Business Performance and Sustainability Outcomes Driven by Circular Economy, Eco-Innovation, and Sustainable Marketing

Sustainable practices are increasingly recognized as critical drivers of business performance in contemporary markets. This study examines the influence of Circular Economy (CE), Eco-Innovation (EI), and Sustainable Marketing (SM) on Business Performance (BP) among micro, small, and medium-sized enterprises (MSMEs) located in Aguascalientes, Mexico, a representative emerging-economy context within Latin America. The relationships among these constructs were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) in SmartPLS 4.0. Results show that CE significantly drives both EI and SM, and that EI positively influences BP. However, the direct effect of SM on BP was marginal, indicating that its contribution to business performance is weaker than that of circular and eco-innovative practices in the analyzed sample. Among CE dimensions, enablers were the strongest driver of circular adoption, while in EI, adoption incentives exerted the greatest influence. This research contributes to the sustainability and management literature by rigorously analyzing and comparing the relative impact of different sustainability-oriented strategies—circular, innovative, and marketing-based—on business performance. By examining how these strategies interact and differ in their effects, the study offers evidence-based guidance for MSMEs with limited resources to prioritize initiatives with greater potential to enhance competitiveness. The proposed integrated CE–EI–SM–BP framework, validated through a predictive PLS-SEM approach (PLSpredict), provides robust empirical evidence from an underexplored emerging-economy context. The results also open avenues for future research to examine contextual or temporal factors influencing the effectiveness of sustainability-based strategies.