How Organizations Evaluate Eco‐Innovation Investability: A Managerial Cognition Perspective

ABSTRACT Eco‐innovation is widely recognized as a key mechanism through which firms pursue sustainability objectives. However, little is known about the microfoundations through which specific eco‐innovation initiatives secure internal investment support within organizations. Drawing on managerial cognition theory, this study examines how organizations evaluate the investability of eco‐innovation initiatives. Based on 20 semi‐structured interviews conducted within a large multinational energy company and analyzed using the Gioia methodology, the study identifies three complementary managerial cognitive maps that inform organizational evaluations of eco‐innovation initiatives: a strategic inevitability map, which frames sustainability as a strategic priority; a dual‐value causal map, which links environmental and economic value; and a feasibility map, which assesses technological maturity, scalability, and implementation risk. We further identify governance mechanisms, including innovation committees and stage‐gate systems, as organizational arenas where these complementary managerial perspectives are articulated and considered during investment deliberations. Findings show that organizational investment decisions draw upon complementary managerial perspectives concerning strategic legitimacy, value creation, and implementation feasibility. By conceptualizing eco‐innovation investability as the organizational evaluation through which eco‐innovation initiatives become eligible for organizational resource commitment, this study develops a microfoundational explanation of eco‐innovation investment decisions and extends both eco‐innovation research and managerial cognition theory.