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Does Environmental Sustainability Impact Innovation, Ecological and Social Measures of Firm Performance of SMEs? Evidence from South Africa

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  • Reginald Masocha

    (School of Economics and Management, University of Limpopo, Sovenga 0727, South Africa)

Abstract

This study investigated the question of whether environmental sustainability influences firm performance. Firm performance, a multidimensional construct, was researched utilizing innovation, ecological and social measures on the premises of SMEs in South Africa. Thus, the study hypothesized that environmental sustainability is positively and significantly related to innovation, ecological and social measures of firm performance. A cross-sectional research design was adopted in this study to test the abovementioned hypotheses. A total of 208 self-administered questionnaires distributed to SME owners and managers were analyzed utilizing structural equation modelling (SEM) and Amos Version 24 software. Primarily, the study established that environmental sustainability was significantly and positively correlated to all three measures of firm performance used in this study. Thus, the inferences from the findings suggest that environmental sustainability practices contribute positively towards firm innovation, ecological and social performances. The findings of this study greatly contribute towards the practice and theory of small businesses and firm performance by providing a more specific and streamlined perspective for approaching firm performance.

Suggested Citation

  • Reginald Masocha, 2018. "Does Environmental Sustainability Impact Innovation, Ecological and Social Measures of Firm Performance of SMEs? Evidence from South Africa," Sustainability, MDPI, vol. 10(11), pages 1-11, October.
    • Handle: RePEc:gam:jsusta:v:10:y:2018:i:11:p:3855-:d:177918
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    4. Chao Hung Wang, 2020. "An environmental perspective extends market orientation: Green innovation sustainability," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3123-3134, December.
    5. Yousif Munadhil Ibrahim & Norsiah Hami & Siti Norezam Othman, 2019. "Integrating Sustainable Maintenance into Sustainable Manufacturing Practices and its Relationship with Sustainability Performance: A Conceptual Framework," International Journal of Energy Economics and Policy, Econjournals, vol. 9(4), pages 30-39.
    6. Iqra Sadaf Khan & Osmo Kauppila & Noureen Fatima & Jukka Majava, 2022. "Stakeholder interdependencies in a collaborative innovation project," Journal of Innovation and Entrepreneurship, Springer, vol. 11(1), pages 1-17, December.
    7. Muhammad Khuram Khalil & Umaporn Muneenam, 2021. "Total Quality Management Practices and Corporate Green Performance: Does Organizational Culture Matter?," Sustainability, MDPI, vol. 13(19), pages 1-27, October.
    8. Waymond Rodgers & Mouza Al Habsi & George Gamble, 2019. "Sustainability and Firm Performance: A Review and Analysis Using Algorithmic Pathways in the Throughput Model," Sustainability, MDPI, vol. 11(14), pages 1-27, July.
    9. Farman Ullah Khan & Daniel Badulescu, 2025. "Sustainability Pressures Unveiled: Navigating the Role of Organizational Sustainable Culture in Promoting Sustainability Performance," Sustainability, MDPI, vol. 17(3), pages 1-18, February.
    10. Joseph Bakos & Michele Siu & Adalberto Orengo & Narges Kasiri, 2020. "An analysis of environmental sustainability in small & medium‐sized enterprises: Patterns and trends," Business Strategy and the Environment, Wiley Blackwell, vol. 29(3), pages 1285-1296, March.
    11. Naradda Gamage, Sisira Kumara & Ekanayake, EMS & Abeyrathne, GAKNJ & Prasanna, RPIR & Jayasundara, JMSB & Rajapakshe, PSK, 2019. "Global Challenges and Survival Strategies of the SMEs in the Era of Economic Globalization: A Systematic Review," MPRA Paper 98419, University Library of Munich, Germany.
    12. Jayasundara, JMSB & Rajapakshe, PSK & Prasanna, RPIR & Naradda Gamage, Sisira Kumara & Ekanayake, EMS & Abeyrathne, GAKNJ, 2019. "The Nature of Sustainability Challenge in Small and Medium Enterprises and its Management," MPRA Paper 98418, University Library of Munich, Germany.
    13. Chin-Hung Tseng & Kuo-Hsiung Chang & Ho-Wen Chen, 2019. "Strategic Orientation, Environmental Innovation Capability, and Environmental Sustainability Performance: The Case of Taiwanese Suppliers," Sustainability, MDPI, vol. 11(4), pages 1-19, February.
    14. Malesios, Chrisovalantis & De, Debashree & Moursellas, Andreas & Dey, Prasanta & Evangelinos, Konstantinos, 2019. "Review of Statistical Modeling Approaches for Sustainability Analysis of Small and Medium sized Enterprises," MPRA Paper 93028, University Library of Munich, Germany.
    15. Naween Weerasinghe & Ashani Weerasinghe & Yulashika Perera & Sanduni Tennakoon & Nilmini Rathnayake & Punmadara Jayasinghe, 2023. "Sustainability practices and organizational performance during the COVID-19 pandemic and economic crisis: A case of apparel and textile industry in Sri Lanka," PLOS ONE, Public Library of Science, vol. 18(7), pages 1-31, July.
    16. Malesios, Chrisovalantis & De, Debashree & Moursellas, Andreas & Dey, Prasanta Kumar & Evangelinos, Konstantinos, 2021. "Sustainability performance analysis of small and medium sized enterprises: Criteria, methods and framework," Socio-Economic Planning Sciences, Elsevier, vol. 75(C).
    17. Chai Bin Feng & Muhammad Usman Khurram & Raheel Safdar & Sultan Sikandar Mirza & Amjad Iqbal, 2023. "Corporate strategic responses, supplier concentration and sustainable growth of chinese listed firms," Operations Management Research, Springer, vol. 16(3), pages 1413-1427, September.
    18. Yanrong Hu & Qingyang Liu & Hongjiu Liu, 2025. "Spatiotemporal Analysis of Coupling-Coordination Between Developments of Economic High-Quality and Ecological Innovation of China’s Inter-Provinces," Computational Economics, Springer;Society for Computational Economics, vol. 66(3), pages 2383-2412, September.
    19. Philbin, Simon & Viswanathan, Radhakrishnan & Telukdarie, Arnesh, 2022. "Understanding how digital transformation can enable SMEs to achieve sustainable development: A systematic literature review," Small Business International Review, Asociación Española de Contabilidad y Administración de Empresas - AECA, vol. 6(1), pages 473-473, May.

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