The Role of Green Organizational Culture Based on Tri Hita Karana in Increasing Green Innovation and Sustainable Competitive Advantage Small and Medium Enterprises in Denpasar City

Abstract

Small and Medium Enterprises (SMEs) in Denpasar City, in addition to having a positive impact on stakeholders and contributing to the national economy, are also often perceived by some people as parties responsible for various environmental damage phenomena including environmental pollution, air pollution and global warming. This study aims to develop and test a theoretical model that empirically examines how green organizational culture based on local wisdom in the Tri Hita Karana perspective influences sustainable competitive advantage in the context of SMEs. In addition, this study also statistically explores the research model and the mediating role of green innovation that has previously received little attention. This study uses a quantitative approach using a survey of 95 respondents. Data were collected from a convenient field survey using a closed questionnaire from SME actors related to the direct responsibility of business activities towards environmental aspects in the city of Denpasar Bali-Indonesia. A structural equation modeling approach was used to achieve the research objectives. The results showed that green organizational culture based on Tri Hita Karana is a significant predictor of sustainable competitive advantage in this study. Furthermore, the findings reveal that green innovation fully mediates the relationship between green organizational culture based on Tri Hita Karana and sustainable competitive advantage.