Green Responsibility or Social Commitment: Which Matters More for Generating Sustainable Competitive Advantage for MSMEs

Abstract

This study analyse the effect of philanthropic and environmental practices on the sustainable competitive advantage (SCA) of micro, small, and medium enterprises (MSMEs) in the state of Haryana. The primary data used in the study were collected through questionnaires from a total sample of 347 MSMEs. The Partial Least Squares Structural Equation Modelling (PLS-SEM) statistical technique, including importance-performance matrix analysis (IPMA), was used for analysing the primary data. The findings indicate that both Philanthropic corporate social responsibility (CSR) and Environmental CSR significantly positively affect SCA. However, Environmental CSR showed more prominence in terms of importance and performance for promoting competitiveness among MSMEs. It can thus be concluded that environmental sustainability, in addition to philanthropy through CSR, positively influences reputation, efficiency, and competitiveness. This study is consistent with the resource-based view (RBV) framework because it highlights the importance of CSR as a strategic resource. Thus, the study provides valuable managerial and policy implications for promoting sustainable business practices that provide competitiveness among MSMEs in emerging economies like India.