Sustainable Entrepreneurship Development: The Management of Value Adding and Wealth Creation in the Gambia 

The Management of Value Adding and Wealth Creation in the Gambia

Info: 2898 words Sample Literature Review
Published: 20th DEC 2022

Tagged: Business & Management

Share this:

• Facebook
• Twitter
• LinkedIn  
• Whatsapp 

2.1 Introduction

Entrepreneurship and moral behavior go hand in hand very closely. For instance, it would be assumed that characteristics of entrepreneurship such as originality, creativity, and sensitivity are similar to those required for making moral decisions (Buchholz & Rosenthal, 2005). As entrepreneurs run their company, entrepreneurs must also deal with a number of difficulties. In light of the fact that sustainable entrepreneurship is typically associated with the accomplishment of certain goals while also generating profits in the most effective way possible, as was already noted, it may seem rather out of place. Shane and Venkataraman (2000) have emphasized this characteristic, through their research where they have created a conceptual framework for entrepreneurship. Giving a sustainable perspective to a business venture would diverge from the objective of maximizing profits due to the extra costs associated with sustainable products and practices that entrepreneurs might give-up by simply choosing an option that turns out to be the least expensive. Naturally, it goes without saying that pricey is a common attribute of sustainable goods and services. As compared to non-sustainable goods and services, these are frequently regarded as being astronomically expensive.

For instance, in a survey conducted by the Institute of Materials Research and Engineering (IRME), nearly 82 percent of interior designers and 90 percent of architects agreed that sustainable items were more expensive than non-sustainable ones. The survey had a total of 812 responses. This fact was supported by Aupperle et al. (1985), who claimed that socially responsible businesses suffer from a lack of competitive advantage due to the extra expenses they incur, which tend to reduce profits, especially since there was opportunity to prevent such expenses overall or have them covered by the government or by individuals. Even in situations where there is a market for sustainable products, the additional risks, maintenance costs, and start-up costs may prove to be too much to bear when considering a start-up venture. According to definition, it is not very common for entrepreneurs to view sustainability as a key component. However, some economists have had the foresight to recognise how entrepreneurs with a sustainable mindset can help the economy grow while also promoting social advancements, helping to reduce the world's finite resource consumption, and even possibly creating new, novel products.

Sustainable entrepreneurial strategies have received widespread recognition for their ability to address both social and environmental issues (Hockerts & Wüstenhagen, 2010). These socially and environmentally conscious people often have a fundamental impact on society because they are renowned for offering solutions to complex social problems that are either ignored, passed over, or have been unsuccessfully addressed by governments, civil society organizations, and established businesses (Cohen, S.; Taylor, S.; Muller-Camen, 2012). However, it is thought that there is a knowledge gap when it comes to sustainable entrepreneurs. For instance, the method sustainable business owners establish their enterprises and the difficulties they encounter during this process are not thoroughly recognised. Sustainable entrepreneurs are reported to face unique difficulties when starting their firms, as opposed to normal business owners. Due to the conflict between the creation of societal value and the creation of private value, challenges of this nature may arise (Pinkse & Groot, 2015).

This chapter will review the existing literature pertaining to sustainable entrepreneurship and initially commences by defining specific terms, followed by…..

2.2 Essentials of a Sustainable Entrepreneur

Hoessle (2013) played an essential role in outlining the ten actions that should be followed in order to become a sustainable business. As per Hoessle, (2013), In the beginning, an organization must focus on minimizing environmental damage, respecting human rights as they should be, and placing a high priority on the welfare of its employees. Entrepreneurs should find a natural affinity for sustainable entrepreneurship rather than pursuing it as a result of outside pressure. Simply said, the company or person should be eager to adopt sustainable business practices rather than letting competitors or emerging trends influence them. Initiating a sustainable entrepreneurship endeavor should come after having clearly defined business goals and objectives. These goals and objectives need to be closely related to the organization's initiatives and principles so that they become a part of what they actually do and are not seen as something that is being done on the side. In order to ensure that such sustainable initiatives are an important part of what customers utilize and the market then develop to proclaim it as a norm, such aims and objects need to be intimately linked with the requirements of the consumer. It goes without saying that these must be followed long-term at the same time. Sustainable organizations as well as consumers need to have a clear perception of the organization's investment with regard to sustainable entrepreneurship. The relationship between sustainability and its activities and procedures of production needs to be concrete and should be such that it can be defined clearly. Along with making sure they don't overstate their efforts toward sustainable entrepreneurship, they should take care to avoid making the consumer a victim of price increases as a result of adopting sustainable practices.

The organization is expected to make sure that its sustainable practices are implemented by the organization as a whole, rather than only by the management, as another step toward becoming a sustainable entrepreneur. It suggested that everyone at every level of the organizational hierarchy, all the way down to the lowest employee, should adhere to sustainable practices (Salem et al., 2012).

2.3 Benefits of Sustainable Entrepreneurship to Small and Medium Enterprises

According to Mujahid and Noman (2018), in terms of employment and economic growth, small and medium-sized firms (SME's) had a considerable influence on a nation's economy. One of the most impressive findings of the study is the realization that SME's individually have little influence compared to their collective representation, which accounts for 95% of all private sector organizations in the majority of modern nations and accounts for a significant portion of all economic activities. SME exports are also responsible for a sizeable portion of the economic activity on the major continents, which would be between 26 and 60 percent and include the most developed nations as well.

Benis (2014) discusses the benefits of living sustainably for all organisations as well as the negative effects of failing to do so, specifically the result of bad press and being thought to be acting unethically, which would then have a detrimental effect on the organization's reputation and possibly result in a loss of profit, income, and share value. More and more organisations are starting to view themselves as more than merely a corporation that tries to maximise profits, even though they might not be inspired by idealism. Even if they aren't, they can at least get the support of the public by displaying concern for both the environment and other people.

This is the idealism point that is brought up by Benis (2014). Last but not least, it enables a company to differentiate itself from rivals while enticing returns on investment. This is accomplished by referencing current successes like the ABN-AMRO Sustainable World Fund and the SNS Eco Shares Funds, as well as by considering the Dow Jones Sustainability Group Index, which demonstrated that sustainable businesses beat conventional ones in the market.

Vasja Roblek et al. (2018) add that along with the benefits of sustainable entrepreneurship amongst SMEs, they would also be confronted with several challenges. In addition to the thousands of SMEs that have adopted environmentally friendly practises, which are not just having a noticeable impact in comparison to the millions of people in Europe who still need to adopt and implement environmentally friendly practises, even fewer people than that were aware of the concepts of sustainable practises and manufacturing techniques. But fortunately, because to the rise in environmental awareness and the fact that it is being heavily stressed on a global scale, this is not the situation we find ourselves in today. Nevertheless, some of the issues are still there and provide a barrier to SMEs today, particularly those businesses that fall into the micro-SME category. Several of these points, including lack of external communication or lack of awareness of procedures and equipment, have seen a significant reduction in risk given modern technology, sustainable-minded education, and legislation. However, there are still several areas where SMEs are known to struggle. These areas would include the availability of resources like time and money, expertise and skill levels, direct customer contact, and the flexibility to change course.

2.4 Influence of Personal Values on Sustainable Entrepreneurship

According to Conger (2012), gaining a thorough understanding of each individual entrepreneur would be helpful in figuring out not just what motivates people to start their own businesses but also how they might develop into different types of business owners. For instance, some business owners like to create companies with a distinctive environmental or social mission, while others only focus on financial success. Understanding the views and motivations of these entrepreneurs is especially important for the body of study on social or sustainable entrepreneurship that is still in its infancy, as the entrepreneur's personal or individual values serve as the cornerstone of such beliefs and motivations. The importance of the personal values that sustainable entrepreneurs hold that motivate them to make societal, environmental, and environmental changes is frequently highlighted by sustainable entrepreneurship experts (Zahra et al., 2009).

Similar to this, values frequently appear to be a fundamental component of the larger management as well as entrepreneurial literature, particularly when examining company ethics, corporate culture, and executive decision-making (van Praag & Versloot, 2007). However, a more in-depth discussion of values is very uncommon in such studies and is incredibly (Stevens, 2010). Many of these studies have a tendency to only acknowledge the importance of values as a component of a larger theoretical argument.

2.5 Previous Studies

According to Klarin, (2018), sustainable development, also known as sustainability, has been defined as a type of development that satisfies present demands while ensuring that the ability of future generations to satiate their wants is not compromised at any cost. It merely translates into economic growth that includes environmental preservation and meeting human social needs (Mukherjee et al., 2016). Having said that, the idea of sustainable entrepreneurship is inspired by the idea of sustainable development and is actually thought of as an effort to create a balance between a company organization's social, economic, and environmental aims. Specifically, According to Patzelt and Shepherd, (2011), sustainable entrepreneurship is a process that includes the identification, exploitation, and leveraging of possibilities with the goal of producing goods for the future while maintaining sustainability in the social and/or natural environment while promoting progress.

It has been argued by Richomme-Huet and de Freyman, (2014) that on the basis of the amalgamation of social, ecological and economic values that sustainable entrepreneurship concentrates more on conservation of natural, community and life support while pursuing observed opportunities to bring into existence, future processes, services and goods to facilitate gain, wherein gain is widely considered to be inclusive of non-economic and economic gains for individuals, society and the economy.

The results of previous studies have shown how the body of knowledge on sustainable business has grown over time. As per (Kuckertz & Wagner, 2010), while there has been a great amount of research on sustainable entrepreneurship, it has primarily focused on the environmental aspects of business. However, other studies have emphasized more on the social facets of sustainable entrepreneurship. In order to impact sustainable business, Koe et al., (2015) discovered that there were perceptual aspects. Intent and perceived desirability were just a couple of the perceptual elements. Perceived desirability, in the authors' opinion, had a significant influence on what motivated sustainable business. They continue by saying that business owners tended to engage in sustainable entrepreneurship since it contributed to the maintenance of a high standard of life while concentrating on societal welfare in addition to generating wealth.

Findings from a study conducted by Choongo et al., (2019) revealed that values related to self-transcendence made a substantial impact on corporate social responsibility (CSR) which was socially oriented however, it did not have any impact on CSR which was oriented environmentally. When it came to CSR that was socially or ecologically oriented, values relating to sustainability tended to have a negligible positive impact. However, they had no effect on CSR that was environmentally or socially oriented.

According to findings from a research conducted by Laukkanen and Patala, (2014), it has been indicated that common understanding, attitudes and values are some of the challenges that hampers sustainable entrepreneurship adoption by entrepreneurs. Businesses frequently boost their earnings and short-term financial gains while placing less importance on long-term strategic planning. Wach, (2014) state that for domestic companies to enter foreign markets, there are a number of different tactics they might use. One of the most widely used strategies to break into the global market would center on the area of exchange and focus on international trade, mostly through taking on import and export-related operations. A common first step in exporting goods and services to international markets is importing raw materials from international markets. Creating joint ventures in foreign countries, merging with other businesses, and other tactics are additional ways to access the global market. In addition to helping a company develop a footprint in the global market, these tactics also increase the company's goodwill and reputation, which adds value to the firm as a whole.

2.6 Research Gap

Several papers were examined for this research, and the majority of them focused on entrepreneurial behavior, sustainable entrepreneurship practices, factors impacting sustainable entrepreneurship, and difficulties that business owners experience while implementing sustainable practices. There haven't been many studies that concentrate on how sustainable entrepreneurship growth might contribute to value management and wealth generation, notably in the Gambia. Additionally, the fishing industry in the Gambia is the specific subject of this research, which has not previously been investigated. The need for this research is justified by the fact that this shows a significant research gap.

References

Aupperle, K.E., Carroll, A.B. & Hatfield, J.D. 1985. An Empirical Examination of the Relationship between Corporate Social Responsibility and Profitability. Academy of Management Journal. (28)2,. pp. 446–463.

Benis, A.R. 2014. The Impact of Small and Medium-Sized Enterprises on Economic Growth in Iran. Global Journal of Management And Business Research.

Buchholz, R.A. & Rosenthal, S.B. 2005. The Spirit of Entrepreneurship and the Qualities of Moral Decision Making: Toward A Unifying Framework. Journal of Business Ethics. (60)3,. pp. 307–315.

Choongo, P., Paas, L.J., Masurel, E., van Burg, E. & Lungu, J. 2019. Entrepreneurs’ personal values and CSR orientations: evidence from SMEs in Zambia. Journal of Small Business and Enterprise Development. (26)4,. pp. 545–570.

Cohen, S.; Taylor, S.; Muller-Camen, M. 2012. SHRM Foundation’s Effective Practice Guidelines Series HRM’s Role in Corporate Social and Environmental Sustainability. pp. 1–55.

Conger, M. 2012. The role of personal values in social entrepreneurship. In: Patterns in Social Entrepreneurship Research. Edward Elgar Publishing, pp. 87–109.

Hockerts, K. & Wüstenhagen, R. 2010. Greening Goliaths versus emerging Davids — Theorizing about the role of incumbents and new entrants in sustainable entrepreneurship. Journal of Business Venturing. (25)5,. pp. 481–492.

Hoessle, U. 2013. Ten Steps Towards a Sustainable Business.

Klarin, T. 2018. The Concept of Sustainable Development: From its Beginning to the Contemporary Issues. Zagreb International Review of Economics and Business. (21)1,. pp. 67–94.

Koe, W.-L., Omar, R. & Sa’ari, J.R. 2015. Factors Influencing Propensity to Sustainable Entrepreneurship of SMEs in Malaysia. Procedia - Social and Behavioral Sciences. (172). pp. 570–577.

Kuckertz, A. & Wagner, M. 2010. The influence of sustainability orientation on entrepreneurial intentions - Investigating the role of business experience. Journal of Business Venturing. (25)5,. pp. 524–539.

Laukkanen, M. & Patala, S. 2014. Analysing Barriers To Sustainable Business Model Innovations: Innovation Systems Approach. International Journal of Innovation Management. (18)06,. pp. 1440010.

Mujahid, N. & Noman, M. 2018. The Impact of SMEs on the Economic Development of Pakistan. SSRN Electronic Journal.

Mukherjee, A., Kamarulzaman, N.H., Vijayan, G. & Vaiappuri, S.K.N. 2016. Sustainability. In: pp. 248–268.

Patzelt, H. & Shepherd, D.A. 2011. Recognizing Opportunities for Sustainable Development. Entrepreneurship Theory and Practice. (35)4,. pp. 631–652.

Pinkse, J. & Groot, K. 2015. Sustainable Entrepreneurship and Corporate Political Activity: Overcoming Market Barriers in the Clean Energy Sector. Entrepreneurship Theory and Practice. (39)3,. pp. 633–654.

van Praag, C.M. & Versloot, P.H. 2007. What is the value of entrepreneurship? A review of recent research. Small Business Economics. (29)4,. pp. 351–382.

Richomme-Huet, K. & de Freyman, J. 2014. What Sustainable Entrepreneurship Looks Like: An Exploratory Study from a Student Perspective. In: pp. 155–177.

Salem, A.A.H., Anderson, R. & Dana, L.P. 2012. Entrepreneurship and Sustainability. In: Handbook of Sustainability Management. WORLD SCIENTIFIC, pp. 291–312.

Shane, S. & Venkataraman, S. 2000. The promise of entrepreneurship as a field of research. Academy of Management Review.

Stevens, N.M. and R. 2010. Nathalie Moray and Robin Stevens.

Vasja Roblek, van Erenda & Meško, M. 2018. Managerial Strategies for Business Sustainability During Turbulent Times. Advances in Business Strategy and Competitive Advantage. R.-D. Leon (ed.). IGI Global.

Wach, K. 2014. Market entry modes for international businesses. In: pp. 135–147.

Zahra, S.A., Filatotchev, I. & Wright, M. 2009. How do threshold firms sustain corporate entrepreneurship? The role of boards and absorptive capacity. Journal of business venturing. (24)3,. pp. 248–260.