Inter-Firm Differences in the Sustainability Business Model: A Study on Select Firms from Agri-Food and IT Companies

Abstract

When enterprises compete using business models that differ from one another, the outcomes are difficult to predict. One business model may appear superior to others when analyzed in isolation but create less value than the others when interactions are considered. Or rivals may end up becoming partners in value creation. Appraising models in a stand-alone fashion leads to faulty assessments of their strengths and weaknesses and bad decision making. This is a big reason why so many new business models fail. The study identified five important component — economic, social, environmental, holistic and business/commercial characteristics to analyze the Sustainability Business Model (SBM) of the select companies. The first three characteristics, namely, economic, social and environmental are common to most of the SBM developed and they are also a part of sustainability reporting developed by Global Reporting Initiative (GRI), a leading organization in the sustainability field which promotes the use of sustainability reporting as a way for organizations to become more sustainable and contribute to sustainable development. The fourth characteristic, holistic, is added by Stubbs and Cocklin (the modified version of Stubbs and Cocklin SBM model is analyzed in the present research). The fifth characteristic, business/commercial characteristic is added as the study aimed at analyzing the relationship between commercial and sustainability characteristics of the select firms. The paper discusses whether there is a correlation between the various sustainability characteristics. It focuses on inter-firm differences in sustainability components of the business model of the select companies. It also deliberates whether there is a correlation between the various sustainability characteristics and how inter-firm differences affect the sustainability of the select companies identified in this study.