Building a taxonomy of eco-innovation types in firms: A quantitative perspective

Abstract

Eco-innovations, or innovations that reduce the environmental impacts of production and consumption activities, are considered crucial for sustainability transitions and a key element of a Circular Economy. Although previous contributions have acknowledged the existence of different types of eco-innovations (e.g., product vs. service or incremental vs. radical), a precise conceptualization of eco-innovation types, which takes into account its multifaceted character, is missing. Yet such a conceptualization is crucial in order to understand how eco-innovations contribute to a sustainable transition, how policy makers can promote different eco-innovation types, and how business practitioners can develop eco-innovations. This article covers this gap in the literature. Its aim is twofold: 1) to develop a quantitative method to categorise different eco-innovation types in a particular setting, taking into account their distinct features and dimensions; 2) to apply this method in a given sector and country, building a taxonomy of eco-innovation types. It draws on a survey of 197 Spanish industrial small and medium size enterprises (SMEs) which developed or adopted an eco-innovation between 2012 and 2013. The statistical analyses reveal the existence of a taxonomy of five eco-innovation types: systemic, externally driven, continuous improvement, radical (technology-push initiated) and eco-efficient. They differ in their techno-economic configurations, contribution to environmental sustainability and corporate goals and required changes in the firms. Specific policy and managerial implications are deducted.