A compelling research study conducted by faculty at Indian Institute of Management Lucknow has unveiled the critical role that the personal values of startup founders play in fostering businesses that balance profitability with environmental and social responsibility. This study highlights how entrepreneurs driven by sustainability navigate the complexities of aligning economic objectives with broader societal and environmental goals, even under the pressure to prioritise profit alone.
The study, published in the prestigious Journal of Cleaner Production, is co-authored by Prof. Krishna Chandra Balodi, Strategic Management, IIM Lucknow, and his research scholar, Mr. Ravi Roshan.
The research emphasises how sustainability-oriented values in founders drive Sustainable Business Model Innovation (SBMI). For example, founders of sustainable startups frequently engage with partners who may initially lack a sustainability focus, inspiring them to adopt greener practices. This ripple effect fosters a larger ecosystem of sustainable businesses, redefining success to include positive contributions to environmental and social well-being alongside profitability.
Speaking about the research, Prof. Krishna Chandra Balodi, Strategic Management, IIM Lucknow, stated, "Our research illustrates the transformative influence of founders’ sustainability values on business models that address pressing global challenges. These entrepreneurs redefine success by integrating their principles into their ventures, striking a balance between profit and meaningful environmental and social impact."
The research centers on "Suscom," a startup renowned for its sustainable practices. By delving deeply into Suscom’s operations, the study revealed that the founders’ values permeate every facet of the business—from product innovation to strategic partnerships. These values are rooted in a blend of influences, such as family upbringing, sustainability-focused education, and early career experiences with non-profits advocating for environmental and social causes.
The research also brings attention to the unique challenges faced by sustainable startups, such as:
Recruiting employees with a sustainability mindset: Building a workforce aligned with the company’s goals.
Eco-friendly sourcing: Procuring sustainable raw materials.
Green logistics: Finding partners who offer environmentally friendly logistics solutions.
Despite these hurdles, the study highlights that founders committed to sustainability can overcome these barriers through:
Collaborative partnerships: Working with like-minded stakeholders.
Innovative strategies: Developing creative, low-tech production methods that minimise energy consumption and environmental impact.
One of the standout findings is Suscom’s use of traditional and indigenous techniques to reduce energy consumption. These methods not only align with global decarbonisation efforts but also present an eco-friendly alternative to high-energy industrial processes.
As businesses worldwide face mounting pressure to address sustainability and climate change, this research underscores the significance of value-driven leadership. It serves as a beacon for entrepreneurs to adopt sustainable practices that not only ensure financial viability but also contribute meaningfully to societal and environmental progress.
By offering valuable insights into how personal values can catalyse sustainable innovation, the study reinforces the need for business leaders to think beyond profits and prioritise long-term, equitable growth.