Innovations for decarbonization under weak regulatory constraints

Innovations for decarbonization are crucial for our world's sustainable future. This article explores the impact of weak regulatory frameworks on sustainability-oriented innovation strategies for decarbonization in the industrial electronics sector. The research aims to understand how companies adapt their innovation strategies to voluntary decarbonization targets and how the perceived regulatory context affects incentives for eco-innovation. The study employs a multiple case study approach, collecting primary data through interviews and secondary data from public sources. The results reveal the challenges companies face in implementing effective innovation strategies due to unpredictable and non-rigorous carbon policies. In the absence of strong regulations and transparent criteria, firms are less incentivized to invest in innovative solutions for carbon emissions reduction. We found evidence that in most cases, absent any regulatory pressure or mandatory mechanism for transparent and homogeneous information disclosure, companies prefer strategically to limit ecoinnovation. Moreover, this context of uncertainty seems to favour opportunistic behaviour.