replacing virgin plastics with recycled plastics.
2. Eco-Design. The next level is eco-design because it goes beyond single materials and focuses on the life cycle of the entire product. For example, selecting low-impact material choices, optimized manufacturing, efficient distribution, and optimized product lifetime.
3. Sustainable Product Design. This approach added aspects of social fairness to the design equation, so it is only at this point that design can be considered to address the triple bottom line.
4. Design for Sustainability. This is the point where design no longer focuses only on design for products but rather a systemic lens is being applied. Design for sustainability includes four domains: design for symbolic and visual communications, design for material objects, design of activities and organized services, and design for complex systems or environments for living, working, playing, and learning. Issues of democracy and justice are also incorporated into this lens.
5. Transformative Design. Includes all of the above and adds the design of entirely new ways of thinking about the human experience in the future. This is often achieved through creating solutions that highlight future ways of living.

Examples of Sustainable Innovations

Eco-friendly Biofuel. Through sustainable innovation, companies can invent and offer novel products or services that directly contribute to achieving sustainability. For example, Bio-bean, a British startup, developed an eco-friendly biofuel made from coffee waste to help power London’s double-decker buses. Bio-bean also upcycles spent coffee grounds into eco-friendly products such as coffee logs and coffee pellets—alternatives to carbon-heavy fuels such as coal briquettes and imported wood logs. Bio-bean is using material previously considered waste, contributing to a circular economy while generating approximately $10 million (USD) in annual revenue in 2020.^[7]

Fairly-sourced Smartphones. Sustainable innovation is not only about inventing novel products or services. Firms can also innovate sustainably while offering existing products or services when they change their processes. Process changes can occur in many areas, e.g. design, production, marketing, and even HR. For example, Fairphone, a Dutch social enterprise, offers consumers fairly-sourced smartphones. Unlike bio-bean, which created novel products (i.e., logs and pellets made out of coffee waste), Fairphone products do not have any new technical features. Instead, Fairphone dramatically changed the smartphone production process to make it more responsible and sustainable. They use recycled and responsibly mined materials and provide their workers with fair wages and good labor conditions. Because approximately 80% of the emissions of a smartphone come from its production, Fairphone designs its phones to last. They have a modular design which makes repairs and upgrades easier, thereby significantly reducing e-waste.^[8]

Smog Vacuum Cleaner. Daan Roosegaarde is the mastermind behind the world’s first smog vacuum cleaner. The Smog Free Tower measures almost 23 feet high (7 meters) and sucks in polluted air, cleaning it through a process of ionization before releasing it again. At its peak performance, the tower cleans 30,000 m3 of air per hour.  Thanks to Roosegaarde’s design, you can even wear rings made from the compressed smog particles collected from the tower. By buying and wearing a Smog Free Ring, you’re contributing to over 10,700 square feet (1000 square meters) of clean air. The project has garnered a lot of attention since its inception, winning multiple awards. Recent tower campaigns have been launched in South Korea, China, the Netherlands, Mexico, and Poland.^[9]

Solar Glass. Solar glass could change the way we create homes and commercial buildings. Researchers at the University of Michigan are developing solar glass, a sustainable engineering project that has generated a lot of buzz in recent years. Just as the name implies, solar glass would be able to capture and store solar energy. According to the research team, 5 to 7 billion square meters of usable window space exists, enough to power a full 40% of US energy needs using solar glass.^[10]

Edible Cutlery. A green alternative to plastic cutlery, Bakey’s edible alternative comes in three different flavors—plain, savory, and sweet. They’re 100% natural and will biodegrade if not consumed.^[11]

Water Capture. Some innovations are the result of using nature as a design mentor (biomimicry), for example, recent advancements in fog catchers or netting systems in arid climates help communities capture water from the morning fog and were modeled on an understanding of how the texture on the Namibian Desert Beetle’s forewings captures moisture so efficiently. The Biomimicry Institute provides learning journals that can help designers create a strong foundation for further learning. They have also created an amazing website called “Ask Nature”.^[12]

Green Buildings. Leadership in Energy and Environmental Design or LEED® is an international symbol of sustainability excellence and green building leadership. LEED’s proven and holistic approach helps virtually all building types lower carbon emissions, conserve resources, and reduce operating costs by prioritizing sustainable practices. Canada is one of the top territories in the world for LEED certification. Did you know that buildings generate nearly 30% of all greenhouse gases, and 35% of landfill waste, while consuming up to 70% of municipal water?^[13]

Sustainable design continues to evolve with new technology and understanding. Architects and designers are thinking into the future and creating buildings based on a broader concept of sustainability; one that embraces more than improved energy performance. With building design having a profound impact on the environment, its occupants, and the economy, architects and designers have a unique ability to impart real positive change.^[14]

Sustainability and innovation go hand in hand. One thing that the green building movement is achieving is that it’s challenging our community, architects, engineers, building owners, lenders, appraisers, and others, to think differently from their predecessors, or even from themselves. In less than a decade, the green building movement changed the entire building industry and manufacturing industry for construction products and equipment. With the increased demand for green and healthy materials, efficient equipment, and fixtures, green buildings became cost-effective and achievable.^[15]

Circular Economy

Modern society has become very good at creating linear systems of production, the take-make-waste process. In these systems, we extract raw materials and put them through a process of manufacturing that includes intensive material and energy input as well as a lot of transportation from one manufacturing plant to another. This is considered the upstream phase because it occurs on the way to the user. Consumers then use the products until they become obsolete which can mean everything from being no longer in style to breaking, to requiring replacement upgrades. Much of this obsolescence is actually built into the design in order to generate profits for companies, but this is a narrow way of thinking about long-term business success. Finally, once a user is done with a product, they discard it. This end-of-life phase is considered the downstream phase. This linear system results in significant damage to the natural systems that support us.  So, design for sustainability involves transforming linear thinking into cyclical thinking. In nature, there is no such thing as waste. Cyclical thinking is not merely recycling. It’s designing products to be easily disassembled in combination with designing new take-back systems and infrastructure that make it easier and less expensive for companies to collect the materials they will use in one generation of products in order to manufacture the next generation of products. This regenerative approach to design has taken many forms over the last several decades as we move towards establishing a circular economy.^[16]

The circular economy is based on the principles of designing out waste and pollution, keeping products and materials in use, and regenerating natural systems. There is a lot of waste in our current system. According to the World Resources Institute, over 100 billion tons of resources flow every year and 60% end up as waste or greenhouse emissions. Similarly, we waste approximately a third of all food produced. The circular economy offers a system where waste and pollution are reduced through product design. Importantly, 80% of environmental impacts are determined during the design stage. With a change in mindset, waste becomes a design flaw instead of being an inherent byproduct of everyday consumption.^[17]

The overexploitation of natural resources required to achieve economic growth and development has negatively impacted the environment and adversely affected their availability and cost. So, it is easy to see why the idea of a circular economy, which offers new ways to create a more sustainable economic growth model, is taking hold across the globe.^[18]

Watch the “Creating a Circular Economy for Fashion”, YouTube video below to learn about the innovations in the fashion industry that may just help save our world.^[19] Transcript for “Creating a Circular Economy for Fashion” Video [PDF–New Tab]. Closed captioning is available on YouTube.

References

(Note: This list of sources used is NOT in APA citation style instead the auto-footnote and media citation features of Pressbooks were utilized to cite references throughout the chapter and generate a list at the end of the chapter.)