Entrepreneurial orientation and sustainability initiatives in family firms

Abstract

Purpose This paper aims to examine the relationship between family firm generation, performance and entrepreneurial orientation (EO) in investments in sustainability initiatives. The objective of this research is to establish EO as an important antecedent of investments in sustainability initiatives, assess EO’s interaction with firm performance and establish that later-generation family firms are more environmentally and socially responsible. Design/methodology/approach Data were collected in-person from 151 top managers in automobile and motorcycle dealerships in the southwestern USA. Regression analysis was utilized to analyze the hypothesized relationships. Findings EO is significantly and positively related to investments in sustainability initiatives. That relationship is dependent on the performance of the firm. At low levels of EO, high-performing firms invest significantly more in sustainability initiatives. However, at high levels of EO, low-performing firms invest slightly more in sustainability initiatives. The generation of the family business is moderately related to sustainability investments, with later-generation family firms investing more. Originality/value The findings herein bridge the gap between the entrepreneurship and sustainability literature by establishing EO as an important antecedent of corporate responsibility. Further, the results indicate that firm mechanisms such as EO are more important than the performance of the firm or slack resources available.

Entrepreneurial Orientation and Innovation for Improving Competitive Advantage

“…Entrepreneurial orientation essentially is a process, structure, and corporate taking that are reflected in their ability to carry out innovation activities, show proactive behavior, and the courage to take risks [15]. As a research finding, in conducting innovation activities, companies have a tendency to be creative and dare to experiment in creating products, services, or process development.…”

“…Meanwhile, a proactive attitude is an initiative of the company to investigate and monitor opportunities carefully with the aim of moving better and faster than competitors. Through a proactive attitude, companies can create profits as first movers by becoming the first in a variety of ways, including the first to enter the market, first to establish brand identity, first to implement a new process, first to put forward ideas for new procedures, or parties first to dare to adopt new technology [15].…”

“…The importance of competitive advantage to improve business performance is inseparable from entrepreneurial orientation [14]. Entrepreneurial orientation is proven to have an impact on company performance which is the forerunner of forming competitive advantage in the company [15]. Of course, the company's orientation is influenced by the entrepreneur's personal value as the company's main navigator.…”

“…Entrepreneurial orientation is a significant contributor to the success of a company, with dimensions of creativity, innovation, and courage in facing risks that are carried out by working hard to form and maintain new businesses [15]. Furthermore, the researcher states that entrepreneurship education can improve ways of thinking and acting to achieve maximum results in business [20].…”

Manager’s Age, Sustainable Entrepreneurial Orientation and Sustainable Performance: A Conceptual Outlook

“…The innovativeness dimension of EO helps develops sustainable products and services that result in improved health and safety of customers. The risk-taking attribute will let organizations avoid products that are affecting the health of society [23,67].…”