Factors Influencing Green Innovation Adoption and Its Impact on the Sustainability Performance of Small- and Medium-Sized Enterprises in Saudi Arabia

Abstract

Due to the growing worries of communities and governments about the depletion of natural resources and environmental contamination, green innovation (GI) is currently receiving much attention on a global scale. This study intends to investigate how Green Innovation Adoption (GIA) influences Sustainable Performance (SNP) in Saudi Arabia’s small- and medium-sized enterprises (SMEs) based on primary research. A conceptual framework model is developed to better comprehend the relationships of Government Support (GS), External Partnership and Cooperation (EPC), Rules and Regulatory Factors (RR), Market and Customer Factors (MC), Organization and Human Factors (OH), Green Innovation Strategy (GIS), and Technology Factors (TF) with GIA. The evaluation of hypotheses is performed using the Partial Least-Squares Structural Equation Modeling (PLS-SEM) method. The study’s findings are obtained using the SPSS 24.0 and AMOS 24.0 software programs. The results of this study reveal that GS, EPC, RR, MC, OH, and TF all have a positive impact on GIA. Furthermore, it has been noted that GIA has a positive impact on the economic, social, and environmental performance of SMEs in the Kingdom of Saudi Arabia. In accordance with the findings, corporate units that use GI would produce more acceptable eco-friendly and long-term performance.