The impact of green organizational and human resource factors on developing countries' small business firms tendency toward green innovation: A natural resource‐based view approach

Abstract

Developing countries' small business firms are deemed insensitive towards the environment. However, little is known regarding what can reshape their attitude towards environmental management and uplift their abilities to counter environmental issues. Based on the extant literature review, we suggest that small business firms necessitate direction, motivation, structural capabilities, and ingenuity to tackle environmental issues through green innovation. We postulate that green organizational and human resource factors such as green business strategy (direction), green competencies (structural capabilities), green organizational culture (impetus), and green absorptive capacity (ingenuity) can reshape small businesses firms' tendency towards environmental preservation and green innovation. We tested our hypotheses on the data collected from small manufacturing firms located in different regions of Pakistan. Our findings suggest that developing countries' small business firms lag in environmental preservation due to their inability to comprehend and handle environmental problems. Introducing relevant green organizational and human resource factors can significantly improve small business firms' attitudes towards environmental management and green innovation. Moreover, our findings also reveal that small business firms lean towards green process innovation rather than green product innovation, depicting small business firms' behavioural tendencies towards innovation.