Linking Frugal Innovation and Sustainable Development: Leveraging Corporate Accountability Mechanisms

Frugal innovation involves the development of products and services through creative, low-cost, resource-constrained and flexible approaches with the potential to enhance sustainable development. This chapter considers the motives and risks related to two major approaches to frugal innovation: top-down (corporate-controlled) and bottom-up (grassroots-driven). Drawing on the corporate accountability and governance literature, we compare and contrast the role played by mechanisms such as stakeholder engagement, strategic sustainability planning, and organisational disclosure practices in managing the risks related to developing innovations in a transparent and responsible manner. Two contrasting real-life case examples are utilised to study how corporate accountability mechanisms within organisations can support their claims of frugality and their claims to value adding to the goals of sustainable development. Our findings indicate the use and level of sophistication of corporate accountability mechanisms can either enhance or hinder the growth and the intended impacts of frugal innovations. We provide several suggestions for further research in this area.