Colorectal cancer (CRC) remains the third most prevalent malignancy globally, with approximately 154,000 new cases and 54,000 projected deaths anticipated for 2025. The recent advancement of foundation models in computational pathology has been largely propelled by task agnostic methodologies that can overlook organ-specific crucial morphological patterns that represent distinct biological processes that can fundamentally influence tumor behavior, therapeutic response, and patient outcomes. The aim of this study is to develop a novel, interpretable AI model, PRISM (Prognostic Representation of Integrated Spatial Morphology), that incorporates a continuous variability spectrum within each distinct morphology to characterize phenotypic diversity and reflecting the principle that malignant transformation occurs through incremental evolutionary processes rather than abrupt phenotypic shifts. PRISM is trained on 8.74 million histological images extracted from surgical resection specimens of 424 patients with stage III CRC. PRISM achieved superior prognostic performance for five-year OS (AUC = 0.70 +- 0.04; accuracy = 68.37% +- 4.75%; HR = 3.34, 95% CI = 2.28-4.90; p < 0.0001), outperforming existing CRC-specific methods by 15% and AI foundation models by ~23% accuracy. It showed sex-agnostic robustness (AUC delta = 0.02; accuracy delta = 0.15%) and stable performance across clinicopathological subgroups, with minimal accuracy fluctuation (delta = 1.44%) between 5FU/LV and CPT-11/5FU/LV regimens, replicating the Alliance cohort finding of no survival difference between treatments.