Crafting Greener Future - Strengthening Sustainable Environmental Performance of SME Sector Through Green Practices: the Mediating Role of Green Innovation

A growing number of studies show that SMEs are becoming more conscious of the importance of environmental issues. This research delves into how green practices might help small and medium-sized enterprises (SMEs) in Bangladesh improve their environmental performance over the long term. To be more precise, this study intends to investigate the role of green innovation as a mediator between environmentally conscious activities and long-term environmental performance. For research purpose, a standardized questionnaire was circulated among people who belong to SME sector and 403 data were obtained. We have analyzed the acquired data using SmartPLS4 and SPSS. The relationship between the predictor and predicted variables was investigated using Partial Least Squares Structural Equation Modeling (PLS-SEM). Environmental sustainability strategy, green supply chain management, green human resource management, green information technology, all components of green practices—have an immediate effect on sustainable environmental performance, and green innovation both directly affects and mediates the relationship between these two concepts. Industries and government policymakers may learn a lot from this study, which shows that they need to work on methods to improve environmental performance in order to achieve sustainability. Acquiring environmental sustainability can help our nation attain economic prosperity and accomplish three SDGs.