Sustainable Business Models: A Review

Abstract

During the past two decades of the e-commerce growth the concept of business model has become increasingly popular. More recently, the research on this realm has grown rapidly with a diverse research activity covering a wide range of application areas. Considering the sustainable development goals the innovative business models have brought competitive advantage to improve the sustainability performance of organizations. The concept of sustainable business model describes the rationale of how an organization creates, delivers, and captures value, in economic, social, cultural or other contexts in a sustainable way. The process of sustainable business model construction forms an innovative part of business strategy. Different industries and businesses have utilized sustainable business models concept to satisfy their economic, environmental and social goals simultaneously. However, the success, popularity, and the progress of sustainable business models in different application domains are not clear. To explore this issue, this research provides a comprehensive review on sustainable business models literature in various application areas. Notable sustainable business models are identified and further classified in fifteen unique categories, and in every category the progress (either failure or success) has been reviewed and the research gaps are discussed. Taxonomy of the applications includes, innovation, management and marketing, entrepreneurship, energy, fashion, healthcare, agri-food, supply chain management, circular economy, developing countries, engineering, construction and real estate, mobility and transportation, and hospitality. The key contribution of this study is to provide an insight about the state of the art of sustainable business models in various application areas and the future research directions. This paper concludes that popularity and the success rate of sustainable business models in all application domains have been increased along with increasing use of advanced ICT technologies.

Classification of Sustainable Business Models: A literature review and a map of their impact on the Sustainable Development Goals

“…The private and government sectors have experienced internal organizational challenges attempting to fulfill the SDGs' targets. The overall market competition has also been affected to the extent that traditional Business models (BM) are no longer profitable [13]. Firms are encouraged to develop a Sustainable BM (SBM) to meet sustainability goals [14,15].…”

“…The Agenda identifies seventeen SDGs that convey the challenges of society and the planet. The SDGs proposed can only be met with a combined effort from the main actors, companies and society [13]. In this regard, the business sector has a key role in changing its production patterns towards more sustainable ones and at the same time incentivise the customer to prefer sustainable consumption paradigms.…”