Sustainable Product Innovation and Institutional Awareness in Ready-Made Garments Firms

Awareness, Practices, and Product Innovation

Driven by both global market demands and local socio-environmental challenges, institutional awareness and practices towards sustainability have become increasingly vital in the RMG industry. Manufacturers are compelled to incorporate eco-friendly elements and practices to maintain competitiveness, driven by a growing awareness of the importance of sustainable products among international buyers. This includes key elements such as market research, global sustainability standards, and transparent communication of sustainability. There is an integration of sustainable materials and production processes that are focusing on reducing the environmental footprint at the product development level—sourcing of raw materials (e.g., organic or recycled materials), using water and energy-saving tools, putting waste-cutting plans into action, and workers’ rights. Support from trade groups, government bodies, and schools plays a key role in encouraging new ideas in the culture of the clothing industry (Khattak, 2019; Sarkar et al., 2020). When stakeholders and global groups collaborate, they increase awareness about new products and promote eco-friendly practices. Factors such as adhering to rules, utilizing technology, expanding into new areas, and effective selling have a significant impact on the long-term growth of the RMG industry (Liu et al., 2019).

To synthesize market trends, customer demands, and certifications into a coherent theoretical framework, expand the conceptual framework section in the paper. Incorporate market trends, customer demands, and certifications to understand how global and local trends influence sustainable practices and product innovation. Link certifications to validate and incentivize sustainable practices, and use existing theoretical models like SLCM or TSPD to establish a unified framework (Lawrence et al., 2016).

In Bangladesh, the RMG industry backs institutional practices by getting LEED certification. LEED highlights green investment ideas of eco-friendly tech and a sustainability-focused company culture. This covers a wide range of key parts like planning for long-term sustainability, training staff, involving stakeholders, and keeping an eye on performance. Institutions such as the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Innovation Center promote sustainability by providing resources and fostering innovation (Islam & Halim, 2022). Besides, certification schemes like GOTS and OEKO-TEX® further support sustainable production by helping consumers identify environmentally and socially responsible products (Ali et al., 2020). Consequently, companies are expected to establish a systematic incentive (or disincentive) and monitoring system to support sustainability measures. Companies are expected to adopt a standardised “toolbox” for incorporating sustainability-related information into product decision-making processes (Hallstedt et al., 2010). These structured approaches validate Hallstedt et al. (2020)’s TSPD framework effectiveness, but our findings reveal a crucial adaptation: Bangladeshi firms integrate traditional lifecycle thinking with digital innovation tools, creating hybrid approaches that may offer insights for other developing economy contexts

Besides, innovation in sustainable materials and practices is crucial for addressing environmental concerns and complying with regulatory requirements, enhancing brand reputation, and ensuring the sector’s future growth (Khan et al., 2022; Niaki et al., 2019; Sarkar et al., 2020). In fact, the fashion industry’s landscape has been reshaped by extended reality technologies, including virtual and augmented reality, along with artificial intelligence (Kolasani, 2024). The industry is leveraging technologies such as 3D printing, AI-driven design software, and virtual reality to revolutionize the supply chain, from design to retail (Casciani et al., 2022). Experts view eco-friendly innovation as a key driver in guiding countries toward a greener and more prosperous future. In fact, sustainability has a big impact on driving innovation, with companies like Patagonia taking the lead by using recycled materials and fair work practices (Rattalino, 2018).

Sustainable Innovation in Developing Economies and Textile Manufacturing

Recent scholarship has expanded our understanding of sustainable innovation pathways in developing economies, particularly in the textile sector. Hossain and Rahman (2025) found that green manufacturing research in textiles has evolved from basic compliance approaches to sophisticated systems thinking integration, with developing economies like Bangladesh, Vietnam, and India emerging as critical research contexts. Hebaz et al. (2024) identified institutional pressures driving green supply chain management practices, revealing that regulatory pressures, customer demands, and competitive pressures create a hierarchy of influence that varies between developed and developing economies. Rahman et al. (2025) identified persistent challenges in low- and middle-income countries, including limited material circularity, inadequate technological infrastructure, and insufficient stakeholder collaboration mechanisms.

Institutional Pressure Mechanisms and Green Certification Effectiveness

Alinda and Kaawaase (2025)’s research on institutional pressure mechanisms has revealed that coercive pressures have the strongest direct effects on organizational awareness, while mimetic pressures prove more effective for practice implementation. This nuanced understanding challenges assumptions about uniform institutional pressure effectiveness. Green certification schemes have emerged as critical institutional mechanisms for sustainability transformation, with Lin and Ma (2023) study revealing significant variations in effectiveness between developing and developed country contexts. Certifications like GOTS and OEKO-TEX show stronger institutional legitimacy impacts in developing economies, serving as crucial market access mechanisms. A study on circular economy adoption in Pakistan’s textile industry identified institutional certification as a key mediating factor between external pressures and internal transformation processes (Farrukh et al., 2025). The analysis of Karim et al. (2024) refers to sustainable supply chain management factors in textile industries that revealed that institutional pressures create cascading effects throughout value chains, with certification schemes serving as critical coordination mechanisms. This research demonstrates how institutional theory mechanisms operate at multiple organizational levels simultaneously.

Low-Carbon Manufacturing and Sustainability Practices in Global Textile Industry

A systematic review on circularity in textile waste highlights the importance of emerging technologies in closing material loops in developing economies (Biyada & Urbonavičius, 2025). United Nations Environment Programme (2023) posits that circular business models could generate $700 billion in economic value by 2030, with each 1% increase in market share resulting in a 13 million tCO2e reduction in emissions. The European Union’s comprehensive textile policies in 2024, including the Corporate Sustainability Due Diligence Directive (CSDDD), mandate companies to address negative impacts throughout their entire value chains, extending responsibility to raw material extraction stages. These regulatory frameworks represent sophisticated coercive isomorphism mechanisms that transcend national boundaries. Industry 4.0 technologies, such as blockchain, artificial intelligence, and digital twins, are reshaping sustainability practices through enhanced transparency and efficiency, addressing long-standing challenges in textile supply chain sustainability.

Bangladeshi RMG Industry

In the 2021 to 2022 fiscal year, Bangladesh made $42 billion from exporting RMG keeping its spot as the world’s second biggest RMG exporter with a 7.9% share of the global market. The BGMEA reports that the RMG industry accounts for approximately 84% of Bangladesh’s total exports and employs around 4 million people. Rahman and Raju (2022) highlighted the sector’s strengths on the supply side. Still, they identified a need for better supply chain management on the demand side, whereas Shahen (2022) examined the life patterns of textile workers during the COVID-19 pandemic. Hossain et al. (2022) explored how stakeholder integration and green investments influence environmental sustainability in Bangladeshi textile SMEs, which is moderated by green technology adoption. There is a need to integrate corporate social responsibility (CSR) with product innovation policies (Mahmud et al., 2020; Saha et al., 2021; Wong & Kim, 2023), and the need for further research on CSR implications in the RMG industry (Azmat, 2015).

Businesses approach and implement eco-conscious approaches to help factories understand the importance of green practices, such as the use of earth-friendly materials, energy-efficient machines, and techniques to reduce waste. When companies incorporate these practices into their plans, it creates an environment where things continue to improve and new ideas emerge. It’s worth noting that 56 of the top 100 LEED-certified green factories in the world are in Bangladesh. This includes nine of the top ten. By going after LEED certifications, Bangladesh’s clothes industry is setting the bar for taking care of the earth.

The RMG industry, particularly in Bangladesh, has made strides toward sustainability, yet significant gaps remain in integrating sustainable practices into product innovation (Saha et al., 2021). Recent studies emphasize the role of institutional support, including certification schemes like GOTS and OEKO-TEX®, in fostering eco-friendly manufacturing practices (Islam & Halim, 2022). Moreover, leveraging advanced technologies such as AI and 3D printing has proven transformative in aligning product development with global sustainability standards (Casciani et al., 2022). Despite these advancements, comprehensive frameworks, such as those proposed by Hallstedt et al. (2020), are necessary to ensure systemic integration of sustainability principles.

Institutional Theory Applications in Sustainable Product Innovation

A research on the impact of China’s Low-Carbon City Pilot on manufacturing firms’ biodiversity concerns highlights the complex pathways through which coercive isomorphism operates in practice (Nie & Zhang, 2025). The integration of institutional theory with strategic frameworks has garnered attention, providing a comprehensive framework that links institutional pressures, green knowledge, and innovations to sustainable performance. The study demonstrates how institutional awareness mediates the relationship between external pressures and internal transformation processes. Emerging research has identified leadership as a critical moderating factor in the effectiveness of institutional pressure, particularly in developing economies where resource constraints limit implementation capacity.

Research Design and Framework

In order to obtain appropriate and sufficient empirical evidence from the study, this study focuses on the following two stages of organisational strategic planning on of Sustainability Principles (SPs) (Ny et al., 2008; Saha & Seal, 2011): (a) Baseline mapping—to identify current critical sustainability issues, business implications, and opportunities for change; and (b) Creative solutions—to develop strategies that align with their vision of sustainability and ensure each action contributes to long-term goals. To strengthen the logical flow of this study, the Template for Sustainable Product Development (TSPD) was employed to identify the product development in related to sustainability problems, benefits, and solutions (Hallstedt et al., 2010; Hallstedt et al., 2013; Ny et al., 2008). This study also integrates SLCM to analyse the life cycle of the RMG industry. SLCM facilitates the brainstorming of sustainable solutions and leads to prioritised actions via the identification and evaluation of potential measures (Ny et al., 2008).

Figure 1 illustrates the analytical framework of this study. TSPD is instrumental to layout the sustainable product innovation and gaps analysis in the frame of Market–Product–Enterprise in both the current and future settings. Meanwhile, SLCM provides an in-depth analysis of the product-based innovation based on the construct of socio–technical environment of Sustainability Principles (SPs). Following this framework, the interview scopes and questions are designed to gather field data through key informant interviews (KII) and focus group discussions (FGD). This research design is useful for enhancing decision-making, communication, and understanding between sustainability experts and organisations, and for identifying improvements in achieving sustainable product innovation. Specific research instruments have been established to operate this analytical framework for data collection (see Section “Research Instruments”).

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Figure 1.

Analytical framework.

Institutional Theory is a paradigm that helps organizations adapt to external forces and incorporate these influences into their strategies, practices, and procedures. It highlights three mechanisms of institutional isomorphism: coercive, mimetic, and normative. Coercive isomorphism arises from external forces, mimetic isomorphism results from imitating the successful sustainability methods of industry leaders, and normative isomorphism stems from professional standards and stakeholder participation. Institutional awareness and practices provide operational dimensions within this paradigm. The analytical framework enhances Figure 1 by integrating Institutional Theory into the SLCM and TSPD frameworks. The integrations are as follows:

This theoretical integration focuses on the role of institutional awareness, institutional practices, and institutional leadership in driving sustainable product innovation. The study identifies coercive and normative isomorphism as external pressures that enhance organizational awareness of sustainability requirements. Mimetic isomorphism drives adoption of proven sustainability practices, and institutional leadership serves as a moderating mechanism. The causal pathway model suggests that coercive isomorphism positively influences awareness, normative isomorphism enhances understanding of sustainability benefits and market opportunities, and institutional leadership mediates the relationship between awareness and the implementation of practice. This comprehensive paradigm integrates the three pillars—awareness, behaviors, and leadership—with SLCM’s socio-technical-environmental constructions and TSPD’s market-product-enterprise aspects, so enabling the systemic incorporation of sustainable principles.

Research Instruments

The qualitative data collection—KIIs and FGDs, were based on the following two instruments:

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Table 1.

Case Study Guide—Templates for Sustainable Product Development (TSPD).

Step	Template for sustainable product development (TSPD)
	Market desire/needs	Products / concepts	Extended enterprise
[Current] Baseline mapping - current reality	– What market need does the product meet? – What sustainability issues relate to this demand? – How does this demand address human needs?	– How sustainable is your product’s entire life cycle? – What key practices ensure full sustainability? – Where are the major sustainability breaches in the life cycle?	– Which groups of people are against using eco-friendly products? – What is the company doing to deal with these groups’ preferences? – What partnerships are in place along the supply chain, and what obstacles are preventing better sustainability?
[Future] Creative solutions - future opportunities	– What new market demands are expected due to sustainability challenges? – Which new demands in our core business could meet human needs? – Are there market trends in this direction?	– How can we minimise our product life cycles’ sustainability impact? – What methods can we use to ensure sustainability at every stage of a product’s life? – Is it possible to design new, environmentally friendly products that meet today’s and tomorrow’s needs?	– What future preferences of these groups will help promote sustainable practices, and how can we involve them? – What future partnerships could improve sustainability throughout the product’s life? – How can we encourage these partnerships?

Source. Modification from Ny et al. (2008).

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Figure 2.

Product life-cycle analysis—strategic life-cycle management (SLCM).

Selection of Cases

This study analyzes the impact of institutional practices on sustainable product innovation in the Bangladeshi RMG industry. Companies A and B were intentionally selected based on the LEED certification process which denotes Leadership in Energy and Environmental Design. It is an internationally acknowledged certification system created by the U.S. Green Building Council (USGBC) that offers a framework for sustainable, highly efficient, and economically advantageous green buildings. LEED accreditation is applicable to buildings, residences, and communities seeking to achieve sustainability in design, construction, operations, and maintenance.

Company A was LEED-certified and Company B was NOT. This justified the case for institutional examination in investment and outreach practices that create resilience outcomes, contrasting green-certified from traditional manufacturing strategies. Company A demonstrates how the industry is moving towards greener and sustainable practice; however which Company B represents being typical of practices in the RMG sector. Selection depended on a number of criteria (such as company size, production capacity, and market influence). This coming together of two companies reflects wider trends within the Bangladeshi RMG, indicating that green quotient is increasingly becoming part of the global market as well as the environment. Company B is representative of entrenched practice, a metaphor for the troubled present and future prospects sustainability faces. Further possible cases were not required due to suboptimal data availability, interest in participating, or fitting with the scope of this research. The chosen cases further align with the overall visionary purpose of this study in exploring sustainability certification and sharing best practices related to scaling sustainable innovations within a sector.

Data Collection and Analysis

The main information was gathered through personal conversations with relevant people (KIIs) and group talks (FGDs) from August 2023 to April 2024. There were 23 in-person interviews and 4 FGDs with people involved in the clothing industry in Bangladesh. Each person was interviewed for 1 to 1.5 hr, and these interviews were recorded by hand, resulting in 93 pages of written notes. The transcripts generated from the KIIs and FGDs were analysed manually. The transcribing process began with initial coding at level 1 for the categories and sections in the tools. This was followed by triangulation of data and level 2 coding for category development. Level 3 coding was then applied to identify overarching themes. The categorisation process and the themes that emerged were systematically documented. Table 2 provides the profiles of the participants in this study from the two case studies (e.g., Company A and B), as well as experts and consultants from the industry.

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Table 2.

Profiles of Interviewees.

Data code	Areas of expertise	Mode of data collection
Company A
A01, A02, A03, A04, A05, A06, A07	Seamless marketing, merchandising lead, strategic HR, maintenance, admin, and compliance, operations	KII and FGD
Company B
B01, B02, B03, B04, B05, B06	Environment and chemical management, sustainability & QMS, lab and sustainability, operations	KII and FGD
Industry experts / Consultants
E01, E02, E03, E04, E05, E04, E07, E08, E09, E10, E11, E12, E13, S14	Sales and marketing, workplace program coordinator, ethical trading, environmental policy and resources efficiency, academician, R&D and trade, public health professional, industry council	KII

The text outlines the process of integrating a coding framework, which includes identifying theoretical constructs, cross-framework integration, and theoretical validation. It covers institutional theory codes, SLCM dimension codes, TSPD component codes, awareness-practice linkages, leadership moderation effects, and lifecycle integration patterns. It also covers proposal testing, framework synergies, and emergent theoretical insights.

Triangulation, the process includes juxtaposing interview findings with alternative data sources, extracting insights from various stakeholders, employing diverse research methodologies, employing distinct theoretical frameworks, engaging a few research assistants, and conducting subsequent interviews or focus groups to corroborate the findings. Figure 3 indicates the data Coding and analysis process, which is assigned to each of the participants to make the triangulation of the participants’ data. This methodology enhances the strength of findings and ensures the accuracy of explanations.

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Figure 3.

Data analysis flow.

The study demonstrates trustworthiness and reliability through various measures, including data collection reliability, analytical reliability, and triangulation strategies. The systematic data collection process, which includes extended field engagement, multiple methods, and rigorous analysis, ensures comprehensive data gathering. The study employs systematic inter-coder reliability procedures and employs multiple researchers for coding decisions. The study employs multiple forms of triangulation, including data triangulation, methodological triangulation, and investigator triangulation. Participant selection is credible, with strategic case selection based on LEED certification status and diverse participant expertise. The theoretical framework integration is systematic, utilizing the TSPD Framework, SLCM, and Institutional Theory for baseline mapping and the development of creative solutions. Data analysis transparency is achieved through manual transcription and analysis, categorization, thematic development, and pattern validation. The study acknowledges limitations, such as sample size constraints, geographic concentration, temporal limitations, and access constraints. Contextual validity is also acknowledged, with a detailed background on the Bangladesh RMG industry context and recognition of economy-specific challenges in the developing economy. However, the study could be enhanced through more explicit reporting of statistical reliability measures and formal validation procedures.

Trends in Institutional Awareness and Practices

Table 3 presents the key findings regarding institutional awareness of sustainable product development. These findings have been analysed across two thematic areas: (a) knowledge of the product development process, and (b) understanding of the benefits associated with product development. The interviewees highlight the importance of process and product innovation in the RMG industry, systematic approaches to product development for agile and efficient process improvements. They observed a shift towards customer-centric and sustainable product innovation, and the importance of integrating 3D design and sustainable materials through knowledge-sharing events. With respect to understanding the benefits of sustainable product development, interviewees recognise the importance of applying a strategic imperative that is driven by global sustainability concerns, with the aim of cost savings and efficiency while maintaining market relevance through continuous updates and active industry participation.

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Table 3.

Key Findings on Institutional Awareness.

Key aspects	Key results	Selected interview quotes
Knowledge of product development processes	– Recognises improvements in how things are done and follows a structured method. – Combining improvements in processes through teamwork. – Strives to make processes more flexible and effective. – Slowly changing product innovation influenced by major industries. – Focuses on products that meet customer needs during development. – Integration of 3D design processes as a growing trend. – Innovation and sustainability nexus by knowledge-sharing events.	Our organised approach involves participation in innovation meetings, with the “hacking meeting” helping as the initial step. [A05] We are eliminating poly bags and opting for environmentally friendly alternatives, such as paper cartons or fabric bags, as part of our commitment to responsible innovation. [B01] There is a lack of extensive product innovation, but pockets of product development driven by customer needs are evident. [E14]
Understanding of the benefits of product development	– Strategic imperative driven by awareness of sustainability concerns. – Addresses various operational facets: cost and efficiency. – Ensures market relevance and resilient business model. – Addresses ethical considerations in the supply chain. – Emphasises strategic life cycle management—sustainability standards, and raw material cultivation.	To integrate environmentally concerned practices into product development for competitive advantages. [A01] Enthusiastically considers sustainability aspects, safety, and harm reduction throughout the product development process. [B02] We face challenges, especially in the context of water consumption and industrial sustainability. [E13]

Table 4 presents the data capture regarding institutional practices. Two main themes had emerged: (a) adoption of structured product development processes, and (b) utilisation of design tools and technologies. The first theme reveals industry’s focus on organisational structure and a proactive approach to project management and innovation, including critical planning to identify and mitigate risks, plan implementation stages, and maintain structured processes for continuous improvement. During the interviews, people recycled. They emphasized the importance of direct customer interaction, ongoing research to meet their needs, and the development of recyclable products. This helps meet the expectations of customers who care about the environment. They also mentioned that the industry utilizes software for designing new products, combining digital and physical tools, and fostering creative thinking to drive sustainable innovation. They adapt new tools and technologies to fight global warming and lower carbon dioxide emissions. They also utilize sustainable materials and develop innovative products to remain competitive globally.

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Table 4.

Key Findings on Institutional Practices.

Key aspects	Key results	Selected interview quotes
Adoption of structured product development processes	– Structured and positive approach to project management. – Critical planning on risk management and mitigation plans. – Execution plan and continuous improvement work. – Direct communication with and market updates from customers. – Line up with expectations of environmentally conscious consumers.	…structured and formative nature with a systematic follow-up from idea generation to product launch. [A05] We should allow historical nature-based solutions that deliver insights for contemporary sustainable innovation. [E03]
Utilisation of design tools and technologies	– Comprehensive approach combining digital and physical tools. – Cultivate a culture that values individual creativity. – Motivated by global warming concerns and CO2 emissions. – Commitment to sustainability as global competitiveness. – Optimise recycled materials and innovative substitutes.	We appreciate the need for exact equipment to bring innovative ideas into physical manifestation or practical application. [A03] The significance of teamwork and motivation in driving successful innovation adoption. [B04] New technology has significantly enhanced production capacity and quality. [E04]

Institutional (Transformative) Leadership

Table 5 presents the key findings on institutional leadership support aimed at promoting awareness and practices. Four main themes have been derived from the interviews: (a) organisational culture and structure, (b) resource allocation, (c) market pressure and competition, and (d) industry support and collaboration. In general, interviewees believe a strong support for innovation is crucial as evidenced by initiatives like the Cost Optimisation Project (COP) and “Kaizen” awards. This also includes a collaborative culture with cross-functional Quality Control (QC) groups and modern communication platforms for managing buyer-aligned ideas. Moreover, it’s essential to wisely distribute funds between research and development (R&D) and the innovation department to encourage growth and nurture an innovative environment. The discussions also highlighted the contributions of industry groups, including ETI, BKMEA, GIZ, and BGMEA, in advancing sustainable progress. This is achieved through partnerships between companies, schools, government agencies, non-governmental organisations (NGOs), and international collaborators.

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Table 5.

Key Findings on Institutional Leadership Supports.

Key aspects	Sub-themes	Key results	Selected interview quotes
Organisational culture and structure	• Support for innovation	– Multifaceted approach to innovation. – Buyer-oriented innovation and operational needs.	“To building partnerships and giving professionals a chance to exchange ideas.” [A02]
	• Collaboration	– Collaboration and knowledge-sharing. – Cultivates an innovation-centric culture. – Modern digital platforms for communication.	“Keeping a lively and advanced thinking atmosphere, making sure we can correct and stay strong in the face of future challenges.”[A04]
Resource allocation	• Budget allocation	– Allocation of budget between R&D and Innovation. – Product development and budgeting procedures.	“Optimise resource utilisation, enhance efficiency, and align developed products with market needs.” [B03]
	• Skilled personnel and training	– Manage employee skills and performance. – Individual performance and tailored training.	“Our strategy integrates internal efforts, with external collaborations with international NGOs, to enhance capabilities through leveraging internal expertise and external resources.” [A04]
Market pressure and competition	• Competitive pressures	– Customer reaction and encouraging internal innovation. – Transitioning towards circular and renewable raw materials.	“Use sustainable materials by 2025, and products made from recycled materials by 2030.” [E06] Our goal is to decrease our carbon footprint by 2030. [E03]
	• Aligns with consumer demands	– Internal monitoring, evaluation and traceability. – Third-party audits. – Circular economy principles and social sustainability.	“Strategically focusing on product innovation to lower rejection rates, and ensure a good return on investment for sample production.” [E07]
Industry support and collaboration	• Industry associations	– Programmes on awareness, post-disaster initiatives, capacity development, and brand influence. – Soft skills development, eco-friendly factory programs, and technology adoption.	“We participate in various programs, including discussions among different groups… these efforts are centered around sustainable and ethical actions.” [E02]
	• Shared learning	– Multiple stakeholders’ collaboration. – Technical education and skill development support. – Focusing on global rules and improving skill shortages.	“Working with customers… and the work of industry groups in creating knowledge centers and promoting innovation, as well as dealing with issues in international trade and government services.” [E09]

Sustainable Product Innovation

By using the TSPD and SLCM, this study able to gain informative and constructive insights into the strategic moves and commitments of Bangladeshi RMG industry for sustainable product innovation. The following sub-sections recap the salient dynamics of institutional awareness and practices into three aspects: (a) market desire and needs, (b) concepts of product, and (c) extended enterprise.

Concepts of Product

Current concept of production—Table 6 outlines the current scenario and stages of the product lifecycle under the four sustainability principles based on the SLCM.

Future concept of production—Various approaches can be taken to increase the service life of garment industry products and reduce their impact on sustainability principles, for example, sourcing sustainable materials, improving the quality of production, reducing waste, adopting responsible shipping methods, ensuring fair labor standards, supporting recycling programs, and increasing openness and accountability throughout the production chain. Moreover, it is possible to create new product ideas in the RMG sector that meet present and/or future market demands while mitigating the risk of violating fundamental sustainability principles. To achieve this, we can use materials that are environmentally friendly and create products in a way that does not harm the world. The textile industry can generate innovative ideas that align with the principles of sustainable development, ultimately making the business profitable for the world and its people.

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Table 6.

Current Scenario of Product Lifecycle in RMG Industry in Bangladesh.

Lifecycle stages (SLCM)	Sustainability principles (SPs)
	SPI:Materials from the earth’s crust	SPII:Substancesproduced by society	SPIII:Physicaldegradation of earth	SPIV:Human needs
Raw Materials: Materials and chemicals that are used for the product components and/or its production	Use of ground water, energy, conventional cotton, chemical dyes, bleaching agents, finishing agents, synthetic fibres, metal accessories and chemical softeners	Release greenhouse gases, Volatile organic compounds (VOCs), and Particular Matter (PM) by raw materials extraction and processes	Soil contamination, soil depletion, land degradation and habitat disruption	Forced and child labour, unfair wages, health hazard (toxicity exposure), poor working condition, labour rights violations
Production: Production by suppliers of components and materials, and production of products at the own company	Apart from recycled materials used, water, energy and some raw materials violate the principle	Release greenhouse gases, VOCs, and other hazardous pollutants	Land degradation, water degradation, forestry and biodiversity loss by solid waste	No risk of social violations is found in the RMG production aspects
Packaging & Distribution: Transportation of materials, substances and products connected to the products	Recyclable packaging materials are used, but conventional fuel is used in distribution	Emissions of greenhouse gases by transportation	No new water body/ land areas are degraded by transportation of products, or materials	Risk of product storage safety and safe transportation of product, materials, and substance
Use and Maintenance: Activities and design that affect the sustainability impact during the usage and maintenance	Optimisation of water use, energy use are found, and product design is found in this perspective.	No harmful substances that product contains and release during the use	No risk of degradation by physical means	Product is less expensive and comfortable. No risk is found during usage or maintenance.
End of Life: Activities and design that affect the sustainability impact during the end-of-life phase	No significant risk of used materials and substances in the product	Release greenhouse gases when incinerations occur after landfill disposal	The product is reusable, recyclable and decomposable in the soil	No risk is found during end of life phase.

Institutional Awareness and Practice for Industry Transformative

This awareness pattern aligns with institutional theory’s prediction that normative pressures (industry standards, stakeholder expectations) drive organizational learning. However, the gap between Company A and B suggests that coercive pressures (LEED certification) may be more effective catalysts for deep awareness development, challenging assumptions about uniform isomorphism effectiveness. The literature reveals a significant gap in the alignment of current awareness and practices in product development within the RMG sector with sustainability standards. Notably, 56 of the top 100 LEED-certified green factories worldwide are in Bangladesh, including nine of the top 10. This shows that although green industries in Bangladesh can be sustainable, they need to better incorporate sustainable ideas into their products to make more progress. This difference shows that while clothing manufacturers are dedicated to being environmentally friendly, they often don’t fully think about innovation at every step of making their products. The superior awareness levels in LEED-certified companies reveal a critical insight: certification schemes function as institutional legitimacy mechanisms that transform external pressures into internal capabilities. This finding extends institutional theory by demonstrating how formal certification creates organizational learning pathways that informal sustainability commitments cannot achieve.

Given Bangladesh’s dominant position in the global RMG market and its substantial impact on the national economy, there is a critical need for companies to adopt standardized frameworks for incorporating sustainability into their product decision-making processes, as supported by the literature. In terms of knowledge of product development processes, there is an emerging trend in Bangladeshi RGM industry in acknowledging the important of process innovation and maintains a systematic approach to product development. To ensure the seamless integration of process innovation, the processes are supported by collaborative efforts, tailored processes, and dynamic reassessment strategies—all aimed at achieving agile and efficient process improvement. Companies have noticed a slow but clear change, mainly influenced by certain important industries. This change is characterized by a focus on customers when creating products, with a strong emphasis on environmental issues and the utilization of 3D design methods. Additionally, more buyers are choosing sustainable materials, which is helped by sharing information at events. This change is closely tied to the overall push for sustainability in industry and the country’s movement towards green factories, highlighting a strong connection between innovative ideas and environmental care. These structured approaches validate Hallstedt et al. (2020)’s TSPD framework effectiveness, but our findings reveal a crucial adaptation: Bangladeshi firms integrate traditional lifecycle thinking with digital innovation tools, creating hybrid approaches that may offer insights for other developing economy contexts.

The industries understand that product development serves as a strategic imperative driven by the company’s awareness of global sustainability concerns and its commitment to innovation. It strategically addresses various operational facets to achieve benefits such as cost savings and increased efficiency, all while maintaining a strong focus on sustainability. The industries understand that product development serves as a strategic imperative driven by the company’s awareness of global sustainability concerns and its commitment to innovation. It strategically addresses various operational facets to achieve benefits such as cost savings and increased efficiency, all while maintaining a strong focus on sustainability. This strategic approach ensures business effectiveness through continuous improvement, employee understanding of internal change, and collaboration between business and research. Ultimately, product development is crucial to a company’s success in a competitive procurement industry, resulting in enhanced business efficiency. According to the participants’ understanding, the company's production process includes various measures to promote sustainable development, such as water conservation, the use of materials that are not suitable for the environment, and the management of wastewater. They emphasized the importance of innovation, cost-effectiveness, and consumer preference, and then discussed the issues related to regulating production. In addition, the company’s approach considers the entire product life cycle as an important aspect of development, specifically in relation to the life cycle, compliance with sustainability principles, and the acceptance of the raw materials cultivation system.

A company’s structure and its approach to managing projects and fostering innovation are crucial for successful product development that lasts. This involves important planning sessions to spot and tackle risks, create plans to reduce these risks, organise the steps for putting plans into action, carry out these plans, and constantly work on making things better. Companies should communicate directly with customers, keep researching to understand their specific needs, and focus on innovation to fulfil those needs. By making products that can be recycled and meeting the expectations of customers who care about the environment, a company can drive sustainable product innovation.

This research examines how organisations use design tools and techniques. The company relies on software to create new designs, uses digital and physical tools to achieve innovation, and is committed to creating a culture that encourages creative people to achieve sustainable products. The study also points out that new tools and technologies are being adjusted to promote sustainability, driven by worries about global warming and a wish to reduce carbon dioxide emissions. This dedication is seen as crucial for staying competitive globally, highlighting the use of sustainable raw materials and innovative product development. The mention of recycled materials and innovative alternatives like circularity of product shows the practical actions brands are taking to meet environmental goals.

Institutional Leadership Roles towards Sustainable Product Innovation

To ensure sustainable product innovation, the value creation by existing leaders in the RMG sector is crucial. This process within organisations not only meets current market demands but also contributes positively to environmental and social sustainability. These values are identified through a gap analysis of leadership roles in the industry, as discussed in the results section. The key aspects of leadership roles and their innovative aspects are presented in the following Table 7.

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Table 7.

Innovation of Leadership Approach.

Key aspects	Leadership aspects	Value creation (Innovation)
Organisational culture and structure	Support for innovation and experimentation Collaboration between departments involved in product development	Create significant value by reducing costs and increasing resources, promoting a culture of continuous improvement, motivating employees, adapting to customer needs, sharing knowledge and integrating sustainability into the company’s vision. Create meaningful value by improving team performance, continuous improvement and focusing on new processes. This means building a culture that appreciates creativity, using up-to-date digital tools, smartly handling ideas, and making choices that put the customer first.
Resource allocation	Budget allocation for product development activities Capacity building	Make a big impact by wisely spending money, hiring the right people, and having a strong grasp of local markets. This comprehensive strategy leads to constant innovation, successful product creation, and better market reactions. Create significant value by always striving to improve, making sure employees are on board with company objectives, and using strategic automation.
Market pressure and competition	Competitive pressure to deliver new and innovative products Care consumer demands	Create greater value through collaboration, customer innovation, fostering internal innovation and fostering collaborative practices. Understands and serves customer needs through effective communication, data-driven decision making, alignment with global goals, monitoring and evaluation, and updates on current industry trends.
Industry support and collaboration	Existence of industry associations promoting product development Collaboration between firms and institutions for shared learning	Promote collaboration between multiple interested parties. This can be done through communication, capacity building, conflict reduction, green practices, technology adoption and social skill development. Promote ethical and sustainable practices, tailor training to industry requirements, enhance collaboration with diverse industry stakeholders through technical training, international regulatory and compliance opportunities, and fill skills gaps through industry-specific assignments.

Based on the experiences of Bangladeshi RMG industry, several salient points on leadership roles in transformative change of the industry have been emerged:

Figure 4 illustrates how the findings in institutional awareness, practices, and leadership in forming an organisational culture that is conducive to sustainable product innovation in the RMG industry.

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Figure 4.

Organisational culture for sustainable product innovation in RMG industry.

Implications and Contributions

The study identifies theoretical patterns in sustainability integration, including the influence of institutional pressure, SLCM mediation, market awareness, and leadership moderation. It suggests that coercive pressures directly affect awareness, while normative pressures influence the adoption of practice. The study also suggests that higher institutional leadership can strengthen theoretical relationships, particularly in the translation of awareness to practice. The empirical validation strategy includes within-case analysis, cross-case comparison, expert triangulation, and secondary data corroboration. The implications of this study are as follows:

The study suggests that companies should implement standardized tools like SLCM and TSPD to promote sustainability. A three-phase transformation strategy should be implemented, starting with Foundation Building, which involves allocating 15% to 20% of R&D budget for sustainability initiatives. This includes establishing cross-functional sustainability committees and pursuing LEED certification. The second phase involves system integration, integrating TSPD frameworks and SLCM lifecycle analysis into new product development projects. The third phase focuses on scaling and optimizing, establishing industry partnerships, implementing AI-driven design tools, and creating consumer awareness campaigns. Policymakers should also promote environmentally friendly practices through financial incentives, such as mandatory sustainability reporting for companies with over 1000 employees, green building certification requirements, and extended producer responsibility regulations.