Do Entrepreneurial SMEs Perform Better Because They are More Responsible? (original) (raw)
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The main objective of the current research is to analyze the role of sustainable entrepreneurial orientation toward Indonesian SMEs' business performance. Sustainable entrepreneurial innovation is a construct derived from the entrepreneurial orientation, which is adjusted to the current sustainable development issues that put businesses not only aim for profit but also the sustainability of society and the environment. To achieve the objective, we develop a conceptual framework that includes the sustainable innovation constructs to better understand the process of how sustainable entrepreneurial orientation would determine the overall business performance of a business. 187 Indonesian SME owners and managers were participating to become respondents and provide data needed for the Partial Least Square (PLS) analysis. The key finding from the current research is that sustainable entrepreneurial orientation is a key determinant that could improve all of the constructs of sustainable innovation, which consist of knowledge, product, and market innovation capabilities. In addition, sustainable entrepreneurial innovation also has a significant effect on overall business performance, thus strengthening the role of sustainable entrepreneurial orientation for a business should they would like to improve their overall business performance and innovation capabilities. The theoretical and practical implications for the current research result are discussed within the article.
Sustainable Entrepreneurship in SMEs: A Business Performance Perspective
Assuming that sustainable entrepreneurship leads to business performance, the present paper intends to investigate the standpoints of SMEs (small and medium-sized enterprises) entrepreneurs on different facets. The emphasis is laid on the entrepreneurs' approaches towards people, planet and profit and on their prioritization within business dynamics. The aforementioned dimensions are deemed important factors engendering business performance in terms of turnover, customer attraction and retention and market share. With a view to testing the advanced hypotheses, we employed a quantitative perspective relying on a questionnaire-based survey. As the results posited, the proposed model accounts for almost 50 percent of variance in business performance, whereas sustainable entrepreneurship approaches towards the people and profit dimensions have a significant positive influence on business performance.
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The purpose of the study is to examine the moderating effect of the external environmental characteristics on the relationship between entrepreneurial orientation and SMEs performance. Survey method of research was used by personally administering questionnaires to the owners/managers. Multistage sampling technique was used in selecting 470 SMEs that partook in the survey. SPSS 24 and PLS-SEM 3.0 were employed in the analysis of the data. The results indicated that EO significantly affects SMEs performance. Similarly, there is a significant moderating effect of environmental dynamism on the relationship between EO and SMEs performance. Surprisingly, there is an adverse moderating effect of environmental complexity and hostility on the relationship between EO and SMEs performance. While environmental diversity shows insignificant moderating effect. Therefore, the study put forward that to attain high SMEs performance. There is a need for owners/managers to consider environmental char...
Over last decade, entrepreneurial issues have received much attention due to it significant contribution towards the national economy. In Asia-Pacific Economic Cooperation (APEC) economies, Small Medium-Sized Enterprises (SMEs) share of gross domestic product (GDP) range from 20% to 50%. Meanwhile, SMEs in Malaysia are contributing about 32.7% of Malaysia's GDP (Department of Statistics, Malaysia, 2013). SMEs are regarded as business entities with smaller number of personnel. Therefore, entrepreneurial competencies of the owner/ manager and employees are the critical success factors for its survival and sustainability. Social responsibility is receiving attention in the 21 st century due to its' contribution in business sustainability. This leads to the opportunity to investigate the role of entrepreneurial orientation in SMEs social responsibility specifically the employee's aspect. This paper aims to study the impact of entrepreneurial orientation in the implementation of internal corporate social responsibility (CSR); and examine the moderating effect of the perceived role of ethics and social responsibility in the implementation of internal CSR. The findings provide some insights pertaining to EO in internal decision strategy and the perception of ethics and social responsibility in internal decision making.
Over last decade, entrepreneurial issues have received much attention due to it significant contribution towards the national economy. In Asia-Pacific Economic Cooperation (APEC) economies, Small Medium-Sized Enterprises (SMEs) share of gross domestic product (GDP) range from 20% to 50%. Meanwhile, SMEs in Malaysia are contributing about 32.7% of Malaysia's GDP (Department of Statistics, Malaysia, 2013). SMEs are regarded as business entities with smaller number of personnel. Therefore, entrepreneurial competencies of the owner/ manager and employees are the critical success factors for its survival and sustainability. Social responsibility is receiving attention in the 21 st century due to its' contribution in business sustainability. This leads to the opportunity to investigate the role of entrepreneurial orientation in SMEs social responsibility specifically the employee's aspect. This paper aims to study the impact of entrepreneurial orientation in the implementation of internal corporate social responsibility (CSR);and examine the moderating effect of the perceived role of ethics and social responsibility in the implementation of internal CSR. The findings provide some insights pertaining to EO in internal decision strategy and the perception of ethics and social responsibility in internal decision making.
Factors Promoting Environmental Responsibility in European SMEs: The Effect on Performance
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There is increasing social and political awareness of the importance of developing environmental responsibility at a corporate level. When focusing on issues of responsibility, large companies are frequently perceived to be more responsible for driving climate change and resource depletion. However, small and medium enterprises (SMEs) contribute significantly to the use of resources such as material and energy and produce approximately 64% of the pollution in Europe. Drawing on evidence from "The Eurobarometer 381 Survey on SMEs, Resource Efficiency and Green Markets", we analyze the environmental responsibility of European SMEs, studying their compliance with environmental legislation and how several factors drive environmental orientation among SMEs. Our sample consists of 3647 SMEs operating in 38 countries. Only around a fifth of the firms go beyond environmental regulations, showing the highest levels of environmental responsibility. We conduct OLS regressions to analyze the factors that affect a positive environmental attitude among European SMEs (internal drivers being more significant than external ones) and then, to observe the positive effect of environmental responsibility and firm's experience in offering green services/products on performance, although a conjoint effect was not found. Implications for practitioners, academics, and policy-makers are outlined.
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Small and medium sized enterprises’ (SMEs) activities have contributed significantly to environmental degradation that causes a disastrous effect on us and our future generation. Considering this, sustainable entrepreneurship has been promoted as a resolution of ecological problems capable of addressing climate change issues, public health, and safety concerns, and has become critical for competing in international markets. SMEs activities increased pollution exclusively causing environmental degradation. In response, the world is focusing on ensuring that SMEs produce products through safe and environmentally friendly practices. Literature suggests that organizational support provide SMEs with the impetus to achieve competitive advantage regarding turnover, customer attraction and market share opportunities to achieve business performance. Nonetheless, the implementation of sustainable entrepreneurship among them is still low due to numerous challenges. This paper intends to investigate the influence of organizational support on sustainable entrepreneurship towards performance among SMEs. A case study involving 300 herbal-based SMEs were surveyed using structured questionnaire. Data was analyzed using descriptive statistics, exploratory factor analysis, confirmatory factor analysis, and structural equation model. The results show that organizational support have a positive effect on sustainable entrepreneurship and performance among the SMEs, accounting for 52% and 47% variance respectively. This finding reveals that organizational support is significantly related to entrepreneurship performance, thus substantiates previous findings on the crucial roles of organizational support in enabling organizations to achieve sustainable entrepreneurship performance. This study contributes to triple bottom line literature based on incorporation of strategic choice theory, strategic sustainability orientation and resource-based view theory in entrepreneurship framework.
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Entrepreneurial Orientation (EO) involves business mindset and behavior. The firm and industry context of entrepreneurship has always fascinated researchers for inquiry. The main aim of this study is to establish an association of factors such as EO characteristics (innovativeness and risk-taking), Entrepreneurial Management (EM), and Environmental Dynamism (ED) with firm’s financial performance. The objective also includes examining the moderating impact of EM and ED respectively on the link between EO characteristics and firm performance. This investigation covered small-to-medium enterprises (SMEs) in Pakistan from the cities of Islamabad and Lahore, and constituted a diverse sample of entrepreneurs from various sectors. Results reveal direct positive, individual relationships of innovativeness, risk-taking, and EM with firm’s financial performance. As far as moderating influence is concerned, EM and ED could not establish any significant interaction between EO characteristic...
Environmental Orientation as a Determinant of Innovation Performance in Young Smes
International Journal of Environmental Research, 2014
The popular press, as well as most academic literature, claims that innovation activities are inherently linked to higher company performance. Successful innovations usually increase the firm's market scope or reduce costs, helping firms to obtain superior benefits. Therefore, most innovations are developed with those objectives in mind. Environmental orientation is defined as the managerial recognition of the significance of the impact a company has on the environment, and the need to minimize such impact. Nowadays, environmental motivation for innovation is becoming more and more common as firms are more aware of the consequences of their activities and attempt to be socially responsible. However, most literature on innovation is focused on R&D and on large mature firms, practically neglecting small and medium sized Enterprises-SMEs-, as does the literature on corporate social responsibility. In this paper, we focus on a sample of 1337 start-up SMEs less than 10 years old, from which we obtained information regarding their innovation activities. Our results show that in comparison to cost-oriented innovations, environmental orientation in the development of innovations increases performance.
Sustainable Development of Entrepreneurial Orientation through Social Drivers
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Given that social dilemmas such as climate change, unemployment, and public health are growing globally, recognition of social drivers related to sustainable development while generating social impact is of particular interest to professionals and academics. This study aims to highlight the antecedents of sustainable social impact. Thus, we evaluate the association between entrepreneurial orientation and social impact through the mediation effects of social factors named social drivers, including service innovation, social innovation, and social value orientation. The data collection is from the service and non-service industries in Taiwan. A total of 270 samples consisting of employees, managers, SME owners, and CEOs is used. We employed structural equation modeling (SEM) to test the proposed hypotheses. Research findings indicate entrepreneurial orientation is a determining factor of sustainable innovation that not only renders entrepreneurially strategic dispositions of an organi...