Confronting the grand challenge of environmental sustainability within supply chains: How can organizational strategic agility drive environmental innovation?

Abstract Supply chains are interconnected, globally distributed, and complex systems that significantly impact the environment and human civilization. Achieving environmental sustainability in supply chains is a grand challenge that requires collaboration and innovation among multiple stakeholders. In this study, we combine the natural‐resource‐based view and the stakeholder‐resource‐based view (SRBV) to examine how organizational strategic agility can foster collaborative environmental innovation and enhance environmental sustainability in supply chains. We use data from 758 managers from 185 firms in Turkey, an emerging economy context. We find that organizational strategic agility, enabled by organic organizational structures and regional innovation initiatives, leads to more collaborative environmental innovation with supply partners and higher environmental sustainability performance. Our study contributes to the literature on grand challenges, organizational strategic agility, and innovation management by showing how for‐profit firms can leverage their strategic agility to address the grand challenge of environmental sustainability in supply chains. We also find two interventions to promote this form of environmental innovation: developing organizational strategic agility and organic structures within firms and involvement in regional innovation initiatives to stimulate collaborative innovation for environmental sustainability among supply partners.