Current empirical data supports the significance of combining sustainability standards with well-established innovation theories. The resource-based view provides the basis for understanding how businesses create competitive advantage through distinctive environmental capabilities (Barney, 1991). According to recent research, eco-innovation performance varies greatly depending on the size of the company; smaller businesses gain from improved operational efficiency and market positioning, while larger businesses show stronger financial performance outcomes from eco-innovation investments (Mansour et al., 2024). The resource-based perspective is supported by this size-based variation, which illustrates how various resource endowments affect the results of eco-innovation.

Institutional theory explains how regulatory, normative, and cultural factors shape eco-innovation behavior. Governance mechanisms, particularly board independence and expertise, significantly drive eco-innovation adoption (Mansour et al., 2025a, 2025b). Recent studies on board effectiveness show that governance procedures have a major impact on innovation and environmental disclosure practices, and that board independence and expertise are important institutional variables that promote the adoption of eco-innovation (Mansour et al., 2025a, 2025b). Gender diversity improves eco-innovation through better decision-making processes and stakeholder engagement, according to empirical data from the global energy sector, which highlights the significance of female leadership and gender-diverse boards (Mansour et al., 2025a, 2025b). Dynamic capabilities theory describes how organizations develop abilities to identify environmental opportunities, pursue innovation possibilities, and transform their resources over time (Teece, 2007). Understanding how eco-oriented capabilities develop within businesses and how leadership diversity supports dynamic sensing and seizing processes are two areas in which this theoretical approach is especially pertinent.

The integration of these three theoretical perspectives provides a comprehensive understanding of eco-innovation as both a capability-building process and an institutional response to sustainability demands, with company size, governance structures, and leadership diversity serving as key factors influencing outcomes.

There have been four main eras in the conceptual evolution of eco-innovation, each with its own theoretical orientations and definitional emphases that reflect broader changes in sustainability policy, environmental science, and innovation theory.

Existing definitions of eco-innovation have three serious challenges that hinder further research and real-world application. First, despite their significant differences, similar terms like green innovation, environmental innovation, and sustainable innovation are frequently employed interchangeably, leading to terminological confusion (Schiederig and Tietze, 2012; Chen et al., 2006). Second, rather than fostering a unified understanding, theoretical dispersion across disciplines—from environmental economics to innovation studies—has resulted in variable definitions that reflect disparate disciplinary goals (Hart, 1995; Geels, 2005). Third, the current definitions lack operational clarity, with ambiguous words such as “significantly improved” providing little advice for organizational implementation (OECD, 2008). In this quickly evolving subject, there is an urgent need for conceptual clarity, as these definitional issues have cascade repercussions that include challenges with research validity, limitations on theoretical advancement, and implementation obstacles (Zheng and Iatridis, 2022).

To maintain openness and rigor, this work complies with PRISMA (Preferred Reporting Items for Systematic Reviews and Meta-Analyses) requirements (Page et al., 2021). To find, examine, and compile definitions of eco-innovation from scholarly works, we carried out an extensive systematic review by using a concise research string (Table 1).

The comprehensive screening methodology spanning 1996–2025 identified relevant eco-innovation definitions from academic literature, resulting in 85 studies meeting all inclusion criteria for theoretical and definitional analysis (Figure 1).

Thematic analysis of definitions: to find recurrent themes, patterns, and conceptual elements in eco-innovation definitions, a structured content analysis methodology was used. The process comprised the following steps: (1) initial inductive coding of definitional components; (2) iterative comparison of definitions to identify recurrent themes; (3) creation of thematic categories based on frequency and conceptual significance; and (4) synthesis of themes into cohesive definitional dimensions. Two researchers independently coded a 20% subsample to guarantee inter-coder reliability, resulting in a Cohen’s kappa of 0.82.

Temporal analysis of definitional evolution: the conceptual evolution from 1996 to 2025 has been tracked using a chronological mapping of definitional changes. In this analysis, definitions were arranged chronologically by year of publication, paradigmatic shifts and transitional periods were identified, definitional complexity changes over time were analyzed, and definitional evolution was correlated with broader theoretical and policy developments. Time-series analysis techniques were applied to identify significant trend breaks and evolutionary phases (Table 2).

Theoretical framework mapping: to understand the disciplinary foundations of various definitions, a comprehensive classification of underlying theoretical viewpoints was carried out. This process involved mapping theoretical combinations and integrations, identifying explicit theoretical references within each study, classifying implicit theoretical orientations according to conceptual emphasis, and evaluating theoretical diversity and convergence patterns. Theoretical frameworks were coded according to established innovation and sustainability theory taxonomies (Table 2).

Gap analysis and synthesis: the following methods were used to conduct a thorough assessment of definitional limitations and integration opportunities: (1) a systematic comparison of definitional scope and emphasis across studies; (2) the identification of conceptual gaps and inconsistencies; (3) an analysis of the practical implementation guidance provided by various definitions; and (4) the synthesis of insights to inform theoretical integration requirements. Constant comparative methods were used in this investigation to find convergence and divergence tendencies among definitional approaches.

Therefore, by (1) systematically comparing the definitional scope and emphasis across studies, (2) identifying conceptual gaps and inconsistencies, (3) analyzing the practical implementation guidance provided by various definitions, and (4) synthesizing insights to inform theoretical integration requirements, a thorough evaluation of definitional limitations and integration opportunities was carried out. To find trends of convergence and divergence among definitional approaches, this investigation used constant comparative methodologies (Table 3).

Our analysis reveals three distinct periods in eco-innovation definitional development:

Temporal evolution of definitions.

The three developmental phases (1996–2025) highlight the temporal growth of eco-innovation definitions, moving from a restricted technological focus to approaches that encompass systems transformation. The analysis shows that conceptual sophistication and scope expansion are growing over time, with Period 1 focusing on technological solutions within environmental protection frameworks (Arundel and Kemp, 2009), Period 2 incorporating stakeholder considerations and business value creation, and Period 3 adopting systemic perspectives that include sustainability transitions and social dimensions. Each period reflects distinct theoretical orientations and practical emphases, demonstrating the field’s development from linear innovation models to complex systems approaches that tackle interrelated environmental, economic, and social challenges.

Four prevailing approaches are identified through the analysis of the theoretical foundations of the reviewed literature. The most common theoretical framework, according to 32% of studies, is the resource-based view, which emphasizes organizational capabilities and the development of competitive advantage through environmental improvements. Institutional theory coms in second (28% of studies) with a focus on the normative and regulatory forced that propel the adoption of eco-innovation. Stakeholder theory, which emphasizes multi-actor collaboration and value creation processes in eco-innovation development, makes up 24% of studies. Taking a systemic approach to innovation processes within larger institutional and network contexts, innovation systems perspectives make up 16% of studies.

Despite this theoretical diversity, the literature still has notable integration gaps. Instead of integrating several frameworks, the majority of studies only use one theoretical perspective, which restricts the ability to fully comprehend eco-innovation processes. Organizations’ development and evolution of eco-innovation capabilities throughout time may be explained by dynamic capabilities theory, which is not given enough attention. Sustainability transition theories are still not well integrated, even though they are important for comprehending systemic change processes. Furthermore, current theoretical frameworks do not adequately account for implementation mechanisms, focusing primarily on adoption drivers rather than execution processes.

Our analysis highlights three primary categories of eco-innovation definitions:

The analysis identifies three unique definitional categories, each with varying theoretical focuses and practical consequences (Table 4). Definitions that are output-focused (42%) predominant in the literature but have a narrow scope, whereas definitions that are system-focused (27%) provide thorough perspectives but are unclear in their implementation. Definitions that are process-focused (31%) have a moderate scope and a stronger focus on implementation. The overall definitional fragmentation in the field is a result of the various disciplinary origins and theoretical underpinnings reflected in each category.

Action verb categories by implementation clarity:

Action verb usage in eco-innovation definitions from 85 studies employing typical definitions from the literature was analyzed for frequency. The word “develop” (67%) dominates the literature with extremely high implementation clarity for the creation of original invention (Baroulaki and Veshangh, 2007), whereas “improve” (54%) provides strong practical direction through quantifiable performance targets. There is a distinct hierarchy in eco-innovation implementation approaches, with creation-oriented verbs offering the most implementation clarity for innovation activities and adoption-oriented verbs concentrating on the deployment of pre-existing solutions with lesser innovation intensity (Table 5).

According to the outcome investigation, eco-innovation stands out from other forms of innovation because it has a clear focus on fusing economic and ecological advantages (INNOVA, EUROPA, 2006). Eco-innovation definitions consistently incorporate both environmental (89%) and business (67%) outcomes as core objectives, in contrast to green innovation, which focuses primarily on environmental outcomes (Andersen, 2008; Chen et al., 2017; Kanerva et al., 2009; Driessen and Hillebrand, 2002; Chen et al., 2006), or environmental innovation, which emphasizes technical pollution reduction (Rennings, 2000). This dual emphasis sets eco-innovation apart from the more comprehensive triple bottom line strategy of sustainable innovation, which incorporates social aspects (Zubeltzu-Jaka et al., 2018; Adams et al., 2016). This unique dual value proposition is illustrated in the literature by researchers such as Fussler and James (1996), who stress the simultaneous supply of environmental and consumer value, and the OECD (2008) definition, which calls for both economic competitiveness and environmental improvement (Table 6).

Five key limitations are identified by our methodical investigation as restricting the theoretical development and practical application of eco-innovation. The field’s fragmented evolution is the cause of these gaps, which emphasize the urgent need for conceptual integration.

Based on our systemic analysis and theoretical integration, we propose the following definition:

Each aspect of our suggested definition fills in the gaps observed in present approaches in a particular theoretical and practical manner. In order to emphasize that eco-innovation is an organizational ability to generate and manage innovations rather than just results or activities, the term “organizational capability” grounds the definition in resource-based view and dynamic capabilities theory. In order to address the implementation ambiguity, present in current definitions, the four action verbs “adopt, integrate, improve, and develop” provide precise action orientations that offer helpful advice while acknowledging varying degrees of organizational capacity and innovation intensity. By defining particular areas where eco-innovation might take place, the three innovation types- “eco-innovative management systems, eco-outputs, eco-markets”- allow businesses to pursue strategic emphasis and implementation planning. The focus on “eco-oriented culture and capabilities” highlights important organizational prerequisites for effective eco-innovation, formally acknowledging both cultural and capability aspects that are frequently missed by current definitions. The expression “value for environmental sustainability and business performance” avoids making assumptions about trade-offs between environmental and economic goals while clearly recognizing eco-innovation’s unique dual value creation requirement. Last but not least, the link to “sustainability transitions” ties eco-innovation to more general systemic change goals, addressing the systems-level perspective that has surfaced in recent eco-innovation research and recognizing the transformative potential of innovation activities beyond individual organizational benefits (Figure 2).

Our methodical investigation identifies patterns that both support and go beyond current empirical findings in eco-innovation studies. Recent meta-analyses demonstrating the popularity of these theoretical frameworks in empirical research are consistent with the dominance of resource-based view (32% of studies) and institutional theory (28% of studies) in definitional approaches (Zheng and Iatridis, 2022). Nevertheless, our research reveals a crucial gap: current definitions do not sufficiently take into account these organizational factors, despite recent empirical studies showing the significance of leadership diversity and governance procedures for eco-innovation success (Mansour et al., 2025a, 2025b).

Current empirical evidence on the impact of firm size on eco-innovation performance (Mansour et al., 2024) confirms our conclusion that definitional approaches need to take into account various organizational contexts and capabilities. According to our analysis, large organizations’ inclinations toward radical innovation are reflected in creation-oriented verbs (67% frequency for “develop”), but smaller firms’ emphasis on operational improvements is better reflected in enhancement-oriented approaches. This conceptual-empirical connection supports the need for adaptable definitional frameworks that take into account various contexts in which eco-innovation is implemented.

Our theoretical framework fills in the gaps identified in the current literature by establishing a link between institutional governance mechanisms and resource-based capabilities. The focus on eco-oriented capabilities that include both technical capabilities and governance structures is supported by recent empirical studies showing that board effectiveness significantly influences environmental disclosure and innovation success (Mansour et al., 2025a, 2025b). The integration of dynamic capabilities theory with contemporary leadership research (Mansour et al., 2025a, 2025b) provides theoretical grounding for understanding how gender-diverse leadership enhances environmental innovation through improved sensing and seizing processes.

Making a clear distinction between eco-innovation and similar concepts is essential for both academic development and practical implementation.

Eco-innovation vs. green innovation: findings clarify that eco-innovation specifically combines environmental goals with economic viability concerns, while green innovation focuses largely on environmental benefits without necessarily guaranteeing company sustainability (Chen et al., 2006; Schiederig and Tietze, 2012). This distinction is supported by recent empirical evidence demonstrating that effective eco-innovations necessitate market development capabilities and business model innovation beyond technical environmental solutions (Mansour et al., 2025a, 2025b).

Eco-innovation vs. environmental innovation: environmental innovation focuses on technical solutions for particular environmental issues, frequently within the parameters of regulatory compliance. Beyond a technological focus, eco-innovation includes system-, market-, and organizational-level improvements that benefit a variety of stakeholders. This distinction is demonstrated by recent studies on environmental disclosure and governance mechanisms, which show that eco-innovation necessitates organizational capabilities that incorporate environmental considerations into business operations rather than treating them as distinct technical challenges (Mansour et al., 2025a, 2025b).

Eco-innovation vs. sustainable innovation: sustainable innovation embraces triple bottom line strategies that specifically incorporate economic, social, and environmental factors. Findings highlight that eco-innovation recognizes but does not always incorporate social goals while maintaining a dual focus on economic and environmental results.

This research highlights a number of implementation issues that companies encounter when putting eco-innovation definitions into practice, especially when it comes to creating eco-friendly organizational culture.

Barriers to cultural transformation are arguably the biggest implementation issue. Fundamental changes in attitudes, beliefs, and behavioral norms are necessary to create an eco-friendly corporate culture, and these changes frequently run counter to established organizational procedures and performance indicators. Resistance to change can be a problem for organizations, especially if environmental initiatives are thought to limit operational profitability or efficiency. Strong leadership commitment and governance support are crucial for effective cultural transformation, according to recent empirical research (Mansour et al., 2025a, 2025b). However, many organizations lack the governance capabilities required for long-lasting cultural change.

Capability development challenges arise from eco-oriented capabilities’ intricate, multidisciplinary nature. Stakeholder cooperation capabilities, innovation management systems, technical environmental knowledge, and change management capabilities need all to be developed concurrently by organizations. This capability portfolio necessitates a large investment in organizational learning systems, training initiatives, and human capital development. It is important for definitional frameworks to recognize that implementation barriers may arise due to the lack of resources required for complete capability development, particularly in smaller businesses.

Measurement and evaluation difficulties emerge from the multifaceted character of eco-innovation outputs and the temporal discrepancy between performance outcomes and environmental investments. Companies find it difficult to create suitable measures for evaluating the effectiveness of eco-innovation, especially when definitions place an emphasis on abstract concepts like “environmental improvements” or “sustainability transitions” without providing precise measuring standards.