Green Entrepreneurial Orientation and Green Innovation in Small and Medium-Sized Enterprises (SMEs)

Chaiyawit Muangmee,Nusanee Meekaewkunchorn,Zdzisława Dacko-Pikiewicz,Bilal Khalid,Nuttapon Kassakorn

doi:10.3390/socsci10040136

Abstract

Since environmental issues are becoming an integral part of business performances, policymakers and managers have started recognizing the importance of green innovation towards sustainable business performances. The role of the automotive parts industry is crucial in minimizing environmental degradation and promoting sustainable development. Yet few studies have focused on the connection between green entrepreneurial orientation and green innovation that may affect small and medium enterprise (SME) business performance. Therefore, this study aims to analyze the influence of green entrepreneurial orientation on green innovations, and its effects on sustainable business performances in the automotive parts industry in Thailand. The sample consists of 226 SMEs in the automotive parts industry in Thailand. The partial least square method (PLS-SEM) has been used for the analysis of data. The results of the study show that green innovations have the strongest influence on economic and environmental performances. This study contributes to resource-based view theory by incorporating green innovation as a strategic competency of SMEs’ performance. Further, green entrepreneurial orientation and green innovation can assist SME managers in understanding the factors leading to sustainable performance of businesses.

Highlights

Increasing environmental issues are posing serious threats to humans, their economic growth, and ecology (Leonidou et al 2017)
Inspired by the concept of the triple bottom line, this study has constructed a conceptual model based on resource-based view (RBV) theory and assessed the impact of green entrepreneurial orientation (GEO) on green innovation (GI) which led to social performance (SP), economic performance (EP), and environmental performance of the firms
The findings of the study contribute to resource-based view theory and suggest valuable insights to entrepreneurs regarding the implementation of green strategies

Summary

Introduction

Increasing environmental issues are posing serious threats to humans, their economic growth, and ecology (Leonidou et al 2017). Studies suggest that green entrepreneurial orientation (GEO). Has a crucial role in realizing the environmental, economic, and social performance of organizations (Asadi et al 2020; Jiang et al 2018; Schaefer et al 2015). The views of scholars are split regarding the composition of green entrepreneurial orientation. Lumpkin and Dess (1996) clearly state that entrepreneurial orientation is the combination of enterprise initiative and competitive aggressiveness that enables new behavior. Inferring from Arruda (1999), green entrepreneurial orientation is the combination of initiative and environmental orientation. Past studies indicate that social orientation and environmental orientation are two essential components of green entrepreneurial orientation (Cohen and Winn 2007). The work of past scholars shows that green entrepreneurial orientation is embedded in a firm’s proactive stance that enhances its

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