Challenges in the measurement of sustainable innovations

The success or failure of any innovation mainly depends on its ability to win the support of stakeholders, especially of decision-makers and policymakers who have the power to decide on investing or subsidizing investments (Birchall et ah, 2011). Thus, the performance measurement of sustainable innovations should depend on the information needs of users. Understanding the requirements of information users is one of the primary challenges in sustainable innovation performance measurement.

Keeping information users in mind, this section discusses the specific challenges in measuring sustainable innovation performance by drawing examples from the perspective of a firm in the plantation agriculture industry (the tea industry in Sri Lanka) regarding SSTB and HFIWM methods. These challenges are discussed below:

Determination of the dimension of sustainability performance to be measured

When attempting to measure sustainable innovation performance, a fundamental yet essential issue that arises is the difficulty in determining the dimensions to be measured (Gunarathne, 2019). There are two interconnected issues here.

First, due to the interconnected nature of the sustainability performance, there is a difficulty in deciding the economic, environmental, or social dimension under which the sustainability performance should be assessed. Silvestre and Jirca (2019) consider this as a “complexity,” which is one of the fundamental characteristics of sustainable innovation. The complexity of sustainable innovation is caused by a large number of interconnected factors that impact, or are impacted by, the other factors (Bocken, Short et al., 2014; Silvestre & Jirca, 2019). For instance, when a sustainable innovation leads to an increase in the level of production or worker efficiency given that the employees’ remuneration is correlated to production, a fundamental question that arises is under which dimension, i.e., economic or social, should this increase in employee earnings be accounted for. More specifically, in the context of the tea industry, the SSTB method increases the tea crop. Since the greater part of the earnings of the estate workers depends on the quantity of the plucked tea, an increase in tea yield also leads to a rise in the earnings of the estate workers. Should this be assessed under the economic or social dimension? If the performance of sustainable innovation is assessed in totality, variations in the dimension under which the benefits are accrued do not matter. However, for someone interested in the performance of a particular dimension, this can pose a challenge.

Second, even if the first issue is to overcome or to agree upon, there is another challenge to determine the sub-dimensions under which sustainability performance is assessed. For instance, increased coverage of the tea bush canopy under the SSTB method results in larger bush frames with additional wood biomass with fixed carbon. Due to the quick re-establishment of the tea canopy, there are many other environmental benefits such as retention of groundwater storage, increase in soil moisture supply for tea crop, enhancement of the water supply in the downstream catchment areas for other agricultural crop production during dry periods, minimization of soil erosion, and control of the incidence of floods at lower elevations. From a social perspective, it improves the quality of drinking water and lengthens the duration and quantity of drinking water availability. Hence, due to the availability of multitudinous aspects to consider, the determination of the dimensions under which the sustainability performance is accrued is one of the fundamental challenges in the measurement of sustainable innovation performance.

Measurement of the sustainability performance under different dimensions

Even after deciding on the sub-dimensions for measurement of the sustainable innovation performance, the real challenge is confronted in the ensuing stage. For instance, under both SSTB and HFIWM methods, there is a difficulty in measuring the environmental impacts such as the root growth of tea bushes, nutrient use efficiency, improvements in soil conditions, the extent of carbon fixing in the tea bushes, other resource use efficiency such as sunlight and water and actual biomass production.

Establishment of accurate measurement methods which are easy to communicate

Due to the variety of benefits and sub-dimensions to consider, it will be necessary to find new measurement approaches and tools to assess the performance of sustainable innovations. However, this can easily be subject to criticism and scepticism. Since it is the innovation performance that determines the viability and acceptance of sustainable innovation, there is a challenge to win legitimacy and approval from stakeholders who are concerned about a sustainable innovation. As most of the sustainable innovations disrupt the status quo of any industry, there are always actors who resist the acceptance of sustainable innovations. Vague or novel measurement approaches that are not yet widely accepted and fine-tuned can easily be targeted by these actors who oppose the innovations. This is particularly so in industries such as plantation agriculture where there is nexus between stakeholders with varying interests (Gunarathne, 2020). Hence, there is a challenge to find measurement and evaluation tools and approaches of high precision and wide acceptance.

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