Abstract:

With the proliferation of small businesses in the South African construction industry as fuelled by the black economic empowerment initiative, competition has increased significantly. As a result, construction businesses, especially smaller ones, face the pressure to improve their performance, which increases their chances of survival and success in this highly competitive industry. This study proposes and tests a conceptual framework for improving environmental and business performance in the South African construction industry. Specifically, the study examined relationships existing between social responsibility, green purchasing, environmental and business performance using data collected from SMEs operating in the construction industry. A quantitative approach using the cross-sectional survey design was applied in which data were collected from a convenience sample consisting of 213 respondents drawn from SMEs based in Gauteng Province. A structural equation modelling approach using SMART PLS 3 software was applied to test the formulated hypotheses. In the results of the study, social responsibility emerged as a driver for green purchasing and environmental performance. The purchase of green products leads to improvements in environmental performance. In turn, environmental performance was positively linked to business performance. However, there were no direct relationships between business performance and two predictor constructs, namely social responsibility and green purchasing. The study confirms the importance of social responsibility and green purchasing as antecedents of environmental and business performance in the construction industry. The study also confirms the mediating role of environmental performance on the relationship between business performance, social responsibility and green purchasing. To overcome the prevailing competition and succeed in their dynamic industry, construction SMEs could identify and create specific interventions for improving these two individual predictor factors.  

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