Sustainable innovation strategies and firm performance: evidence from the Italian food industry

Purpose This study analyzes the sustainability and innovation decisions of 150 Italian food companies selected from a monitored sample of 444 firms across diverse sectors and sizes. Design/methodology/approach The research employed a survey of 150 respondent firms. Analyses were conducted using both standard linear regression (with and without industry fixed effects) and instrumental variable (IV) regression (also with and without industry fixed effects). Findings This study shows that firms that formalize their sustainability strategies and actively communicate their efforts externally achieve superior growth. Top performers not only embrace sustainability, but also pioneer radical innovations in production processes, accelerating their transition to more resilient, sustainable business models. Research limitations/implications The results of this study may have been influenced by the specific characteristics of the sector analyzed, where there is considerable pressure to transform the production system. This pressure is likely to contribute to the relatively high level of proactivity observed among firms with respect to sustainable innovation. Practical implications The importance of formalizing sustainability strategies and the impact of radical process innovations suggest that these developments may have significant implications for firms' business models. Originality/value Our study is original because we have analyzed a very large number of firms of the Italian food industry, not only, but the study examines how sustainability strategies are defined, how they are communicated externally, and what organizational changes they induce, particularly in production processes. Our analysis also includes sustainability practices related to supplier relationships, particularly the selection of suppliers based on their sustainability credentials.