Influence of Green Entrepreneurship on the Sustainability of SMEs in a Green Economy: Concerning the Southern Province, Sri Lanka.

Abstract

Green entrepreneurship is an increasingly valuable approach for aligning business growth with environmental sustainability. This study investigates the influence of green entrepreneurship on the sustainability of SMEs in the Southern province in Sri Lanka, a region reliant on agriculture, fisheries, tourism, and manufacturing. Amid global environmental concerns, green entrepreneurship integrates economic growth with ecological responsibility, offering SMEs a pathway to enhance competitiveness and resilience in a green economy. The research examines how green practices such as green innovation, energy efficiency, sustainable marketing and so on, impact SMEs' economic and environmental performance, while identifying barriers like financial constraints and limited policy support. Using a convenience sampling method, data were collected from 349 SMEs across Galle, Matara, and Hambantota districts through structured online surveys. The data were analysed using correlation, ANOVA, and multiple regression analysis. The results indicate that green innovation, knowledge, socio-environmental concerns, and marketing significantly contribute to SME sustainability. However, perceived green values and green energy and resource use showed no significant impact. The study highlights opportunities like cost reduction and market appeal, alongside challenges such as high initial cost and inadequate funding. It underscores the need for policy incentives and technical support to foster green practices, positioning SMEs as key contributors to Sri Lanka’s sustainable development goals.