Corporate Innovation & Entrepreneurship

What is the Relationship Between Sustainability, Innovation & Entrepreneurship?

Innovation and entrepreneurship ensure sustainability is integral to systems and practices for creating new products, processes, business models, and enterprises.

Shane and Venkataraman define sustainable entrepreneurship as "the achievement of sustainable development by discovering, evaluating, and exploiting opportunities to create value that generates economic prosperity, social cohesion, and environmental protection."

Sustainable entrepreneurship generally falls into two broad categories: social and environmental. Social entrepreneurship aims to address societal challenges by creating positive, lasting impacts on communities and individuals. Environmental entrepreneurship, on the other hand, focuses on developing innovations that benefit the environment—such as restoring ecosystems, protecting species, or mitigating ecological damage.

Importantly, these two categories are not mutually exclusive. Social and environmental issues are often deeply interconnected, and many sustainable ventures aim to address both simultaneously.

How Innovation & Entrepreneurship Powers Sustainability

Sustainability, and the wide range of issues it encompasses such as inequality, climate change, and food insecurity, is a clarion call to reimagine nearly every product, process, and business model. In other words, it is a challenge tailor-made for entrepreneurs and innovators.

In fact, sustainability represents the defining innovation challenge and opportunity of the 21st century, and likely of the centuries to come. Sooner or later, every industry and sector will be disrupted by social and environmental pressures, as well as by the entrepreneurs who bring forward profitable, transformative solutions. This idea has been widely discussed in the sustainability and innovation literature, including an analysis by Nidumolu, Prahalad, and Rangaswami that argues sustainability is no longer a constraint on business, but a powerful catalyst for innovation, growth, and competitive advantage.

Finally, sustainable innovation and entrepreneurship are critically important because social and environmental impact must be core considerations for every entrepreneur, venture fund, and angel investor. We must ensure that new products, services, and ventures do not replicate or worsen the unintended health, ecological, and inequality problems that past innovations have too often left in their wake.

Skoll Social Innovation Awardees