Abstract

LAILY, Nur et al. The role of Green Business Strategy in mediating the relationship between environmental orientation and SMEs. SAJESBM [online]. 2025, vol.17, n.1, pp.1-13. ISSN 2071-3185.  https://doi.org/10.4102/sajesbm.v17i1.978.

BACKGROUND: This study examines the influence of Green Business Strategy on the performance of small and medium enterprises (SMEs) with a particular focus on its mediating role in the relationship between strategic orientation and performance, as well as its implications for long-term sustainability AIM: This study seeks to provide empirical evidence on the strategic role of green business as a mediating factor in the relationship between environmental orientation and the performance of SMEs SETTING: The continuously evolving competitive landscape in the digital era has made the ability to generate innovative ideas a crucial aspect for SMEs. Therefore, understanding the role of Green Business Strategy as a mediator in the relationship between environmental orientation and SME performance has become increasingly important METHODS: This study examines 103 SME participants in East Java, Indonesia, employing a quantitative research approach. Data were collected through a semi-structured questionnaire. Mediation analysis and t-tests were conducted using SmartPLS 3.0 to trace relationships within the dataset RESULTS: The empirical findings indicate that Green Business Strategy serves as a mediating factor in the relationship between environmental orientation and SME performance in East Java, Indonesia CONCLUSION: The study on SMEs in East Java is limited by data availability. A comparative analysis with publicly traded firms and longitudinal data could strengthen findings. Future research should include SMEs from both Asian and European contexts for more comprehensive policy implications CONTRIBUTION: The study suggests that SMEs can adopt a Green Business Strategy encompassing environmental orientation, environmental performance, top management environmental awareness and SME performance to achieve long-term sustainability and enhanced business

Keywords : Green Business Strategy; environmental orientation; environmental performance; top management environmental awareness; SMEs performance; SmartPLS; SEM.

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