Sustainability-Oriented Innovation in the Minerals Industry: An Empirical Study on the Effect of Non-Geographical Proximity Dimensions

Abstract

Minerals mining and processing companies (hereinafter referred to as “minerals industry”) face the increasing demand for a comprehensive approach towards innovations aimed at sustainability. While the ability to learn from external sources of knowledge is at the core of this process, lack of geographical proximity and multiplicity of external sources impose challenges for mineral companies in this respect. The present study proposes that organizational, institutional and cognitive proximities could provide a platform for this industry to overcome those challenges, thereby achieving a superior innovation performance across various sustainability dimensions. Results of an analysis based on a sample of 101 mineral companies in Norway reveal that these dimensions of proximity are conducive to process, product and social innovation in different ways. More specifically, organizational proximity (diversity of non-local collaborations) and informal institutional proximity (shared cultural norms and values) spur social innovation. Furthermore, formal institutional proximity (similarity of rules and laws) and cognitive proximity (familiarity of knowledge base) support both process and product innovations. This paper provides some insights on the determinants of innovation in sustainability contexts, and contributes to the recent debate on the role of non-spatial proximity dimensions for innovation in the peripheral regions.