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The purpose of this study was to investigate potential direct impact of environmental, social and governance factors (ESG) on organisational innovation and their role as isomorphic factors in multinational life sciences organisations.

The authors applied necessary condition analysis (NCA), using the R statistical tool to determine the direct impact of environmental (E), social (S), governance(G) and composite ESG factors on innovation, represented by research and development (R&D) expenditure across a sample of 86 multinational life sciences companies.

The study established that ESG factors have a positive impact on the innovation output of multinational firms in the life sciences industry. Further, the study also established that ESG factors act as isomorphic factors in the organisation of multinational life sciences firms in implementing sustainability practices.

This empirical research study was a novel attempt to establish a direct impact of ESG factors on innovation output of multinational life sciences firms. This was one of the first empirical studies to integrate the institutional theory with the resource-based view and thereby demonstrate that ESG factors had a significant role in contributing to institutional isomorphic behaviour, in the form of sustainable innovation as a strategy. This study established the importance of ESG factors in defining the sustainability agenda of multinational life sciences organisations. Lastly, the study elucidates the benefits of the integration of sustainability as a strategy in multinational life sciences corporations.

The purpose of this study is to identify the factors that contribute to the successful implementation and management of sustainable innovation in research-intensive sectors such as the life sciences industry.

The study was conducted through a combination of two methods. The first was qualitative interviews of 21 sustainability experts and leaders in the life sciences industry who were responsible for implementing sustainable innovation. They were selected through nonprobabilistic purposive sampling. The second method was thematic content analysis using the MAXQDA software.

The study identified that successful implementation of sustainable innovation in research-intensive firms begins with the alignment of the executive vision for sustainability with the business objectives of the research-intensive firm. Furthermore, implementation of sustainability practices is identified as a function of organizational reconfigurations that facilitate purposeful inflow and outflow of ideas and knowledge between internal firm resources and external stakeholders, anchored by the objectives of the research-intensive firm.

The study explicated factors only within life sciences industry based on qualitative interviews. The study offers scope for cross-sector quantitative evaluation.

To the best of the authors’ knowledge, this study is among the first studies to systematically delineate the underlying factors that govern successful implementation of sustainable innovation in research-intensive industries, through integration of the resource-based view and stakeholder theory and thereby provide a framework for research-intensive organizations to implement sustainable innovation practices.