Both, knowledge management and sustainable development has been coined for slightly more than a decade now, as the essential solution to the global crisis. Today's economic development practices are causing detrimental effect to the environment. Sustainable development is essential to sustain the ecosystem and the natural resources from depletion while creating new products/services for business sustainability. The basis of fostering sustainable development in business requires involvement of all different parties and major change practices and beliefs. The foundation of knowledge management, however, is to transform information and intellectual capital to achieve organization's goal. Knowledge management acts as the catalyst for organization change. It entails processes associated with sharing, exchanging, creation and disseminating of knowledge. The study presents the correlation of knowledge management and sustainable development for developing business competitive advantage. This paper sample cases from industries mapping out the essence of these two stipulations in their solution to prevailing challenges in the economy. Finally, a framework is developed based on the underlying principles of McKinsey 7S framework justifying the best practices of knowledge management provides a very good foundation to sustainable development. © 2010 IEEE.