Published Online:April 2026
Product Name:The IUP Journal of Corporate Governance
Product Type:Article
Product Code:IJCG010426
DOI:10.71329/IUPJCG/2026.25.2.5-27
Author Name:Naveen Kumar, Janani M, Meenakshi Saratha, Ramadevi and Muthu Kumar T
Availability:YES
Subject/Domain:Management
Download Format:PDF
Pages:5-27
The study seeks to examine how governance practices influence the sustainable growth of small and medium-sized enterprises (SMEs). Drawing data from 386 SMEs in Bengaluru, Karnataka, India, and employing Structural Equation Modeling (SEM), it analyzes the role of board structure (BS), transparency (TRS), risk management (RM), decision-making (DM), and accountability (ACC) in driving sustainability. The findings indicate that BS, TRS, and RM are the most significant contributors to SME sustainability, enhancing strategic choices, stakeholder trust, and organizational resilience. DM shows a conditional effect, while ACC is most effective when embedded within broader governance frameworks. The study integrates Agency and Stakeholder Theories to explain governance-sustainability linkages, offering a context-specific framework for SMEs in emerging markets. By aligning governance mechanisms with sustainability outcomes, the study provides practical implications for entrepreneurs, policymakers, and support agencies, highlighting the need for transparent practices, diverse boards, robust risk management, and governance training to achieve longterm growth and resilience.
Small and medium-sized enterprises (SMEs) are widely recognized as the backbone of most economies, playing a vital role in employment generation, innovation, and local development. Despite their significance, the sustainability of SMEs remains a persistent challenge due to their vulnerability to internal inefficiencies and external uncertainties.