Eco-innovation in Hungarian wineries:
What drives sustainability in an emerging wine market?
By Imre Fertő and Valéria Lekics
Wine is not just a cultural product in Hungary; it is also an economically important sector that faces a growing environmental challenge. Viticulture and winemaking are resource-intensive, involving significant water use, energy consumption, and agrochemical applications. As climate change accelerates and consumers increasingly demand sustainable products, wineries are under pressure to adapt.
Our recent study, based on a survey of 234 Hungarian wineries, examines the firm-level and contextual factors that drive eco-innovation adoption. We focus on the role of dynamic capabilities, absorptive capacity, networking, and managerial commitment – organisational attributes that determine whether a winery can implement environmentally friendly practices such as energy and water savings, reduced pesticide use, renewable energy adoption, and greenhouse gas (GHG) mitigation.
Absorptive capacity is the strongest driver
The clearest finding is that absorptive capacity – the ability to recognise, assimilate, and apply external knowledge – is the single most important predictor of eco-innovation adoption. Wineries that actively seek and integrate knowledge from universities, research centres, suppliers, or industry associations are more likely to implement water-efficient irrigation, organic farming, or renewable energy systems.
In practical terms, this means that knowledge-rich networks and continuous learning are not peripheral but central to sustainability transitions. In Tokaj, for example, medium-sized wineries have partnered with environmental NGOs to improve waste management, demonstrating how knowledge inflows can translate into concrete environmental outcomes.
Dynamic capabilities matter – but with constraints
Dynamic capabilities – the ability to reconfigure resources and adapt rapidly – also have a positive effect, particularly for more complex innovations such as digital vineyard management and GHG reduction technologies. However, their impact is weaker than that of absorptive capacity.
In Hungary’s emerging wine market, three main constraints limit the realisation of dynamic capabilities: financial barriers, uneven technological readiness, and underdeveloped institutional support. By contrast, wineries in Spain or Australia often benefit from larger scales, stronger R&D ecosystems, and targeted public policies, allowing them to fully leverage these capabilities.
Leadership is critical
Managerial commitment is another strong driver, especially in family-owned or cooperative wineries, where long-term stewardship and legacy concerns are embedded in strategic decisions. In Villány, some family wineries have shifted their entire energy supply to renewables and used eco-certifications as part of their branding. Such cases show that leadership values shape both internal processes and external market positioning.
Networking: a double-edged sword
Networking capabilities have a mixed influence. Strong networks help diffuse incremental innovations, such as organic waste recycling or integrated cultivation. But they can hinder more disruptive innovations if networks are fragmented, misaligned, or focused on maintaining existing practices.
In the Balaton Uplands, joint investment in sustainable packaging among neighbouring wineries shows the benefits of cooperation. Yet advanced technologies like soil sensors tend to spread only where formal partnerships with research institutions exist.
Knowledge management amplifies innovation
Structured knowledge management – from supplier collaboration to participation in conferences – significantly increases eco-innovation adoption. While Hungarian wineries are active in exchanging knowledge with suppliers and competitors, links to universities and research institutes remain underdeveloped, suggesting an untapped potential for science-based innovation.
Ownership and succession effects
Family ownership and intra-family succession strengthen the positive link between managerial commitment and eco-innovation. The next generation of winery leaders often has stronger environmental values and greater openness to new technologies. Interestingly, female-led wineries in our sample were more likely to implement eco-innovations in cellar operations and packaging, and tended to adopt more collaborative sustainability strategies.
Policy and industry implications
Our findings highlight that improving sustainability in Hungarian wineries requires more than just access to capital or technology. Building absorptive capacity through education, training, and stronger links to knowledge hubs is essential. Targeted financial incentives can help overcome the cost barriers to advanced eco-innovations. Policymakers should also work to simplify sustainability regulations and create advisory services to guide wineries through eco-certification or subsidy applications.
Finally, collaborative models – such as shared renewable energy or waste treatment infrastructure – could help smaller wineries overcome scale disadvantages. Supporting women and next-generation leaders in sustainability roles may further accelerate the sector’s green transition.
Conclusion
The Hungarian wine industry’s sustainability transition is not just possible; it is already underway. But progress depends on how effectively wineries can absorb external knowledge, leverage leadership commitment, and navigate the complex interplay between networks and innovation. With targeted support, Hungary’s wineries could not only maintain their cultural and economic significance but also emerge as a model for sustainable wine production in emerging markets.
Imre Fertő, Valéria Lekics:
Eco-innovation drivers in the wine industry: insights from Hungarian wineries.
British Food Journal 2025
