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Firms are increasingly driven by social purpose. Although skeptics doubt that for-profit firms are truly committed to socially purposeful goals, firms pursuing both economic and non-economic goals are increasingly prevalent in the organizational landscape (Cao et al., 2017;Dahlin et al., 2020;Gehman et al., 2019). Related to the social purposefulness of organizations, a major signaling mechanism that has emerged in recent years is the B Lab certification-or, certification for for-profit firms with social and environmental missions Grimes et al., 2018). Although there are a variety of sister organizational forms such as social enterprises, B Corps are increasingly meeting the global standard of goals and objectives of public benefit corporations (

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Purpose: This study examines the effect of absorptive capacity (ACAP) and co-creation on innovation performance (INN). Design/methodology/approach: We use survey data from Swedish and Norwegian companies (N = 1102) and establish a cross-national equivalence between Sweden and Norway. Findings: The subsequent structural model revealed interesting differences. For Sweden, co-creation fully mediates the effect of ACAP on INN, whereas for Norway, ACAP has a direct effect on INN with no mediation. Subsequent regressions including control variablesshowed that the structural model is reasonably robust. We conclude that, despite the many common national features conducive to innovation between these two countries, sufficient differences remain to create substantial variation in the innovation processes. Originality:The study presents a second-order model of ACAP that permits a unique test of cross country differences.

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