In this special issue titled ‘Sustainability and SMEs: Opening the black box’, we compile eight articles that dissect the multifaceted relationship between small- and medium-sized enterprises (SMEs) and sustainability. This special issue promoted interdisciplinary research at the intersection of the design, management, organisation, and reporting of sustainable actions in the context of SMEs. Stemming from the need to apply different theoretical and analytical lenses to the study of sustainability in SMEs than in large corporations, each paper provides unique insights into the formal and informal approaches, drivers, barriers, and enablers of sustainable practices in SMEs. The collection not only furthers the dialogue on the role of SMEs in sustainable development but also paves the way for future research directions and practical applications in this dynamic and still underexplored field.

This research aims to unpack how digital technologies can facilitate the flourishing of circular business practices in small- and medium-sized enterprises by structuring a detailed going circular path that explains businesses’ evolution toward circularity. In doing so, it outlines how the observed organizations have adopted – or are adopting – circular economy principles thanks to business digitalization. Following an inductive approach based on a multiple case study methodology, we investigated 16 small- and medium-sized enterprises operating in industries that put considerable pressure on the environment (e.g., manufacturing, chemical, construction, fashion, food, and beverage). Our findings confirm how digital technologies, as well as Industry 4.0 structures, play a fundamental role in shaping, enabling, enhancing, and refining circular products and processes development. Accordingly, we outline a generalizable step-by-step process to pursue circular economy by employing digital technologies. The present study represents a practical handout for guiding companies through their going circular path.

An increasing number of small and medium enterprises (SMEs) are focusing on sustainable development and on embracing sustainable business models (SBMs). Despite the growing interest of academics and practitioners in SBMs, and the benefits for stakeholders, there is limited knowledge regarding the factors enabling SME transition toward SBMs, leading them to integrate sustainable principles in their BMs. This study explores the enabling factors for SBM adoption by SMEs and provides an improved understanding of this recent phenomenon. Understanding what factors enable adoption of SBMs is crucial for both SMEs and policymakers. The research uses an inductive qualitative research design approach focused on multiple case studies. The findings reveal that both internal and external factors play a key role in enabling SME transition toward SBM adoption. The internal factors that emerged include openness, change of mindset, problemistic search, social exchange, and resource valorization, while external factors included markets change, technological innovation, stakeholders’ influences, policy and institutions.

Addressing major global environmental and social challenges requires transformation of the private sector. Small- to medium-sized enterprises (SMEs) constitute 90% of private organisations globally, resulting in calls for research into the strategic roles SMEs can play in shaping sustainable futures through adopting sustainable business models (SBMs). The purpose of our study is to understand the factors that allow SMEs to successfully adopt SBMs. We used an exploratory qualitative approach drawing on interviews with SMEs implementing SBMs. Our findings extend contemporary insights by revealing the important role of the external support (‘enabling’) environment, and identifying—potentially transformative—capabilities that can help steer SMEs’ transitions to SBMs. These include persistence, tenacity, flexibility, adaptability, and a willingness to learn and fail. They enable SMEs to successfully operate in times of uncertainty and rapid changes in the external environment, and respond to new requirements through changes to their business models.

Medium Enterprises (MEs) are significant contributors to global economic development. Integrating sustainability practices in their business can support MEs worldwide to become more sustainable, improving companies’ performance and stakeholders’ expectations. Nevertheless, few MEs adopt sustainable practices. Following Behavioral Decision Theory and Behavioral Strategy literature, we argue that this can be associated with their managers’ decision-making processes – apart from not possessing considerable resources like large companies. Via a mixed-method research design involving 277 Italian ME managers, we investigate the cognitive biases that hinder the development of a sustainable performance management system (SPMS) in MEs. We found the most prominent biases influencing SPMS development. Then, we developed a ‘SPMS de-biasing funnel’ framework. We propose some corrective actions to reduce the impact of the most critical cognitive biases that influence SPMS development, allowing related beneficial potential outcomes.

This study investigates the managerial approaches family SMEs adopt to address sustainability in the context of the Blue Economy. Using a qualitative methodology, we conduct nine case studies of family firms operating in Sicily's COSVAP Fishing District area. The data are collected via semi-structured interviews with the founders/managers and analyzed using the Gioia method. The results reveal that family SMEs approach sustainability by adopting three managerial approaches. In the first approach, SME managers conceive sustainability as a threat to the economic sustainability of their firms. The second approach implies that sustainability must undergo specific compromises. The third approach considers sustainability as an opportunity whereby social, environmental, and economic sustainability goals are balanced. Regarding the theoretical implications, our work provides a comprehensive account of managerial approaches of family SMEs toward sustainability. The study offers insights for practitioners and policymakers concerning how to facilitate the transition of family SMEs – and, specifically, fisheries – toward sustainability.

Startups play a crucial role in advancing the Sustainable Development Goals (SDGs) through their innovative solutions that increasingly focus on sustainability. However, they face significant challenges in effectively assessing their contribution to the SDGs. In our study, by adopting an action-research methodology, we develop and introduce Prosper, i.e., a tailored social impact assessment (SIA) framework for startups. First, we conducted a comprehensive review of existing methods and standards for assessing social impact to establish an initial foundation of Prosper. Second, we refined Prosper based on an empirical validation on five startups. By embracing action research, we aim to empower startups with a robust and user-friendly tool, which facilitates SIA and representation. We also contribute to the literature aimed at overcoming the existing sustainability barriers for startups and to respond to the call for assisting them in reporting about SDGs. We also discuss practical implications and future research avenues.

This research aims to analyse the links and potential limiting and supporting factors between sustainability actions and sustainability reporting. Comparing companies involved in sustainability actions and those whose reporting practices lack a formal reporting system, this analysis focuses on Italian small and medium-sized enterprises (SMEs) in the meat and cured meat industry, identifying the perspective (formative) that links sustainability action to communication in these SMEs. The qualitative interpretative approach, based on semistructured interviews, highlights the relevant strengths and weaknesses concerning substantive sustainability actions and the effect of communication on them, providing implications for international and sectoral policies and management choices. Filling a gap in the SME literature concerning their approaches to sustainability reporting and action (and the relationship thereof), this study also introduces, as a widely used practice, ‘greenhushing’, i.e., the deliberate absence of or limited communication on effectively implemented sustainability practices or their salient results.

Policymakers, academics, and practitioners are increasingly discussing non-financial reporting (NFR) initiatives, i.e., reporting initiatives that are related to environmental and social matters. The implementation of NFR initiatives in the context of small and medium-sized enterprises (SMEs) is a key topic. Based on a systematic literature review, this article first synthesizes what we know about the mechanisms underlying NFR initiatives implemented by SMEs. A thematic analysis led to the identification and examination of drivers, enabling factors, and challenges for NFR initiatives. Relevant drivers include legitimacy-based motivations, competitive advantage, and stakeholder engagement. Enabling factors include specific guidelines and tools for NFR. Lack of capabilities and lack of standardization are significant challenges. Second, drawing on the thematic analysis and on what we do not know about NFR in the context of SMEs, a novel conceptualization of NFR as a process characterized by three main phases is presented. Last, this article suggests future research opportunities.

The success and competitiveness of an organization recruiting the emerging workforce i.e., millennials can be ascribed in part to the organization's corporate social responsibility (CSR) engagement. This study explores the impact of organizational CSR on Nigerian millennials' joining intention through CSR motive perceptions: CSR-based organizational attractiveness (CSR-based OA) and perceived altruism (PA). To examine the empirical relationship among variables, data were obtained from respondents who were seeking employment or in-between jobs. Results revealed that CSR-based OA and PA significantly mediate the relationship between CSR and millennial joining intention. Findings present a unique perspective that significantly expands the literature. The implications of results are discussed and recommendations to managers are presented.

In 2020, the Barunga Festival would have celebrated its 35th anniversary. In mid-June of 2021, as many as 4,000 individuals were expected to descend on an aboriginal community of 300 residents located 400 km south of Darwin. This case describes the challenge to the Festival's promoters as they seek to sustain peak socio-economic impact in their role as community development change agents in a diverse and dynamic environment. The reader is tasked with clarifying goals, deciding what is at stake, and setting a course of action to realize those objectives.

Globally, organizations are increasingly embracing corporate social responsibility (CSR) to strengthen competitive advantage. Although CSR is recognized to be context-sensitive, the literature is still lacking studies that examine CSR in different contexts, particularly non-western ones. Our study adds to a deeper understanding of CSR in Vietnam by identifying the predictors of CSR attitudes of business students. Vietnam has rich cultural, social, and economic characteristics that offer new theoretical perspectives and insights on the contextual nature of CSR. Our findings showed that CSR attitudes related positively to idealism and student seniority, and negatively to materialism and male students. A positive CSR–relativism relationship was uncovered. Spirituality related positively to the importance of CSR to business sustainability and negatively to CSR's importance to short-term competitiveness. The findings have theoretical and practical implications on the understanding and practice of CSR that would benefit CSR researchers, business organizations, and education institutions.

This study examined the impact of green human resource management (GHRM) and green supply chain management (GSCM) on the economic, social, and environmental performance of 272 (ISO-certified) textile firms in Pakistan. It investigated how a firm's size and the number of years since adopting GSCM practices influence performance. Survey data were collected from these firms through a cluster sampling approach and then analyzed through structural equation modeling. Results highlighted that GHRM positively influences a firm's environmental and social performance. Results further indicated that inbound and outbound GSCM activities mediate between GHRM and a firm's environmental and social performance. The moderation results revealed that a firm's size is crucial for improving performance. From an emerging economy perspective, this study draws the attention of policymakers and managers, concluding that implementing GHRM improves the green orientation of all the departments within a firm and helps organizations achieve sustainability goals.

Ensuring a sustainable future by meeting the Sustainable Development Goals (SDGs) cannot be achieved without women's empowerment and gender equality. This study aims to determine whether there are differences between European banks in terms of their commitment to SDGs and the intensity of this commitment depending on their board gender diversity. A sample of the 50 largest European banks from 2016 to 2020 was used to perform hypothesis testing for differences in means. The results provide robust support for the assertion that banks with greater female representation on the board of directors have a greater commitment to the 2030 Agenda. The originality of this research lies in the use of indicators of commitment to SDGs corresponding to each of the five SDG pillars. This study thus provides the first evidence of the importance of distinguishing between these pillars when examining the relationship between commitment to SDGs and board gender diversity. This evidence advances the scant literature on this relationship.

Using a sample of 21,628 firm-year observations from the Chinese stock market during the period of 2008–2017, this study finds that the divorce–marriage ratio, the proxy for marital demography, is significantly positively associated with corporate greenwashing. This finding suggests that higher divorce–marriage ratio is associated with stronger individualistic social atmosphere, lower conformity to social norms, and more unfavorable attitude towards environmental conservation, abets firms to talk the talk rather than walk the walk, and foments corporate greenwashing. Moreover, China's Environmental Protection Law attenuates above positive relation. Lastly, our conclusions are robust to sensitivity tests using the divorce rate, alternative proxies for greenwashing, and individual-level divorce data, and further our findings are also valid after addressing the endogeneity issue.

This study provides a new perspective on the determinants of the spread of voluntary corporate social responsibility (CSR) adoption by incorporating the potential role of its adoption by industry competitors. We find supportive evidence that firms make CSR adoption decisions in response to competitive pressure as well as institutional mimetic pressures. Based on an event history analysis of longitudinal data from a sample of 711 Korean publicly traded firms over a 12-year period, our findings suggest that the CSR behavior of competitors is positively associated with a focal firm's earlier adoption of CSR, leading to the diffusion of CSR across firms. Specifically, this study shows that the pure rivalry-driven pressure from non-leader competitors has a stronger positive relationship with earlier CSR adoption. The results also indicate that a firm's CSR adoption decision is accelerated by competitive rivalry as well as social pressures arising from institutional mimetic isomorphism.