Sustainable business practices in manufacturing SMEs: The mediating effect of dynamic capabilities

Abstract

Abstract This study aims to assess the economic, social, and environmental sustainability of Malaysian manufacturing small and medium‐sized enterprises (SMEs) and the role of dynamic capacities in promoting sustainable business practices. The data was gathered through a survey completed by 216 Malaysian manufacturing SMEs with an SEM‐AMOS nested model comparison analysis. The findings revealed that economic, social, and environmental dimensions are related to sustainable business practices. Besides, firms' dynamic capabilities fully mediate the association between economic, social, and environmental dimensions in Malaysian manufacturing SMEs. This study intended to assist academics, practitioners, policymakers, and other sectors in establishing sustainability to achieve the Sustainable Development Goal 9: Industry, Innovation, and Infrastructure (SDG 9).