Overview and data collection
At the core of our WWS typology is the concept of the value-consumption chain introduced above. We have incorporated a value-consumption chain analysis because it allows us to address the fundamental question: ‘Which consumption activities can be addressed through economically viable production processes that, considered together, contribute to mitigating or adapting to climate change?’ The value-consumption chain concept thus links consumption and production activities relevant to climate change through focusing on the different actors carrying them out.
For simplification, we denote the use of final products by both households and the state as ‘consumption’, which differs from the national accounting methodology that distinguishes between state investments and consumption. Further, we include in household consumption the acquisition of capital goods by households (e.g. residential buildings), which also differs from national accounting conventions, which classify such activity as belonging to the commercial sector.
Placing the value-consumption chain at the centre of our analysis gives rise to three key conditions that must be fulfilled for a climate-relevant WWS to be obtained:
The value-consumption chain must entail an economic win for the implementing actor (also defined in Sect. 2.2.3);
The value-consumption chain must entail an overall ecological win, addressing either climate change mitigation or adaptation (defined in Sect. 2.2.4).
The value-consumption chain must entail an economic win for the consuming actor, or at least, not an economic loss;
The first condition is crucial to value-consumption chain analysis because it is required for the implementing actor to initiate her or his socioeconomic activity. The second condition is by definition required of any climate-relevant WWS. Further, a specification of the overall ecological win in the value-consumption chain allows us to locate where in the chain, and through which activities, the ecological win manifests itself. The third condition is crucial to the existence of the value-consumption chain because it is what drives production processes, making them viable. Analysing whether all three of these conditions are met in a value-consumption chain brings the analytical focus of WWS to the actor-specific activity level, which is not otherwise addressed in the literature.
Our typology was developed by analysing economically viable socioeconomic activities that have the potential to contribute to a sustainability transition addressing climate mitigation and adaptation goals. Within the transdisciplinary Horizon 2020 project Green-Win, 46 different socioeconomic activities were identified within three action fields, coastal zone flood risk management, urban transformations and energy poverty eradication and resilience, and these activities were further supplemented by a review of the literature. Based on thus identified real-world examples of win-win strategies, we developed a ‘conceptually-derived’ typology which ‘defines completely the set of ideal types’ of win-win strategies (Doty and Glick 1994). Thus, in Sect. 3 below, we present the typology and illustrate each type through WWS examples identified in Green-Win or in the literature. For some conceptually derived types, real-world examples could not yet be identified, and we discuss this, i.e. the ‘empty cells’ in Tables 1, 2 and 3 in Sect. 4.
Following the guideline for constructing a typology proposed by Doty and Glick (1994), we define the set of dimensions (criteria) that describe completely each ideal type of a WWS. We identify four essential dimensions in which the WWS differ:
Economic win and
A further distinction that is helpful in describing WWS is one between different types of goods and services used in the value-consumption chain. While it is not an essential top-level dimension of our typology, it is helpful for more precisely describing different socioeconomic activities that may lead to a WWS. For clarity, we first discuss these different types of goods and services before presenting the dimensions of the typology.
Specifications of goods and services
We use the term products to refer to both goods and services and distinguish between three general types of products, two related to mitigation (i.e. the reduction of greenhouse gas emissions) and one to adaptation (i.e. the reduction of climate-related risks) (see Sect. 2.2.4) (IPCC 2013). Products, in general, encompass energy and non-energy resources, preliminary goods, capital goods as well as durable and non-durable consumption goods.
Ecological wins result from innovations concerning the production, use or consumption of products and are related either to ‘product features or use, […] [or] to production process improvements or clean technology initiatives’ (Pujaria et al. 2003). We follow this and differentiate for mitigation between sustainably produced products (SPP) and sustainably used products (SUP). The former is a characteristic the product inherits from its production process, while the latter is a characteristic of its utilisation.
SPP, such as renewable energy or recycled paper, encompass energy and non-energy resources, preliminary products, durable and non-durable consumption goods as well as capital goods that are produced with less ecological impacts. Further, services that qualify as SPP are provided with less ecological impacts, typically through utilisation of SUP by the supplier of the service.
SUP like capital or durable consumption goods have lower environmental impacts during their utilisation, such as insulation, renewable energy generation facilities or energy efficient white-ware (e.g. refrigerators). Typically, they are the result of product innovations. Further, services that qualify as SUP enable customers of these services to reduce the environmental impact of their actions. These services are, for example, related to the use of SUP by the customer of the service and/or encompass further process innovations. We note that the categories SPP and SUP are not mutually exclusive. An SUP may also be an SPP, as an SUP may be produced in a ‘sustainable’ way. Whether or not this is the case, is an empirical question to be addressed by analysing the specific value-consumption chain in question.
For adaptation measures, we consider adaptation products, which include capital and durable consumption goods (e.g. dikes) that reduce potential damages from climate change (e.g. increased flood damages from sea-level rise) and services, such as consulting or insurance, that support households, companies or the state in adapting to climate change.
Dimension 1 and 2: actors and actor-specific activities
For actors, we distinguish between companies, households and the state, whereby we assign each of them specific general activities, following their individual target: companies produce, households consume, and the state makes expenditures and conducts policy. Our focus is on activities related to the real sector and we do not consider activities related to the financial sector, such as financial investment, funding or borrowing.
We take into account different types of ecological wins that may result from socioeconomic activities. For the characterisation of such activities, we specify categories of actions for all actor types: four for companies, and three for consumers and for states, respectively.
The four action categories for companies are production input, production process, production output, and production recirculation.
The three action categories for households are consumption input, consumption process, and consumption output.
The three action categories for states are expenditure input, expenditure process, and the conduct of policy.
The production of goods and services, i.e. products, consists of a process that uses inputs and generates outputs (Hitt et al. 2011). We choose this demarcation to describe the different ecological wins and discuss their origins and the location in which ecological wins manifest along the value-consumption chain (Hohmeyer and Koschel 1995, presented in Rennings 2000).
Companies can use process innovations for making their outputs more sustainable, i.e. leading to SPP as described above. These process innovations can relate to the inputs of the production process and to its conduct.
Production input-related company WWS refer to the utilisation of SPP in a company’s production, which are manufactured (or extracted) upstream in the value chain. Companies decide on production inputs, such as energy and non-energy resources and preliminary goods and services. Eco-innovations on the input level may, for example, involve substituting traditional products for SPP, and thus lead to a substitution of ‘ecologically harmful inputs’ (ibidem).
Production process-related company WWS refer to process innovations that reduce the ecological footprint of the production process. Within the production process, specific technologies, capital goods, services and methods are applied. For mitigation-related ecological wins, the output of the company under consideration receives its ecological characteristics from the processes within the company through, for example, utilisation of SUP, such as energy efficient machinery (Bocken and Allwood 2012). This ecological effect will be passed down the value-consumption chain. For adaptation, ecological wins that arise from a production process WWS result from the utilisation of adaptation products. These wins remain in the company under consideration and reduce potential climate change-related impacts on the company.
Production output-related company WWS refers to product innovations (sustainable innovations as discussed in Boons et al. (2013)) related to new or adapted SUP (e.g. electrical vehicles or rooftop PV solar equipment). Companies can use product innovations for making their products more sustainable in their subsequent use, i.e. SUP. Ecological wins from product innovation arise downstream from production in the value-consumption chain, where these SUP are applied. Such SUP also include services that exhibit positive ecological effects for the user of the service, thus realising its ecological impact through enabling other socioeconomic actors (i.e. SUP service users) to implement a win-win strategy.
Finally, production recirculation encompasses the re-use of by-products or waste from production processes or consumption. Thus, production recirculation-related company WWS refer to the utilisation of end-of-pipe technologies or recycling and waste disposal.
Households consume durable and non-durable goods and services, and they generate waste. We distinguish between three consumption categories leading to household WWS (see Table 2). Consumption input-related activity refers to the consumption of SPP, primarily non-durable goods, e.g. renewable energy, as well as services. Consumption process-related activity refers to the use of SUP (durable goods, e.g. renewable energy production facilities and services) and adaptation products (durable goods as well as adaptation services). We thus distinguish between mitigation-related and adaptation-related ecological wins that result from this kind of activity. Mitigation-related positive ecological effects result from a reduction of resource needs during use of a specific durable good, such as energy-efficient heating or lighting (Poortinga et al. 2003), green roofs (Oberndorfer et al. 2007) or the enablement of energy generation through rooftop PV-solar or micro-wind turbines (Bahaj et al. 2007). Adaptation-related ecological effects result from the utilisation of adaptation products, which include durable goods, such as protection devices against floods (Osberghaus 2015), or services that help actors adapt to climate change. Consumption output-related activity refers to the avoidance of waste, its reintroduction back into production processes or waste disposal.
Distinguishing between these three consumer activities is relevant due to different resulting ecological wins. SPP such as non-durable goods and sustainably produced durable goods receive their positive ecological characteristics, e.g. lower resource and energy consumption, from production processes upstream in the value-consumption chain. In contrast, SUP have ecological effects, e.g. reducing greenhouse gas emissions, during their use.
The state makes expenditures that, similar to household activities, consist in purchasing non-durable and durable consumption goods, capital goods, such as infrastructures, and services. Expenditure input-related activities refers to the state consumption of SPP (e.g. renewable energy or recycling paper), typically in the course of public procurement. Ecological wins arise upstream from the state in the production of these SPP. Expenditure process-related activity refers to the purchase of SUP as well as adaptation products (typically capital goods or adaptation services). Ecological wins arise from the use of these SUP (e.g. cars, infrastructure, consultancy services) or adaptation goods, typically capital goods, such as dikes.
Further, the state conducts policy. Policy-related activities strive for ecological wins resulting from activities other socioeconomic actors perform based on the policy instruments implemented by the state. We note that policy can be further distinguished according to different types of policy instruments used, i.e. regulation, economic incentives (e.g. support schemes) or communication. Such distinctions are useful for assessing the efficiency of different instruments in enabling a WWS in a given context, for example, whether regulation or support schemes are more cost-efficient in inducing green growth through increased renewable energy production. However, for reasons of space we will not discuss this in further detail. Rather, our typology provides an entry point for such analysis (see Sect. 4).
Dimension 3: actor-specific economic wins
Each economic win reflects an improvement of economic parameters compared with the status quo resulting from the implementing actor’s activity. By the additional specification driven, we indicate that each activity is driven by the intended economic win the actor strives for.
Company economic wins
Companies generally undertake activities in order to achieve positive business effects (Lüdeke-Freund et al. 2017). Positive business effects result in an increase in companies’ profits, whereby the economic win can result from a decrease of costs or an increase of revenues (Lüdeke-Freund et al. 2017). We therefore distinguish between cost-reduction-driven win-win strategies and revenue-increase-driven win-win strategies of companies.
Cost reduction results from activities related either to the inputs of the company under consideration or to the processes of value generation. The former is associated with usage of less costly inputs, the latter relates to process innovations that enable a reduction of production costs, including product innovations that in turn lead to less costly production processes. Further, costs can be reduced through recirculation of production waste (see Table 1). Activities aimed at cost reduction rely on the consumer not being made worse-off by the eco-innovation and thus continuing to consume the product at least at similar price levels and quantities.
Revenue increase results from sales of products, induced by receiving higher prices or selling more. This is relevant for a company that through eco-innovation aims to either increase sales of an existing product or introduce a new product to the market. Activities aimed at revenue increase assume that the final product of the company under consideration will be now preferred by the final consumer: either the product of the company has a lower price (compared with competitors) or consuming the product causes a higher utility—in this case due to its ecological characteristics—for the customer.
Household economic wins
Households consume goods and services, which generate utility (Neary and Roberts 1980). We distinguish between two consumption activities that generate economic wins, whereby the first influences the utility directly and the second indirectly. A household can substitute less-preferred goods by more-preferred ones. This increases household utility directly and reflects a utility-increase-driven strategy. In contrast, a household can strive for a reduction of costs associated with the consumption of one good through either a decrease of quantity or a substitution for a less expensive good. Both enable an expansion of all other consumption quantities and therewith an indirect utility increase. We label such strategies cost-reduction driven.
State economic wins
We focus only on one economic win the state can strive for, namely cost reduction.
Cost reduction refers to economic wins that follow from strategies of the state striving for the reduction of (budget) costs or cost reductions resulting from policy design and implementation, e.g. regulation and law making.
In principle, the state can also pursue a strategy of ‘economic growth’, itself an economic win. In the climate-related WWS domain, such a strategy is known as green growth, which we understand as making ‘growth processes resource-efficient, cleaner and more resilient without necessarily slowing them’ (Hallegatte et al. 2012). However, whether or not such an economic win materialises depends on macro-economic factors, including the indirect effects of investments, R&D, technological learning and learning-by-doing. Here, we do not consider the macro-economic perspective and therefore, we do not analyse such WWS.
Dimension 4: ecological wins
Each ecological win reflects an improvement of ecological (mitigation or adaptation) parameters compared with the status quo resulting from the implementing actor’s activity.
We focus on ecological wins that relate to climate change. In this context, we define mitigation-related ecological wins as positive ecological effects that reduce climate change through greenhouse gas emission reductions and adaptation-related ecological wins as effects that reduce the negative impacts of climate change (IPCC 2013).
Finally, we note that further distinctions are possible within each of the four essential dimensions described here. Such further distinctions concern, for example, the time horizon of an economic and ecological win, or the type of policy instrument applied by state actors. However, due to space limitations we cannot go into each of these and limit ourselves to the categories that comprehensively cover the 46 socioeconomic activities identified in Green-Win and relevant literature and the related conceptually derived classes.
The value-consumption chain: Economic and ecological connection of win-win strategies
Before presenting each type derived from the above presented 4 dimensions though WWS examples, we first present an elaborated example of a value-consumption chain to illustrate its applicability in identifying WWS and their interconnections.
As defined above, for a particular WWS, one economic win arises for the implementing actor, whereas the ecological win can arise anywhere along the value-consumption chain: in the activities of the implementing actor, or upstream (i.e. in activities that precede those of the implementing actor) or downstream (i.e. in activities that follow those of the implementing actor) in the value-consumption chain.
A specific WWS typically induces at least one further socioeconomic activity—connected along a common value-consumption chain—that for their part is also a WWS. If two socioeconomic activities conducted by two independent actors are connected along a value-consumption chain, and these activities generate economic wins for both implementing actors and the consumer (or do not make the consumer worse off), and simultaneously enable an ecological win somewhere along the value-consumption chain, then both are win-win strategies.
Figure 1 presents an example of such interconnections of WWS based on a case study in the Green-Win project. The WWS under consideration concerns a company distributing organic coffee roasted with biogas instead of fossil fuel energy. Looking upstream from the company in the value-consumption chain, the company purchases roasted coffee from local farmers; coffee farmers use biogas for the roasting process, which is generated by livestock farmers; these livestock farmers generate biogas from manure using biogas bags, which are in turn produced by a manufacturing company. Looking downstream from the company in the value-consumption chain, households consume the final product—coffee.
As shown in Fig. 1, two ecological wins take effect. First, an ecological win occurs in the activities of the livestock farmers, who generate biogas from manure, and thus reduce methane emissions from farm waste. Second, an ecological win occurs in the activities of the coffee roasters, whose production process involves a sustainably produced fuel (i.e. an SPP). We can thus identify five WWS, four for companies, and one for households. For companies, we see four revenue-increase-driven WWS. The one at the beginning of the value-consumption chain, the production of biogas bags, is a production output-related WWS (Type , see below). The next one, the use of manure to generate biogas, is production recirculation-related (Type , see below). The production of organic coffee is based on a process innovation — substitution of conventional fuels by biogas — and is thus production input-related (Type , see below). The eventual distribution of coffee is also production input-related (Type , see below). Households follow a utility-increase-driven WWS of Type , see below.
This example illustrates the focus on the identification of actors and activities in (interconnected) WWS that is enabled by value-consumption chain analysis. Next, we present the full WWS typology through identified real-world examples. In our examples, we further point out where other WWS are interconnected through the value-consumption chain. We then discuss the implications of value-consumption chain analysis for WWS identification and enhancement and our findings regarding real-world WWS examples.