| Greening Goliaths versus Emerging Davids (2009) | |||||||||||||
Abstract | |||||||||||||
| This paper proposes a model of how incumbents and new entrants engage differently into sustainable entrepreneurship. Today many industries are attacked for degrading the ecosystem and not living up to their responsibility towards society in terms of protecting the legitimate interests of their stakeholders. These pressures have triggered a transformation of the market and non-market environments, leading to business risks as well as opportunities. Firms have two distinct possibilities to react to the challenge of improving their environmental and social performance: sustainability bureaucracy (i.e. the optimization of existing business models through the use of sustainability anagement systems) and sustainability entrepreneurship (i.e. the creation of new business models through the identification and exploitation of opportunities to improve social and environmental conditions). We suggest that in the early stages of an industry’s sustainability transformation new entrants are more likely than incumbents to engage in radical new business models since they are unencumbered by the incumbents’ fear of cannibalizing the market share of their prior products. As a result many industry incumbents have seen themselves assailed by a plethora of sustainability-oriented start-ups (‘Emerging Davids’) aiming at transforming the markets they enter. In reaction to this competition incumbents increasingly engage in corporate sustainable entrepreneurship activities of their own. While these ‘Greening Goliaths’ are often less strict in their environmental improvements they may nonetheless have a broader reach due to their established large market shares. This paper analyses the interplay between the ‘Greening Goliaths’ and ‘Emerging Davids’ and shows how it is their compounded impact that promotes the sustainable transformation of industries. | |||||||||||||
Publication details | |||||||||||||
| |||||||||||||