The influence of economic, social and environmental dimensions on small and medium-sized enterprises (SMEs) sustainability in Selangor.
Abstract
This study identifies the factors that shape the sustainability of Small and Medium-sized Enterprises (SMEs), with a particular focus on SMEs in Selangor. SMEs’ sustainability refers to the ability of Small and Medium-sized Enterprises (SMEs) to maintain and enhance their economic, social, and environmental performance over the long term. It involves using resources responsibly and efficiently, developing resilient business practices, and committing to addressing social and environmental challenges. Sustainable SMEs strive for economic viability while considering societal well-being and minimizing environmental impacts. This includes efforts to foster innovation, ethical business conduct, community engagement, and environmental stewardship, contributing to long-term business success and positive societal outcomes. By gathering and analyzing data from a sample of 100 SMEs operating in the Selangor region, this research examines the factors influencing SME sustainability. It uses a quantitative approach by distributing a questionnaire via a Google Form developed by the researcher. The statistical significance of the data was assessed using the Statistical Package for the Social Sciences (SPSS) Software version 29. The findings indicate that all the variables had a substantial impact on the firm’s performance. Consequently, to enhance understanding of financial transparency within the company, it is imperative to pay particular attention to improving the organizational structure to improve overall firm performance.
Full text article
References
Ali, H., Chen, T., & Hao, Y. (2021). Sustainable manufacturing practices, competitive capabilities, and sustainable performance: moderating role of environmental regulations. Sustainability, 13(18), 10051. https://doi.org/10.3390/su131810051
Ali, H., Chen, T., & Hao, Y. (2021). Sustainable manufacturing practices, competitive capabilities, and sustainable performance: moderating role of environmental regulations. Sustainability, 13(18), 10051. https://doi.org/10.3390/su131810051 DOI: https://doi.org/10.3390/su131810051
Ali, Y., Younus, A., Khan, A., & Pervez, H. (2020). Impact of lean, six sigma and environmental sustainability on the performance of smes. International Journal of Productivity and Performance Management, 70(8), 2294-2318. https://doi.org/10.1108/ijppm-11-2019-0528 DOI: https://doi.org/10.1108/IJPPM-11-2019-0528
Bag, S., Dhamija, P., Bryde, D., & Singh, R. (2022). Effect of eco-innovation on green supply chain management, circular economy capability, and performance of small and medium enterprises. Journal of Business Research, 141, 60-72. https://doi.org/10.1016/j.jbusres.2021.12.011 DOI: https://doi.org/10.1016/j.jbusres.2021.12.011
Boiral, O., Baron, C., & Gunnlaugson, O. (2013). Environmental leadership and consciousness development: a case study among canadian smes. Journal of Business Ethics, 123(3), 363-383. https://doi.org/10.1007/s10551-013-1845-5 DOI: https://doi.org/10.1007/s10551-013-1845-5
Castellani, P., Rossato, C., Giaretta, E., & Sánchez, A. (2023). Partner selection strategies of smes for reaching the sustainable development goals. Review of Managerial Science, 18(5), 1317-1352. https://doi.org/10.1007/s11846-023-00656-7 DOI: https://doi.org/10.1007/s11846-023-00656-7
Clemente‐Almendros, J., García, M., & Blanco-Hernández, M. (2025). Smes and sustainable practices: identifying key factors from spanish evidence. Sage Open, 15(1). https://doi.org/10.1177/21582440251329631 DOI: https://doi.org/10.1177/21582440251329631
Durrani, N., Raziq, A., Mahmood, T., & Khan, M. (2024). Barriers to adaptation of environmental sustainability in smes: a qualitative study. Plos One, 19(5), e0298580. https://doi.org/10.1371/journal.pone.0298580 DOI: https://doi.org/10.1371/journal.pone.0298580
Guijarro, A. and Gómez-Guillamón, A. (2023). Sustainable development barriers and pressures in smes: the mediating effect of management commitment to environmental practices. Business Strategy and the Environment, 33(2), 949-967. https://doi.org/10.1002/bse.3537 DOI: https://doi.org/10.1002/bse.3537
Hanan, A., Shahira, A., & Ali, M. (2021). Drivers of sustainable entrepreneurship among smes in pakistan: does entrepreneurial knowledge matter?. Indonesian Journal of Innovation and Applied Sciences (Ijias), 1(2), 161-176. https://doi.org/10.47540/ijias.v1i2.257 DOI: https://doi.org/10.47540/ijias.v1i2.257
Hermawan, A., Masudin, I., Zulfikarijah, F., Restuputri, D., & Shariff, S. (2023). The effect of sustainable manufacturing on environmental performance through government regulation and eco-innovation. International Journal of Industrial Engineering and Operations Management, 6(4), 299-325. https://doi.org/10.1108/ijieom-04-2023-0039 DOI: https://doi.org/10.1108/IJIEOM-04-2023-0039
Johnson, M. and Schaltegger, S. (2015). Two decades of sustainability management tools for smes: how far have we come?. Journal of Small Business Management, 54(2), 481-505. https://doi.org/10.1111/jsbm.12154 DOI: https://doi.org/10.1111/jsbm.12154
Junejo, I., Saraih, U., Esponda-Pérez, J., Ejaz, S., Ejaz, F., & Hossain, M. (2024). Factors affecting on environmental strategy in smes manufacturing firms of a developing country: mediating role of green employee behavior. F1000research, 13, 654. https://doi.org/10.12688/f1000research.152351.1 DOI: https://doi.org/10.12688/f1000research.152351.1
López-Pérez, M., Melero‐Polo, I., Vázquez‐Carrasco, R., & Cambra‐Fierro, J. (2018). Sustainability and business outcomes in the context of smes: comparing family firms vs. non-family firms. Sustainability, 10(11), 4080. https://doi.org/10.3390/su10114080 DOI: https://doi.org/10.3390/su10114080
Malesios, C., Skouloudis, A., Dey, P., Abdelaziz, F., Kantartzis, A., & Evangelinos, K. (2018). Impact of small‐ and medium‐sized enterprises sustainability practices and performance on economic growth from a managerial perspective: modeling considerations and empirical analysis results. Business Strategy and the Environment, 27(7), 960-972. https://doi.org/10.1002/bse.2045 DOI: https://doi.org/10.1002/bse.2045
Masocha, R. (2019). Social sustainability practices on small businesses in developing economies: a case of south africa. Sustainability, 11(12), 3257. https://doi.org/10.3390/su11123257 DOI: https://doi.org/10.3390/su11123257
Mengistu, A. and Panizzolo, R. (2023). Metrics for measuring industrial sustainability performance in small and medium-sized enterprises. International Journal of Productivity and Performance Management, 73(11), 46-68. https://doi.org/10.1108/ijppm-04-2022-0200 DOI: https://doi.org/10.1108/IJPPM-04-2022-0200
Min, H., Tambunan, T., & Santosa, B. (2023). The drivers of sustainability practices in smes and the impact on business performance. Journal of Economics Management and Trade, 29(12), 1-16. https://doi.org/10.9734/jemt/2023/v29i121172 DOI: https://doi.org/10.9734/jemt/2023/v29i121172
Moursellas, A., De, D., Wurzer, T., Skouloudis, A., Reiner, G., Chaudhuri, A., … & Dey, P. (2022). Sustainability practices and performance in european small-and-medium enterprises: insights from multiple case studies. Circular Economy and Sustainability, 3(2), 835-860. https://doi.org/10.1007/s43615-022-00224-3. DOI: https://doi.org/10.1007/s43615-022-00224-3
Oyewole, A., Adeoye, O., Addy, W., Okoye, C., & Ofodile, O. (2024). Enhancing global competitiveness of u.s. smes through sustainable finance: a review and future directions. International Journal of Management & Entrepreneurship Research, 6(3), 634-647. https://doi.org/10.51594/ijmer.v6i3.876 DOI: https://doi.org/10.51594/ijmer.v6i3.876
Sawang, S., Ng, P., Kivits, R., Dsilva, J., & Locke, J. (2024). Examining the influence of customers, suppliers, and regulators on environmental practices of smes: evidence from the united arab emirates. Business Strategy and the Environment, 33(7), 6533-6546. https://doi.org/10.1002/bse.3831 DOI: https://doi.org/10.1002/bse.3831
Suchek, N., Ferreira, J., & Fernandes, P. (2022). A review of entrepreneurship and circular economy research: state of the art and future directions. Business Strategy and the Environment, 31(5), 2256-2283. https://doi.org/10.1002/bse.3020 DOI: https://doi.org/10.1002/bse.3020
Tsvetkova, D., Bengtsson, E., & Durst, S. (2020). Maintaining sustainable practices in smes: insights from sweden. Sustainability, 12(24), 10242. https://doi.org/10.3390/su122410242 DOI: https://doi.org/10.3390/su122410242
Wassan, R., Shaikh, S., Marri, H., Memon, M., & Shah, S. (2023). Analyzing the impact of glss implementation over sustainability in pakistani smes. Benchmarking an International Journal, 31(8), 2547-2564. https://doi.org/10.1108/bij-05-2022-0338 DOI: https://doi.org/10.1108/BIJ-05-2022-0338
Yacob, P., Peter, D., & Chin, K. (2021). Sustainable business practices in manufacturing smes: the mediating effect of dynamic capabilities. International Social Science Journal, 72(243), 73-89. https://doi.org/10.1111/issj.12303 DOI: https://doi.org/10.1111/issj.12303
Authors
Copyright (c) 2025 NOR HAFIZA ABD SAMAD, ANIS JUANITA MOHD ZAINUDDIN
This work is licensed under a Creative Commons Attribution 4.0 International License.