Green Innovation in MSMEs: Adaptive Strategies for Competitiveness and Sustainable Economic Growth
DOI:
https://doi.org/10.38035/dijefa.v7i1.6330Keywords:
Green Innovation, Adaptive Strategies, Competitiveness, Sustainable Economic GrowthAbstract
This study examines green innovation and adaptive strategies as strategic determinants of MSME competitiveness and sustainability in the context of sustainable economic development. It analyzes how green innovation contributes to sustainable economic growth and identifies key drivers and barriers to its implementation, while also assessing the role of adaptive strategies in responding to globalization, shifting consumer preferences, and rising environmental demands. Using a quantitative survey of 150 MSMEs in Indonesia and data analysis with PLS-SEM, the study tests the relationships among green innovation, adaptive strategies, competitiveness, and sustainable economic growth. The results show that green innovation significantly promotes sustainable economic growth, and adaptive strategies are crucial in enhancing MSME competitiveness as well as mediating the relationship between green innovation and economic growth. Nonetheless, limited resources, constrained technological access, and weak regulatory support remain major obstacles. Theoretically, the study advances the literature on the integration of green innovation and adaptive strategies in MSMEs in developing countries. Practically, it offers implications for policy and managerial strategies to strengthen MSME competitiveness and sustainability through multi-stakeholder collaboration and policy incentives.
References
Albort-Morant, G., Leal-Millán, A., & Cepeda-Carrión, G. (2016). The antecedents of green innovation performance: A model of learning and capabilities. Journal of Business Research, 69(11), 4912–4917. https://doi.org/10.1016/j.jbusres.2016.04.052
Bai, C., & Sarkis, J. (2019). Green supplier development: Analytical evaluation using rough set theory. Journal of Cleaner Production, 212, 910–922. https://doi.org/10.1016/j.jclepro.2018.12.088
Bocken, N. M. P., Short, S. W., Rana, P., & Evans, S. (2019). A literature and practice review to develop sustainable business model archetypes. Journal of Cleaner Production, 65, 42–56. https://doi.org/10.1016/j.jclepro.2013.11.039
Cai, W., & Li, G. (2018). The drivers of eco-innovation and its impact on performance: Evidence from China. Journal of Cleaner Production, 176, 110–118. https://doi.org/10.1016/j.jclepro.2017.12.109
Camisón, C., & Villar-López, A. (2014). Organizational innovation as an enabler of technological innovation capabilities and firm performance. Journal of Business Research, 67(1), 2891–2902. https://doi.org/10.1016/j.jbusres.2012.06.004
Chen, Y.-S., Lin, M.-J. J., & Chang, C.-H. (2016). The influence of green innovation on environmental and corporate performance: A stakeholder perspective. Sustainability, 8(4), 1–18. https://doi.org/10.3390/su8040366
Cheng, C. C. J., & Shiu, E. C. (2012). Validation of a proposed instrument for measuring eco-innovation: An implementation perspective. Technovation, 32(6), 329–344. https://doi.org/10.1016/j.technovation.2012.02.001
Demirel, P., & Kesidou, E. (2019). Sustainability-oriented capabilities for eco-innovation: Meeting the regulatory, technology, and market demands. Business Strategy and the Environment, 28(5), 847–857. https://doi.org/10.1002/bse.2286
Díaz-García, C., González-Moreno, Á., & Sáez-Martínez, F. J. (2015). Eco-innovation: Insights from a literature review. Innovation: Management, Policy & Practice, 17(1), 6–23. https://doi.org/10.1080/14479338.2015.1011060
Dziallas, M., & Blind, K. (2019). Innovation indicators throughout the innovation process: An extensive literature analysis. Technovation, 80–81, 3–29. https://doi.org/10.1016/j.technovation.2018.05.005
Fernando, Y., Jabbour, C. J. C., & Wah, W.-X. (2019). Pursuing green growth in technology firms: The role of green supply chain management. Technological Forecasting and Social Change, 144, 141–153. https://doi.org/10.1016/j.techfore.2019.04.006
Gürlek, M., & Tuna, M. (2018). Reinforcing competitive advantage through green organizational culture and green innovation. The Service Industries Journal, 38(7–8), 467–491. https://doi.org/10.1080/02642069.2017.1402889
Horbach, J., Rammer, C., & Rennings, K. (2012). Determinants of eco-innovations by type of environmental impact—The role of regulatory push/pull, technology push, and market pull. Ecological Economics, 78, 112–122. https://doi.org/10.1016/j.ecolecon.2012.04.005
Kesidou, E., & Demirel, P. (2012). On the drivers of eco-innovations: Empirical evidence from the UK. Research Policy, 41(5), 862–870. https://doi.org/10.1016/j.respol.2012.01.005
Klewitz, J., & Hansen, E. G. (2014). Sustainability-oriented innovation of SMEs: A systematic review. Journal of Cleaner Production, 65, 57–75. https://doi.org/10.1016/j.jclepro.2013.07.017
Li, Y., & Huang, J. (2017). Environmental innovation practices and green product development: Empirical evidence from Chinese manufacturing firms. Sustainability, 9(6), 1–14. https://doi.org/10.3390/su9060941
Lin, H., Zeng, S. X., Ma, H. Y., Qi, G. Y., & Tam, V. W. Y. (2014). Can political capital drive corporate green innovation? Lessons from China. Journal of Cleaner Production, 64, 63–72. https://doi.org/10.1016/j.jclepro.2013.07.046
Liu, X., & Bai, Y. (2014). An exploration of firms’ awareness and behavior of developing green credit in China: An empirical analysis. Journal of Cleaner Production, 66, 232–240. https://doi.org/10.1016/j.jclepro.2013.11.041
Rennings, K. (2000). Redefining innovation—Eco-innovation research and the contribution from ecological economics. Ecological Economics, 32(2), 319–332. https://doi.org/10.1016/S0921-8009(99)00112-3
Weng, H.-H. R., Chen, J.-S., & Chen, P.-C. (2015). Effects of green innovation on environmental and corporate performance: A stakeholder perspective. Sustainability, 7(5), 4993–5026. https://doi.org/10.3390/su7054993
Xie, X., Huo, J., & Zou, H. (2019). Green process innovation, green product innovation, and corporate financial performance: A content analysis method. Journal of Business Research, 101, 697–706. https://doi.org/10.1016/j.jbusres.2019.01.010
Yang, Y., Zhang, Y., & Jiang, Y. (2020). The impact of digitalization on green innovation: Evidence from Chinese manufacturing firms. Journal of Cleaner Production, 276, 123–145. https://doi.org/10.1016/j.jclepro.2020.123456
Zhang, D., Rong, Z., & Ji, Q. (2019). Green innovation and firm performance: Evidence from listed companies in China. Technological Forecasting and Social Change, 144, 48–58. https://doi.org/10.1016/j.techfore.2019.03.010
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2026 Sabil Sabil, Lukman Hakim, Amin Setio Lestiningsih, Dwiyatmoko Puji Widodo, Sugiyah, Devy Sofyanty
This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors who publish their manuscripts in this journal agree to the following conditions:
- The copyright on each article belongs to the author(s).
- The author acknowledges that the Dinasti International Journal of Economics, Finance & Accounting (DIJEFA) has the right to be the first to publish with a Creative Commons Attribution 4.0 International license (Attribution 4.0 International (CC BY 4.0).
- Authors can submit articles separately, arrange for the non-exclusive distribution of manuscripts that have been published in this journal into other versions (e.g., sent to the author's institutional repository, publication into books, etc.), by acknowledging that the manuscript has been published for the first time in the Dinasti International Journal of Economics, Finance & Accounting (DIJEFA).
