A selection of interesting research and articles we found recently on SMEs and Sustainable Leadership practices.

Social and environmental performance in SMEs
Richard Arend analysed survey data of US small- and medium-sized enterprises, asking how these entrepreneurial ventures can build a competitive advantage with their social and environmental practices. He focused on several firm characteristics and choices involving motivations and capabilities.

Arend found that an orientation to, commitments to, and dynamic flexibility in, the firm’s CSR and green policies are significant factors in a firm’s CSR- and green-based competitive advantages. So, while some tradeoffs are likely between activities aimed at financial performance and those also aimed at improving social/environmental performance, opportunities do exist for small- and medium-sized enterprises to do both well and good.

Read more in: Richard J. Arend. 2014. Social and Environmental Performance at SMEs: Considering Motivations, Capabilities, and Instrumentalism.
Journal of Business Ethics, 125(4), 541-561.


Are key employees different from owners and other employees in SMEs?
Yes, according to Francine Schlosser, who investigated how to identify and differentiate key employees SME owners and other employees, as well as how key employees influence firm success factors. Interviews are conducted with 14 matched pairs of entrepreneurs and key employees operating Canadian SMEs.

The study found that the key employee typically (1) corresponds to the key success factors of the SME, (2) is willing to undertake a moderate amount of risk, and (3) differs in education and experience from the entrepreneur/owner.

Full text is freely available at: Francine Schlosser. 2015. Identifying and Differentiating Key Employees from Owners and Other Employees in SMEs.
Journal of Small Business Management, 53(1), 37–53.


SME compliance with environmental regulations
Gary Lynch-Wood and David Williamson explored the impact of civil regulation on the environmental behaviour of SMEs. They showed that although civil regulatory pressures are generally subdued, and conventional regulation continues to be an important driver of behaviour, in some circumstances civil pressures nevertheless produce a ‘regulatory’ stimulus. Where they do, it appears that civil regulatory pressures tend to derive from stakeholders pursuing relatively narrow self-interest (rather than public interest) mandates. Furthermore, they normally target particular issues rather than ‘social responsibility’ in any broad sense. SME responses typically take the form of compliance-reinforcing (rather than beyond compliance) measures.

For SMEs, it is suggested that, in some circumstances, civil regulation provides a bespoke regulatory mechanism that is more likely to bring about changes in basic practices on narrow issues. It can also be seen as producing a particular type of consensual micro-social contract and public interest service.

Details at: Gary Lynch-Wood and David Williamson. 2014. Civil Regulation, the Environment and the Compliance Orientations of SMEs.
Journal of Business Ethics, 125(3), 467-480.


Use of sustainability management tools in SMEs
Many scholars have emphasised the importance of sustainability management in small and medium-sized enterprises (SMEs). Although various publications discuss different approaches and potential barriers of implementation, a review of the existing research on sustainability management tools for SMEs is nonetheless missing. Based on a systematic review of the academic literature, Matthew Johnson and Stefan Schaltegger discuss reasons why SMEs should implement sustainability management tools.

A further analysis reveals that most such tools are perceived to have little to no implementation in SMEs. The main implementation barriers and facilitating criteria are discussed. In addition, implications for future research, SME management, and public policy are drawn.

For further details, see: Johnson, M. P. and Schaltegger, S. 2015. Two Decades of Sustainability Management Tools for SMEs: How Far Have We Come?
Journal of Small Business Management