Sustainable innovation can be defined as an advancement or improvement of a company's products, services, or processes which will have a positive social and environmental impact and at the same time create profit or economic benefit for the company. Inventions can be defined as technical improvement of a product or a process and are deemed to be patentable if they have an industrial application, is novel, non-obvious, and falls under patentable subject matter. Sustainable innovation of a company’s process often translates to sustainable business model innovation. According to Bocken et. al sustainable business model involves value creation, value capture and value delivery (Bocken, Schuit, & Kraaijenhagen, 2018). Sustainable business model innovation involves complex and systemic tasks and at times is equated to circular business models where the value creation, value capture and value delivery incorporates reusability and recycling. Hernandez et.al introduces a conceptual framework of an integrated sustainable business model and intellectual property (IP) canvas (Hernández-Chea R, 2020). The conceptual framework is aimed at bridging gap of how to integrate intellectual property, including patents, into sustainable business models.
Ever since India opened for economic liberalisation and became part of the World trade organization (WTO) and signed the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement in 1995, India has witnessed technological advancement. The tenth annual U.S. Chamber International IP Index 2022 ranks India at 44th rank among the top 55 countries who have fared well in intellectual property rights. In 2016, Indian government introduced the startup India program where more than 60000 startups have benefited. Joshi et. al, discusses the startup emergence within applied universities in India. Of particular importance is the Indian Institute of Technology, Madras and National Chemical Laboratory, Pune. The paper analyses the pre-incubation level processes that have resulted in enhanced opportunity recognition potential. The authors explore the process from pre-incubation level and refer to the startup incubators that are situated in these universities (Kshitija Joshi, 2021). Panda and Joy emphasise the importance of IP based debt lending for startups and the need for change in the role by Indian banks (Bibekananda Panda, 2021).
To study the patent landscape having sustainable innovations, we analysed 391 startups funded by Alternative investment funds (AIF)- Fund of Funds for startups (FFS), under startup India from the period 2016 to 2020. We analysed funded startups who have filed at least one patent at the Indian Patent Office. Specifically, we did search in the Indian patent Office database to see if patents disclose environmental sustainability or social sustainability in the description or claims section.
Innovations having environmental impact
We define patents with environmental sustainability impact to be in any one of the following applications
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Renewable energy
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Recycling – down cycling
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Water consumption or water saving
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Inventions around greenhouse gas (GHG) emissions or reduction of harmful gases.
Innovations having social impact
Secondly, we selected patents that disclose social sustainability in any one of the following applications
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Reusability – up cycling or circular economy
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Energy saving or Energy sharing economy.
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Subscription based models or access economy.
Out of the 391 startups analysed who received funding, 16 filed for patents, out of which 5 startups filed patents having either environmental and/or social impact. Table 1 lists the patent domains of the startups, the funding received, and the ESG impact of patents.
Table 1: Startups with patents having ESG impact
Patent Domain | Environmental impact | Social impact | Funding (USD) |
Chemical | Yes | Yes | 1356114 |
Mechanical | Yes | Yes | 527647 |
Electrical | Yes | No | 424544 |
Bio-medical | Yes | No | 376024 |
Communication | No | Yes | 181947 |
Computer Science | No | Yes | 52158 |
One can observe from Table 1, that an ESG compliant startup from the chemical industry, which is traditionally associated with lower ESG scores, has received the highest funding when compared to firms from other domains who are also ESG compliant. Another observation is firms that were compliant to both environmental and social sustainability received higher funding than the firms that scored on any one of environmental and social sustainability.