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The IUP Journal of Knowledge Management :
Eco-Innovation, Knowledge Capital and the Evolution of the Firm
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The purpose of this paper is to study the place of eco-innovation in industrial firms’ current strategy and to understand how they achieve this change in their technological trajectory. This is mainly based on the interviews conducted between 2009 and 2011 within eight corporations settled in France. The study revelaed that in a context of crisis, firms consider eco-innovation as a new path which generates growth in future. To refocus their strategy, ‘knowledge capital’, a concept which is considered as a tool to study the dynamic capabilities needed to achieve a change, was reorganized. The capability to develop collaborative research appears central to develop eco-innovation for two reasons: the necessity to share the costs and the risks of development; and the necessity to comply with the various aims and objectives of the stakeholders involved in this type of innovation oriented towards sustainability. Even if the importance of collaboration to develop eco-innovation is confirmed in the literature on eco-innovation, the study is based on eight cases, and is aimed at extending to develop the understanding of eco-innovation development at the firm level. This will also be done notably by including small firms in the population in order to understand the role of size in the development of capabilities needed for scientific and technological networks management. This paper contributes to the literature on the capabilities needed to achieve change; improves the analysis of the roles of collaboration in the case of eco-innovation; and illustrates these ideas with original cases.

 
 
 

The implementation of a sustainable mode of development has become the major aim of public policies in industrial countries and the evolution of economic agents’ behavior (producers and consumers) is considered as the engine of this ‘new economy’. Enterprises are thus induced to develop socially responsible behavior, that is to say, to “integrate social and environmental concerns in their business operations and in their interactions with their stakeholders on a voluntary basis” (European Commission, 2001, p. 1). For firms, the development of green innovations stresses the necessity to develop responsible behavior. ‘Green innovations’, ‘eco-technologies’ or ‘eco-innovations’ have been so far mainly defined by policy agendas and are still missing an economic definition that could be shared by scholars (Andersen, 2010; and Carrillo et al., 2010). In this paper, we retain the definition of eco-innovation proposed by the OECD (2009a), which adds two characteristics to the definition of innovation proposed by the Oslo Manual: its explicit emphasis on the reduction in the environmental impact, the fact that eco-innovation is not only limited to products, processes, marketing methods and organization methods, but also includes innovation in the social and institutional aspects. If ethics was the first reason invoked by the tenants of a social responsibility of enterprises (Bowen, 1953), the literature on corporate social responsibility and objectives of the firm puts forward two main reasons for developing responsible behavior (see notably Laperche and Uzunidis, 2011; and Laperche and Levratto, 2012)—the constraints that the external pressure from stakeholders namely, employees, shareholders, customers, suppliers, the State and the civil society put on the firm (Freeman, 1984; Caroll, 1989; and Donaldson and Preston, 1995) and the opportunity for the responsible firm to improve its economic results (Porter, 1991; Porter and Van der Linde, 1995; and Porter and Kramer, 2006).

In any case, the question for many firms—as well as for institutions and scholars—is the following: How can we change the firm’s trajectory and thus, how can we develop an eco-innovation strategy? This is the question that we explore in this paper. It builds upon a recent survey conducted in eight corporations settled in France (Laperche et al., 2011). This survey deals with the impact of the current economic crisis—which triggered off in 2007 in the US and then expanded throughout the world—on their innovation strategy. The first results show that firms took the opportunity of the crisis to develop new innovation paths. Among these, the environmental strategy appears to be central. In this paper, we build upon these first results and focus on the strategies adopted by firms to change their innovation trajectory towards innovation. To study the trajectory change, we base ourselves on the evolutionary theories of the firm as well as the broader resource-based theories that give us the tools and concepts necessary to build our vision of the role of knowledge capital (and the methods of its constitution) in the firm’s evolution (Laperche, 2007).

The first part of the paper explains the methodology of the study and the way we decided to go further into our analysis (analysis of eco-innovation, theoretical analysis of the firm’s evolution). Then it focuses on the results of our study and puts forward the role played by the collaborative constitution of ‘knowledge capital’ in the trajectory change. It also explains how public policies may contribute to overcome the limits imposed by the costs of change.

 
 
 

Knowledge Management Journal, Eco-innovation, Evolution, Firm, Capabilities, Knowledge capital, Collaboration.