Strategy for increasing green economic performance of small and medium enterprises based on green business management

Abstract

Green management behavioral is quite pertinent to enhance small and medium enterprises economic green performance. Micro, small and medium enterprises (MSMEs) need to adopt environmental paradigms in order to reach the economic green performance. The purpose of this study was to examine relationships between green management and competitive advantage strategies for increasing green economic performance MSMEs in Central Java Province. The population of this study was MSMEs in Central Java. This study was quantitative analysis. The analytical tool in this study used Structural Equation Modeling (SEM) with warp PLS program applications. The results showed that MSMEs that implement green management in their business operations can improve company performance through the ability to compete with these MSMEs. MSMEs could be implementing Green management activities by producing environmentally friendly products, campaigning for environmentally friendly movements, investing capital in environmentally friendly businesses and allocating costs for waste treatment, implementing quality standards that are environmentally friendly in the production process. The better MSMEs in implementing green management, the better MSMEs in competing in the industry, which will improve the company’s green performance such as getting financial benefits from managing environmentally friendly businesses, getting bonuses in the form of prizes from private/government institutions for implementing environmentally friendly businesses, get bonuses in the form of tax rate relief from the government, get bonuses in the form of soft loans from private/government institutions as well as increased sales of MSME products due to applying environmentally friendly businesses. Thus, the application of environmentally sound business management (green business management) needs to be developed among MSMEs players. This is because MSMEs can not only increase additional income, but MSMEs can also participate in preserving the environment.

Creating Model of Sustainable Performance based Green Management System on The Small and Medium Enterprises

“…The results of this study support the results of research conducted by [Naffziger, 2003;Raharjo, 2018;Putri, 2020] who propose how the application of environmental based management in a business unit can create improved performance for the business unit. Such as improved their financial advantage (profit, addition of asset value) and non-financial benefit (well reputation, opportunity, happiness) with environmental preservation.…”

“…The results of this study are on the same track as the results of research Putri et al (2020) which confirms that the application of Green Management can improve the green performance of SMEs through the application of competitive advantage. Therefore, the better the company implements green management in the industry, the better the company's performance through competitive advantage.…”

Does air pollution prompt corporations to implement green management? Evidence from China

“…Louis and Mafini ( 2018 ) argued that the goal of green management is to achieve the coordinated development of economy, society, and the environment through activities such as R&D, production, and marketing. Therefore, green management integrates the ideas of environmental protection into the entire production and operation (Putri et al 2020 ; Rustam et al 2020 ; Wu and Chen 2014 ). The impact of air pollution on corporate green management involves business process level and employee management level.…”

How do businesses achieve sustainable success and gain a competitive advantage in the green era?

“…Today, e-commerce is an inseparable part of the business for a variety of reasons, including the wide variety, universal accessibility, ease of use, manageable compassion of products from trusted payment ways, the convenience of home shopping and different vendors with the least waste of time (Alamdari et al, 2020). In the era of intense industrial competition, the subject of environmentally friendly industries has been highly encouraged (Putri et al, 2020). Developing a competitive advantage may be a vital success factor for a new, small and emerging business venture.…”

“…, 2020). In the era of intense industrial competition, the subject of environmentally friendly industries has been highly encouraged (Putri et al. , 2020).…”