Family businesses dominate global economies, yet remain underexplored in Global South contexts, particularly regarding their unique approaches to sustainable innovation. This study investigates how family businesses in developing economies manage intergenerational knowledge transfer to enable sustainable business model innovation (SBMI). Using a qualitative multiple-case study of 15 Moroccan family businesses across diverse sectors, we employed the Gioia methodology to analyze 29 interviews with founders, successors, and key managers. Grounded in the Knowledge-Based View, our findings reveal that family businesses leverage sophisticated formal and informal knowledge transfer mechanisms—including storytelling, mentoring, technical training, and cultural embedding—to drive triple bottom line innovations across People, Planet, and Profit dimensions. Unlike Western corporate models, these firms achieve sustainability through culturally embedded practices rooted in territorial embeddedness, trust-based relationships, and religious-cultural values rather than formal strategies. The research contributes a novel conceptual model demonstrating how bidirectional knowledge flows between generations enable authentic sustainability while preserving cultural identity. Practical implications include guidance for family business leaders, policymakers designing support programs, and sustainability practitioners, recognizing diverse innovation pathways beyond Western-centric frameworks. This work challenges dominant sustainability paradigms by revealing how developing economy enterprises navigate institutional voids through social capital mobilization and knowledge synthesis.