Sustainability 2022, 14, 14771. https://doi.org/10.3390/su142214771 www.mdpi.com/journal/sustainability Systematic Review A Systematic Review on Sustainability‐Oriented Innovation in the Social Enterprises Budi Harsanto 1, *, Asep Mulyana 2 , Yudi Ahmad Faisal 3 , Venny Mellandhia Shandy 4 and Muntasir Alam 5 1 Faculty of Economics and Business, Universitas Padjadjaran, Bandung 40132, Indonesia 2 Magister in Integrated Microfinance Management Program, Universitas Padjadjaran, Bandung 40132, Indonesia 3 Center for Management and Business Studies, Universitas Padjadjaran, Bandung 40115, Indonesia 4 Magister in Management Science Program, Universitas Padjadjaran, Bandung 40115, Indonesia 5 Lancaster University Management School, Lancaster University, Lancaster LA1 4YX, UK * Correspondence: budi.harsanto@unpad.ac.id Abstract: Sustainability‐oriented innovation (SOI) is a subset of innovation that focuses on not just maximizing profits but also on minimizing negative consequences for the environment and society. Despite the fact that the study of SOI has grown rapidly in recent years, little is known about how SOI takes place in social enterprises (SEs). The aim of this study is to understand SOI in SEs with two research questions focusing on the current state of the research and the identification of emer‐ gent themes and subthemes regarding SOI practices in SEs. The method used was a systematic re‐ view of the scholarly literature guided by the PRISMA protocol. The systematic search and filtering process resulted in 27 studies, which were filtered out of a total of 100 studies. The study’s findings show that process/organizational innovation, such as business model transformation and stake‐ holder management to increase SEs’ societal impact, is widely practiced in SEs. Unlike SOI in com‐ mercial organizations, which is dominant in the subcategory of SOI of environmental innovation, SOI in SEs is more prevalent in social innovation. Several challenges faced by SEs in developing SOIs were also revealed, including a lack of long‐term funding, low entry barriers for potential competitors, and inefficiencies. A number of potential future directions were also discussed. Keywords: sustainability‐oriented innovation; sustainability innovation; social enterprises; systematic review; PRISMA 1. Introduction Global issues, such as environmental degradation, economic disparities, and the re‐ cent COVID‐19 pandemic, have prompted business actors to reconsider how they should operate and innovate [1,2]. Recognized as the primary driver of economic growth, corpo‐ rate innovation that does not take into account environmental factors is thought to be financially beneficial but harmful and detrimental to the environment and society [3]. From there, the concept of sustainability‐oriented innovation (SOI) or sustainability inno‐ vation (SI) emerged as the most appropriate driver of corporate innovation in the twenty‐ first century [4–6]. Although SOI research has grown significantly in the past decade, little is known about SOI in relation to social enterprises (SEs) [7]. SOI research has expanded rapidly in the last decade, but little is known about SOI in the context of social enterprises (SEs). Understanding SOI in SEs is crucial since SEs have unique characteristics that distin‐ guish them from other types of enterprises. The distinction is that while SEs are often profit‐seeking enterprises, their profits are utilized to fund previously planned socially planned programs. SEs are a phenomenon that has piqued the interest of various policy‐ makers, practitioners, and academics around the world due to their hybrid nature, namely Citation: Harsanto, B.; Mulyana, A.; Faisal, Y.A.; Shandy, V.M.; Alam, M. A Systematic Review on Sustainability‐Oriented Innovation in the Social Enterprises. Sustainability 2022, 14, 14771. https://doi.org/10.3390/ su142214771 Academic Editors: Hiroki Nakamura, Masaharu Okada, Ashir Ahmed, Nuren Abedin and Hiroshi Hoshino Received: 21 August 2022 Accepted: 31 October 2022 Published: 9 November 2022 Publisher’s Note: MDPI stays neu‐ tral with regard to jurisdictional claims in published maps and institu‐ tional affiliations. Copyright: © 2022 by the authors. Li‐ censee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and con‐ ditions of the Creative Commons At‐ tribution (CC BY) license (https://cre‐ ativecommons.org/licenses/by/4.0/).