The Relationship Between Green HRM and Environmental Performance in SMEs

Abstract

The growing focus on sustainability has put the importance of Green Human Resource Management (GHRM) in developing sustainable practices in small and medium-sized enterprises (SMEs) in a new light. This research investigates the GHRM–environmental performance (EP) relationship from the perspective of the Resource-Based View (RBV) and using the Ability–Motivation–Opportunity (AMO) framework. Findings from recent empirical studies validate that GHRM green recruitment, training, performance management, and compensation practices have a positive influence on environmental performance in SMEs. The results also suggest that this relationship was mediated by mechanisms such as green dynamics, employee environmental commitment, and green supply chain management. For example, SMEs that adopt GHRM practices realize improved energy efficiency and reduced waste, as well as improved compliance with environmental regulations. The influence of GHRM is also strengthened by green transformational leadership and employee involvement by stimulating pro-environmental behaviour. The research concludes that GHRM provides SMEs with an affordable route to improve sustainability performance and gain competitive advantage. This study reinforces the importance of human capital in promoting organizational environmental goals and contributes to the wider discussion of sustainable business practices.