Green Entrepreneurship as a Sustainable Business Model: Key Lessons for SMEs

At the global level, green entrepreneurship has increasingly been positioned as a key innovative mechanism for advancing energy efficiency, promoting resource reuse through circular economy principles, and fostering the development of clean technologies. Our study contributes to the knowledge field by examining the extent to which green entrepreneurship functions as a sustainable business model, while also identifying the key opportunities, challenges, and different constraints. The main purpose of our analysis is to emphasize the role of the legislative framework in promoting green entrepreneurship and its significance for the economy. The research employs both qualitative and quantitative methods, combining bibliometric and empirical analyses in a complementary manner. The data used in this research are panel data, collected from Eurostat, OECD and the World Bank, and the sample consists of the 27 member states of the European Union, over the period 2008–2022. A particularly underexplored area we address is the role of green financing, which supports ecological entrepreneurship but also imposes specific compliance requirements that can be both beneficial and demanding for businesses. We further highlight how governmental decisions influence the entrepreneurial landscape and sustainable development efforts, helping to clarify the relationship between green entrepreneurship and economic growth. The topic remains insufficiently addressed in existing research, with a limited number of studies dedicated to this intersection of entrepreneurship, sustainability, and environmental policy. Our findings offer relevant insights for both the business environment and policymaking, emphasizing the strategic importance of green entrepreneurship in achieving resilient economic transformation. In particular, our research highlights that Regulatory Quality, Rule of Law, Government Effectiveness and FDI availability are essential factors contributing to the development of eco-innovative entrepreneurship, providing key lessons for policymakers and the business community. JEL Classification : G41; L26; Q01.