In an era marked by climate change, social unrest, and global disruption, innovation can no longer be quantified by a firm’s quarterly returns alone. Business leaders and policymakers face a growing imperative to align innovation strategies and policies with broader values, namely health, equity, sustainability, and long-term societal well-being.
A new study from Olivier Toubia, Columbia Business School’s Glaubinger Professor of Business along with Professors Darren Dahl of the University of British Columbia; Charles Noble of the University of Tennessee; and Martin Schreier of Vienna University of Economics and Business, introduces a framework to help leaders do just that. Rather than proposing a one-size-fits-all solution, their paper outlines what they call Better World (BW) Innovation: a rethinking of how innovation is designed, implemented, and measured in the modern economy.
Their work is a call to action for firms that want to remain relevant and resilient in a world where financial performance increasingly hinges on a company’s ability to create social and environmental value.
How the Research Was Done
The researchers, Toubia, Darren Dahl (University of British Columbia), Charles Noble (University of Tennessee), and Martin Schreier (WU Vienna), set out to build a forward-looking framework that could help leaders navigate today’s rapidly evolving innovation landscape. Their approach is rooted in practical business challenges—how to build innovation systems that balance profitability with broader societal responsibility.
For example, fast fashion and single-use plastics are consumer-driven innovations that may maximize short-term gains but create long-term harm. Similarly, electric vehicles are a case where innovation requires ecosystem-level infrastructure and collaboration to succeed. In other cases, such as the push to reduce tobacco consumption or transition away from gas-powered cars, the researchers suggest that innovation may involve “de-adoption,” or deliberately moving consumers away from certain products.
Drawing from decades of scholarship in marketing, organizational behavior, and innovation strategy, the team synthesized a wide array of insights into a single, coherent framework. Together, the researchers offer a structured way of thinking to guide future research and practice.
What the Researchers Found
The researchers’ central argument is that the dominant innovation model, focused on consumer demand, competitive advantage, and short-term financial returns, is poorly suited to the scale and complexity of today’s global challenges. In response, they outline a vision for “Better World” (BW) Innovation: an approach that places sustainability, equity, health, and long-term value at the core of the innovation process.
They identify four key domains where innovation practices must evolve:
- Rethinking the Innovation Process
Traditional innovation often centers narrowly on consumer wants. The researchers argue that firms should instead design with a broader system in mind—one that accounts for environmental degradation, social inequality, and long-term well-being. In some cases, they suggest that the most responsible decision may not be to innovate.
- Redesigning Organizational Structures
Short-term performance pressures can undermine long-term innovation goals. To shift toward BW outcomes, the researchers emphasize the importance of changing incentive systems, decision-making authority, and evaluation criteria to support patient, collaborative, and inclusive innovation efforts.
- Understanding Consumer Behavior
Rather than focusing solely on encouraging product adoption, firms must also consider when to slow or steer consumption based on externalities. BW Innovation calls for a more active role in shaping consumer behavior to meet demand and foster outcomes aligned with societal and environmental health.
- Building Supportive Ecosystems
Sustained, high-impact innovation rarely happens in isolation. The researchers stress the importance of market infrastructure, such as cross-sector alliances, public-private partnerships, and forward-thinking regulation, that can help BW innovations scale and endure.
Together, these dimensions represent a departure from innovation-as-usual. The researchers aren’t advocating for abandoning business performance, however. Instead, they argue that long-term success increasingly depends on meeting rising stakeholder expectations for transparency, impact, and shared value.
Why the Research Matters
The BW Innovation framework offers challenges and opportunities for firms navigating heightened social expectations, regulatory scrutiny, and systemic risk. The researchers provide a foundation for business leaders, policymakers, and scholars who want to build innovation systems that are not just competitive but constructive.
Their message is clear: the world’s biggest challenges require new ways of thinking, building, and measuring success. BW Innovation provides a vocabulary and framework to guide that shift, while leaving room for experimentation, diversity of approaches, and future research.
“Long-term business success is increasingly tied to a firm’s ability to respond to stakeholder expectations for sustainability, transparency, and social impact,” Toubia said.
The framework is not a blueprint, however. It’s an invitation for companies to lead with purpose, for researchers to expand the field, and for markets to reward innovation that delivers more than profit.
Adapted from “Better Innovation for a Better World” by Olivier Toubia, Columbia Business School’s Glaubinger Professor of Business, Darren Dahl of the University of British Columbia, Charles Noble of the University of Tennessee, and Martin Schreier of Vienna University of Economics and Business.