Innovating for Net-Zero: Collaborative and Digital Decarbonisation Strategies in Sunset Industries' Global Value Chains

Abstract

Global net-zero ambitions require transformative strategies to decarbonise carbon-intensive global value chains (GVCs). This study examines how multinational enterprises (MNEs) in sunset industries integrate carbon capture technologies (CCT) with operational and supply chain dynamics (OSCD) to advance decarbonisation. Drawing on institutional theory (InsT) and dynamic capabilities theory (DCT), we investigate how external decarbonisation pressures activate internal capability routines that shape the adoption of technological and supply chain innovations. Using qualitative insights from 55 industry professionals across energy-intensive sectors, we analyse how firms navigate regulatory fragmentation, mobilise early-stage decarbonisation investments and develop collaborative and digital mechanisms to support low-carbon transitions. The findings reveal that coercive and normative pressures primarily stimulate sensing and seizing capabilities, while transforming capabilities develop more gradually through experiential learning and organisational reconfiguration. Firms often pursue hybrid CCT–OSCD strategies, combining technological interventions with operational and supply chain adjustments to manage institutional complexity. This study contributes theoretically by offering an integrated InsT–DCT framework that explains how institutional constraints and dynamic capabilities interact to enable decarbonisation in sunset industries. Managerially, the findings identify priority capability areas, including policy sensing, digital resource mobilisation and supply chain reconfiguration that can accelerate decarbonisation across global value chains.