Fostering sustainable entrepreneurial intention: the role of institutional factors

Abstract

Sustainable entrepreneurship (SE) is crucial in achieving the 17 sustainable development goals (SDGs). However, many micro-, small- and medium enterprises (MSMEs) in Malaysia are still considered conventional businesses; therefore, it is necessary to transform them into sustainable enterprises. The initial step is to build up their intention towards SE. However, studies pertaining to SE intention are still considered low. Therefore, this study examined the influence of institutional factors on SE intention among Malaysian MSMEs. The institutional model was employed in identifying the influencing factors, namely governmental actions, social norms, and time orientation. A quantitative research method was employed. The sample was selected using proportionate stratified sampling. A total of 342 owner-managers of manufacturing MSMEs were surveyed using an online self-administered questionnaire. The collected data was analyzed through partial least squares-structural equation modeling (PLS-SEM). The results revealed that governmental actions, social norms, and time orientation were significant in influencing SE intention positively. It could be concluded that components in the institutional model should not be neglected in fostering SE intention. This study shed light on the applicability of institutional theory in studying SE intention and pointed out the crucial factors that should be taken into consideration when encouraging MSMEs to embark on SE.