By MarieLouise Abi Hanna, Founder and Executive Director of Creaiviti, and Jaap Bastiaansen, Nexus Climate, both recent alumni of the Chief Strategy Program at INSEAD.
Small and medium-sized enterprises (SMEs) in the Middle East healthcare sector are uniquely positioned to drive sustainable transformation. As the region’s healthcare systems continue to expand and modernise, sustainability must no longer be treated as a peripheral consideration – it must be a core element of business and innovation strategy. Healthcare providers, suppliers, and innovators have a responsibility not only to improve patient outcomes but also to minimise environmental impact and contribute to the broader sustainability agenda.
For SMEs, this shift presents a significant opportunity. By embedding sustainability into innovation initiatives, these businesses can support national environmental goals, improve operational efficiency, and enhance long-term competitiveness in an evolving regional market.
The healthcare industry is under growing pressure to improve health outcomes while simultaneously addressing its environmental footprint. While the sector’s primary mission is to care for patients, it must also acknowledge its role as a major contributor to global carbon emissions, resource consumption, and waste. Fortunately, innovation across products, services, and operational models offers the potential to reduce environmental impact without compromising quality of care.
However, sustainability gains should not be incidental by-products of innovation—they should be the result of deliberate, strategic integration. Healthcare organisations must actively embed environmental responsibility into their innovation frameworks, ensuring that new technologies and services not only improve patient outcomes but also contribute to a healthier planet.
Three Types of Innovation in Healthcare:
Operational Improvements: This type of innovation focuses on enhancing operational processes to reduce waste, lower costs, and improve overall efficiency. It doesn’t require major changes to the company’s business model but can deliver significant sustainability benefits. For example, reducing the energy consumption of manufacturing processes or adopting digital tools to manage medical supplies can streamline operations and minimise the environmental impact of healthcare delivery. Operational improvements might include optimising hospital logistics, better managing supply chains, or moving to renewable energy sources.
Sustaining Innovation: This type of innovation builds on the company’s existing business model by introducing new products or services that support growth while embedding sustainability into their offerings. Healthcare providers can improve their environmental footprint by redesigning treatments or delivery methods that reduce material use, energy consumption, or waste. For example, transitioning to telemedicine services reduces the need for physical visits, cutting down on transportation emissions. Additionally, healthcare companies may explore entering new geographic markets with sustainable healthcare solutions, or introducing products that not only meet health needs but also contribute to environmental targets.
Transformative Innovation: Transformative innovation requires thinking outside the company’s traditional business model and is often the most challenging form of innovation. It usually involves bold, long-term changes that can have a disruptive impact on both the healthcare industry and the environment. For instance, healthcare companies might adopt a circular economy model, where medical products are designed to be reused, recycled, or have a lower environmental impact throughout their lifecycle. Another example is partnering with startups that offer breakthrough solutions, such as digital health platforms or wearable technology, that both enhance patient care and reduce resource use.
Innovation Programs and Sustainability in Healthcare
Healthcare companies—regardless of size—can pursue these types of innovation through in-house efforts or external collaborations. Startups, for instance, bring agility and new perspectives that can accelerate the development of sustainable solutions. Structured innovation programs allow SMEs to build a portfolio of initiatives that balance near-term operational efficiency with long-term environmental impact.
In the Middle East, governments and industry stakeholders are increasingly supporting such efforts through funding, innovation hubs, and sustainability-driven national visions. Programs aligned with initiatives such as Saudi Vision 2030 and the UAE’s Net Zero by 2050 strategy offer a supportive ecosystem for SMEs to scale sustainable innovation and contribute meaningfully to national development goals.
Sustainable Supply Chains: A Critical Lever for Impact
Another key area for improvement lies in the healthcare supply chain. By adopting more sustainable sourcing, reducing packaging waste, and working with logistics partners that prioritise carbon-neutral transportation, healthcare companies can significantly reduce their environmental footprint.
Digital supply chain platforms can further enhance sustainability by improving demand forecasting, reducing inventory waste, and optimising distribution networks. SMEs that adopt such practices not only contribute to environmental goals but also enhance resilience and reduce operational costs. Furthermore, building relationships with suppliers who share sustainability values can create a ripple effect throughout the healthcare ecosystem.
Conclusion: A Sustainable Future for Healthcare SMEs in the Middle East
The intersection of innovation and sustainability presents a powerful opportunity for SMEs in the Middle East healthcare sector. By integrating environmental considerations into every aspect of innovation—from operational practices to product design and strategic transformation—SMEs can position themselves at the forefront of sustainable healthcare delivery.
As the region moves toward more sustainable economies, SMEs that proactively adopt environmentally responsible business models will not only strengthen their competitive advantage but also play a vital role in safeguarding the health of future generations—both human and environmental.
