Coupling Responsible Innovation and Sustainable Business Model Innovation to Address Grand Challenges

Abstract

ABSTRACT Academic Abstract Innovations designed to address grand challenges within the social innovation sector can have unintended consequences, particularly where organizations pursue triple‐bottom‐line objectives under resource constraints. Yet research on coupling responsible innovation (RI) and sustainable business model innovation (SBMI) largely frames this as aspirational rather than theoretical, leaving it conceptually underdeveloped and empirically underexplored. Accordingly, this study asks: How can organizations operating within institutionally weak environments embed RI to make their SBMI processes more responsible? Utilizing a 10‐year longitudinal study of a social enterprise delivering off‐grid solar in Africa, we identify three SBMI cycles and develop a process framework for RI‐SBMI coupling. We outline four RI‐shaped organizational capacities that support business model evolution as a dynamic, principle‐driven process in which RI functions as a sensitizing framework rather than a fixed ethical template. We further demonstrate that paradox management, through the mechanisms of experimentation, relinquishing control, and value prioritization, is central to responsible SBMI. We also show that RI principles are not applied equally; instead, their importance changes depending on organizational capacity and the part of the business model. Finally, by grounding these dynamics in an institutionally weak context, the study advances theory on responsible business model evolution. Practitioner Abstract Low‐income households in resource‐constrained settings characterized by rural poverty, limited infrastructure, and constrained market access are some of the most vulnerable to the impacts of grand challenges. Therefore, to avoid unintentional reinforcement of structural inequalities, it is essential to conduct regular, inclusive consultation with stakeholders. Ideally, this is undertaken during SBM development but can and should be applied to existing SBMs. Within institutionally weak contexts, systematically identifying and assessing opportunities, both internal and external to the organization, and innovating to accommodate them can improve geographic reach and market competitiveness. When working with environmentally friendly technologies and practices, a critical, reflexive review should be continuously undertaken, ideally incorporating in‐house expertise and neutral, external input (e.g., from research organizations). The creation of greater social and environmental values will require a willingness to sacrifice some economic value capture. Therefore, coupling the principles between RI and SBMI can help achieve this while maintaining economic viability. For profit‐making companies, inclusive stakeholder engagement may enhance organizational legitimacy and build a low‐income customer base, while systematic identification of opportunities supports competitiveness and innovation. Coupling RI and SBMI helps balance social, environmental, and economic objectives, potentially improving credibility.

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