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The IUP Journal of Management Research :
Sustainable Development Practices Adopted by SMEs in a Developing Economy: An Empirical Study
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The dynamic global business scenario has created the need for sustainable businesses. Sustainability is the new buzzword generating a need to rewrite business strategies across all enterprises, big or small. For creation of such strategies, there is a need to understand the prevalent sustainability scenario. With hardly any research on this subject in the small business context, an attempt is made in this paper to understand the sustainability practices in Small and Medium Enterprises (SMEs). The primary data of 220 SMEs in Coimbatore has been collected using a structured questionnaire. Environmental, economic and social sustainability practices undertaken by such firms have been studied. Policy makers and academicians can use the findings of this study to devise policies and training programs exclusively for the SMEs to enable them to become sustainable businesses of the future.

 
 

“Sustainable Development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (WCED, 1987). Wealth creation without harming the environment and at the same time also giving back something to the society is the fundamental principle of the concept of sustainability. From a business perspective, it simply means that wealth maximization cannot become the sole objective of any business. Consequently, the ways and means used by firms to achieve wealth maximization has come under the scanner.

Small and Medium Enterprises (SMEs) contribute to 16% of the Gross Domestic Product (GDP) in low-income countries and 51% in high-income countries (Edinburg Survey, 2010). In India, SMEs make up 80% of the total industrial enterprises, provide employment to more than 100 million people and contribute 8% of the country’s GDP (Assocham SME Expo, 2015). Though the impact of SMEs on environment and society is insignificant when considered individually, the collective impact cannot be underestimated and hence justifies research attention (Johnson and Schaltegger, 2016). However, the available research in sustainability has been focusing for a long time only on large firms (Hillary, 2000) and a huge vacuum exists in the SME literature on sustainability (Sloan et al., 2013).

 
 

Management Research Journal