Expanding bioplastics production: sustainable business innovation in the chemical industry

The case of bioplastics illustrates how business models can link producers and customers through the development of new technologies and products. Chemical companies have assumed that reducing costs, increasing yields, and developing better feedstock supplies will guarantee the success of bioplastics in the market, yet a number of unconventional hurdles exist. Companies need to build markets for bioplastics and to assure customers that bioplastics are indeed sustainably made. We contend that companies are most able to develop business models that bring bioplastics to market effectively when they develop and mobilize their “dynamic capabilities” around sustainability. DuPont, BASF, and Braskem have identified new market opportunities for bioplastics, designed distinctive types of business models to seize these opportunities, and devised ways to create increased value by communicating performance advantages and environmental impact reduction to downstream entities. Because they have not included societal actors in their efforts to define sustainability, the firms face significant risk that their sustainable value propositions may not endure without further innovations in creating accountability systems.