Green Economy as a Driver of Corporate Social Responsibility: Opportunities and Challenges for MSEs

Abstract

This research addresses the difference between the green economy and corporate social responsibility (CSR), focusing on micro, small, and medium-sized enterprises (MSEs) that produce textiles such as fabrics, clothing, footwear, and services in eastern Lima, Peru. In a global scenario where sustainability has become an essential pillar of economic, social, and environmental development, it is essential to understand how green economy concepts can be incorporated into local business activities. Given the significant role of MSEs in the national economy and their impact on employment and the social fabric, these companies face the challenge of balancing economic growth with responsible and sustainable practices. This study begins with a central question: how can sustainable economic practices promote CSR in this business sector? Using a quantitative approach, the study analyzes how the green economy acts as a driver of CSR in MSEs, as well as the degree of connection between the green economy and the implementation of social responsibility policies and actions in these companies. The results indicate a strong relationship between the two concepts (R² = 0.91), suggesting that the green economy may be an important factor in promoting social and environmental commitment within these organizations. In conclusion, the green economy represents a strategic opportunity to strengthen CSR in MSMEs, providing economic, social, and environmental benefits, although it also entails challenges related to resources, knowledge, and organizational adaptation. This integration could be crucial for sustainable development at both the local and national levels.

1. Introduction

The green economy has become a driving force of transformation in the global context, driving the transition to more sustainable and environmentally friendly economic models (Florin-Alexandru et al., 2018; D’Amato & Korhonen, 2021). Parallel to this transformation, the creation of green jobs helps protect and restore the environment. Furthermore, these jobs must be carried out under decent conditions that guarantee adequate remuneration, safe working conditions, and opportunities for professional advancement (OIT, 2015). This paradigm has redefined expectations around business management and made corporate social responsibility (CSR) a central pillar of business strategy. In this global environment, we examine how micro, small, and medium-sized enterprises (MSEs) can take advantage of opportunities and overcome challenges at the intersection of the green economy and CSR (Hoyos et al., 2022). The government has an obligation to promote green economic growth that generates social, environmental, and educational impacts on SMEs.

Considering the specific context of MSEs, we find ourselves in a scenario in which the adoption of sustainable practices can make a difference not only for the environment but also in terms of the competitiveness and survival of companies (Fairlie, 2017). In the green economy, companies develop proposals on relevant economic policies to achieve sustainable development. These companies, often established in local communities, play a fundamental role in job creation and the socioeconomic fabric (Cherepovitsyn et al., 2023). Therefore, it is strategically important to understand how the green economy can be a catalyst for improving CSR in organizational culture (Villa et al., 2021; Elshaer et al., 2024). Integrating the green economy and CSR into corporate culture requires a strong commitment from senior management at all levels of an organization. Leaders must demonstrate and communicate this commitment by emphasizing its importance to the company’s strategy and mission.

Furthermore, the green economy not only improves resource efficiency and reduces environmental impact but also encourages ethical and transparent management activities. In line with CSR principles, the green diamond theory acts as a strategic model that interrelates sustainable innovation, competitiveness, social responsibility, and regional development (Hanaysha et al., 2025). This approach allows SMEs to define opportunities to create shared values and improve organizational culture to regulate the integration of social well-being and environmental sustainability as the basic pillars of management. Thus, the green diamond is an important tool for improving CSR, facilitating companies’ adaptation to new economic and environmental challenges, and actively contributing to the Sustainable Development Goals (SDGs).

The main objective of this study was to explore, in depth, the intersection between the green economy and CSR, with a particular focus on the opportunities presented to MSEs. By analyzing the challenges hindering the transition to more sustainable practices, valuable insights will enrich academic knowledge and provide practical guidance to MSEs and stakeholders to promote sustainable business approaches.

This research is important because it contributes to the development of business strategies more aligned with the principles of the green economy, benefiting both MSEs and society as a whole. By filling this gap in current understanding, this research plays an important role in promoting CSR as an integral part of business management in a world where sustainability is increasingly emphasized.

2. Background to the Study of Green Economy and Corporate Social Responsibility

A study by (Varga et al., 2024) analyzes the application of the green economy on the north coast of Peru, a region with economic growth in sectors such as agriculture, mining, and tourism. Using a bibliographic and descriptive approach, the study shows that the green economy is effective in areas such as energy, agribusiness, and ecotourism, although it faces challenges such as resource exploitation and inequality. They conclude that Peru, due to its biological and cultural diversity, has great potential to implement green economy practices that balance economic development with CSR. Faustino et al. (2023) point out that, given the need to reduce greenhouse gases, it is essential for companies with CSR2 to invest in the green economy, since the brown economy does not allow for sustainable development. In the case of Peru, the importance of mining is highlighted not only for its economic benefits but also for its environmental potential, especially through the extraction of critical minerals such as lithium, cobalt, nickel, silver, and tungsten, which are essential for clean technologies. The objective of this article was to analyze the role of mining as a driver of the green economy. This transition not only fosters more sustainable economic growth but also drives job creation in green sectors (Terrazas & Terrazas, 2021). CSR in the Peruvian economy must be adopted as a management model focused on environmental and human well-being. The objective of this research is to analyze theoretical studies on the increase in CSR in Latin America since 2016, using databases of indexed journals. Papers with expert participation were selected, excluding those that did not meet this criterion. A lack of information on CSR measurement in many countries was evident. Furthermore, there are no clear international standards for its conceptualization. It is concluded that CSR management is crucial for environmental protection because it encourages companies to reduce their environmental impact through sustainable practices, regulatory compliance, and responsible use of resources, thereby contributing to the protection of the planet.

3. Literature Review

This work stems from the need to understand the green economy as a fundamental strategy to address the environmental, social, and economic challenges of the 21st century, especially in the context of SMEs, which represent a key pillar of the global economy. It is justified by the urgency of adopting sustainable models that integrate technological innovations capable of transforming production processes toward greater ecological efficiency. It also explores trends and projections that allow us to anticipate the evolution of the green economy in the coming decades, providing tools for long-term planning. It also recognizes the central role of citizen participation and civil society in promoting an inclusive and just transition. Finally, it analyzes the diamond theory applied to the green economy within the framework of corporate social responsibility as a strategic approach to strengthening business competitiveness and sustainability. The overall purpose is to offer a comprehensive vision that contributes to reflection and action regarding more equitable and environmentally friendly development.

3.1. Green Economy

The green economy is one of the global strategies used to address modern society’s economic and environmental crises. In the early years of economics as a science, except for the first work of the French physiocrats (1758), economists showed no interest in the relationship between the economy and nature. However, in the 1970s, this relationship became relevant again with the publication of the Club of Rome report, which started a “pessimistic” trend by pointing out the existence of biophysical limits to growth (Meadows et al., 1972). An optimistic current soon emerged, marked by the belief that technology and markets could quickly resolve the conflict between economics and nature, and led to the discovery of the collection of essays, A Response to Global 2000 Report (Simon & Kahn, 1984). The “possibilist” movement aims to integrate economic models that allow economic growth compatible with sufficient conservation of nature to guarantee an adequate standard of living in the future (Tolkachev et al., 2023). The concept of harmonious development of economy and society is important for its concept of sustainable development, which ignores the short-term profits of enterprises and strives for greater profits in the future. The 1987 Brundtland Report, which popularized the concept of sustainable development, framed the “possibilist” trend and proposed the idea of a green economy in this context.

Peru implements policies and projects linked to the green economy, given that it can benefit from its remarkable biological and cultural diversity, which places it among the seven most megadiverse countries in the world (Varga et al., 2024). Considering its geographic location, it has established itself as an ideal region for promoting the green economy and being a predictor of CSR thanks to its extensive biodiversity; however, anthropogenic environmental problems persist, threatening the balance of ecosystems.

Etymologically, (Chaban-Garcia & Hidalgo-Capitan, 2023) define the green economy as an economic model to improve human well-being and social justice, reduce carbon emissions, increase income, create jobs, promote energy efficiency and resource use, and stop the loss of biological diversity and ecosystem services (Batista et al., 2021). From this perspective, a green business must offer high value to consumers. It must also evoke an emotional response in consumers, which presupposes brand credibility or its ability to deliver the promised benefits. Most importantly, environmentally friendly principles must be embedded in all areas of a company’s existence and activities (Alexandrova et al., 2020). The economic activities of companies are causing enormous damage to the environment, giving rise to the concept of sustainable development and strict requirements for environmental protection, which link all economic issues and relationships with corporate social responsibility (Programa de las Naciones Unidas para el Medio Ambiente & Oficina Regional para América Latina y el Caribe, 2012) The green economy improves human well-being and social equity while significantly reducing environmental risks and ecological obstacles. It is low-carbon, resource-efficient, and socially inclusive (Dominguez et al., 2020). Furthermore, the transition to a green economy differs in each country because it depends on the specific configuration of natural capital (i.e., extending the economic concept of capital to environmental goods and services). Natural resources such as forests, lakes, wetlands, and river basins are important parts of natural capital at the ecosystem level and their relative level of development (Campos, 2010). In 21st-century business development and corporate social responsibility, it is crucial to examine the strategies and methodologies employed by leading organizations focused on renewable natural resources, such as the efficient use of fossil fuels, water, land, and vegetation essential for the lives of all species.

Fagerland and Bleveans (2025) state that climate change is one of the most significant global challenges of the 21st century, associated with pollution, deforestation, declining biodiversity, and natural disasters. It is among the twenty-three most significant global problems and the ten most pressing dangers for humanity. The inability to mitigate and adapt to climate change is highlighted, in addition to the increase in extreme weather events such as floods, storms, and droughts. In this scenario, CSR takes on an essential role, as it promotes sustainability practices in companies and helps reduce their impact on climate change.

In Mexico, there are manufacturing sectors that generate high levels of pollution, such as petrochemicals, chemicals, paper, petroleum, and base metals, among others. In fact, this sector represents one of the economic activities with the highest costs due to the depletion of natural resources and the deterioration of the natural environment. Faced with these challenges, numerous companies in Mexico have begun to adopt more sustainable practices, such as the application of green technologies, energy efficiency, recycling materials, and the implementation of environmental management systems. Furthermore, through Corporate Social Responsibility, entities are incorporating policies to reduce their ecological impact and contribute to safeguarding the environment (Ebisi et al., 2025).

3.1.1. The Green Economy: Opportunities and Challenges for MSEs in the 21st Century

The green economy is the primary driver of business development in the 21st century and presents the following opportunities and challenges for MSEs:

Opportunities

• Sustainable growth

The green economy offers opportunities to develop businesses aligned with sustainable practices, attract conscious consumers, and gain a competitive advantage (Arbolino et al., 2018). Sustainable development includes three dimensions: environmental value, related to the use of renewable resources, low emissions, waste reduction, and pollution prevention (air, water, and soil); social value, which emphasizes equality, diversity, workplace well-being, health, and safety; and economic value, characterized by the earnings, financial return on capital, and long-term profitability of a company.

2.

Innovation in the field of renewable energy

MSEs can capitalize on the boom in renewable energy by exploring opportunities for producing and deploying clean technologies (Ibarra, 2018). Changes due to increasing greenhouse gas emissions from human activities are a major global problem of the 21st century. Furthermore, its environmental consequences and rising temperatures are calling production and consumption models into question, with economic, political, and social implications in industrialized and transitional countries.

3.

Energy efficiency

Process optimization and efficient technologies can reduce costs and improve sustainability, which presents opportunities for MSEs (Zhovkva, 2020). The goal of energy efficiency is to reduce the use of energy that has a negative impact on the environment.

In summary, the green economy offers strategic opportunities for MSEs to thrive in the 21st century, but they will face financial and operational challenges in adopting sustainable practices. Investing in innovation and proactively adapting to environmental standards is the key to success in this new business paradigm.

Challenges

• Initial investment

Practical green business transition often requires significant investments in sustainable technologies, which can be financially challenging for MSEs (Lamis et al., 2020). The production of technological goods and services currently accounts for around 6.5% of GDP, and the ICT services sector employs around 100 million. This has a significant influence on the productive dynamics of companies.

2.

Adapt to environmental standards

Complying with environmental regulations and standards can take time for MSEs, as it may involve changes in production and supply chains.

3.

Awareness and education

Lack of knowledge about sustainable practices can be a barrier; MSEs must educate their employees and customers about the benefits of a green economy (Muñoz et al., 2019). Employee education and training are necessary to develop each employee’s knowledge and skills according to the job’s characteristics and achieve more effective performance.

The Future of the Green Economy

The future of the green economy is shaped by technological innovations, trends, and projections; perspectives on how the green economy will evolve in the coming decades and on citizen participation; and the role of citizens and civil society in the transition toward a green economy.

3.1.2. Technological Innovations

Technological innovations play a key role in the transition towards a green economy. According to Prez and Moreno (2018), companies that dedicate a portion of their resources to technological innovation processes know they run a high risk because this is directly proportional to the investment cost and success in the green market. These technologies help minimize negative environmental impacts and promote a more efficient and sustainable use of resources through knowledge management. In this regard, Huamani et al. (2024) point out that knowledge management is a relevant driver of innovation, as it facilitates collaboration between employees, captures lessons learned, and generates new ideas for implementing the green economy. It highlights emerging technologies and their potential impact: advanced renewable energy, energy storage, sustainable transport, precision agriculture, and circular economy. They point to advances in renewable energy sources, such as perovskite solar cells and floating wind turbines, which improve efficiency and reduce costs; improved energy storage with lithium-ion and redox flow batteries, which stabilize the electrical grid; and sustainable transportation using electric vehicles and hydrogen charging infrastructure. Furthermore, precision agriculture uses drones, IoT sensors, and big data to optimize resources, while the circular economy thrives on recycling and biodegradable materials. Finally, carbon capture and storage (CCS) technology is key to reducing industrial CO₂ emissions.

3.1.3. Trends and Projections: Perspectives on How the Green Economy Will Evolve in the Coming Decades

Several trends and forecasts indicate significant changes in the global economy’s performance, which determines the future of the green economy. Some key trends include the following: green market growth is expected to be driven by conscious government and consumer policies and decarbonization of the economy, which will create the conditions for a major transition to renewable energy and low-carbon technologies. Indeed, according to Sidorenko (2023), the main task in the coming years is to modernize electricity transmission networks to be more flexible, secure, and sustainable and based primarily on renewable energy. Green financing in the form of bonds (Arellano & Pérez, 2022), green bonds (in which the funds raised are directed exclusively to investing in projects that benefit the environment or stop its deterioration), and sustainable funding will be key, while sustainable urbanization will require cities with green infrastructure, efficient public transport, and smart buildings. Castro (2016) highlights the growing global concern about the importance of the environment, and climate change has led to the creation of international funds and programs focused on mitigation and adaptation. These resources offer benefits and support to projects and countries that develop actions for conserving natural capital. The effective management of natural resources will be critical, supported by advanced technology and sustainable practices, and governments will adopt stronger policies to control pollution and promote sustainable development, including carbon taxes and energy efficiency regulations.

3.1.4. Citizen Participation: The Role of Citizens and Civil Society in the Transition Toward a Green Economy

The transition to a green economy cannot be achieved through technological innovation and government policy alone. It requires the participation of civil society and individuals. In this sense, Conte Grand (2018) considers that society must be part of a new growth economy consistent with social and environmental sustainability, demanding goods from producers.

People can live sustainably by using less plastic and more plant-based plastic, responsibly consuming organic products, educating and raising awareness about sustainable habits, participating in public policies and environmental movements, engaging in community efforts such as urban gardens and recycling methods, promoting sustainable development in food and public transport, and cooperating with NGOs (Helfaya & Bui, 2025). The economy and the environment have reached a high degree of interaction (Gudynas, 2011; Haidar & Berros, 2015) thanks to the growing social and environmental awareness and considering the damage that productive activities cause to the natural environment. Many of these activities lead to processes of contamination of water, air, soil, and biodiversity resources, directly affecting social dynamics (Bittencourt et al., 2012; Díaz, 2016). This awareness allows people to look for more sustainable and environmentally responsible alternatives (Law et al., 2016).

3.1.5. Diamond Theory of Green Economy in Corporate Social Responsibility

Based on the concepts presented in the review of the literature on the green economy and after a detailed study of primary sources, the diamond theory of the green economy is proposed within the framework of CSR. The researchers develop and adopt this theory as a new theoretical framework in the field.

The green economy diamond is a conceptual model that provides companies with a framework for integrating environmental sustainability into their CSR strategies, providing companies with a structured framework for integrating sustainability into their CSR. By focusing on technological innovation, regulation, consumer demand, and sustainable financing, companies can improve their environmental impact, strengthen their market position, enhance their reputation, and improve their long-term sustainability. This approach benefits the company and contributes to the well-being of society and the planet. It is consistent with global business development objectives.

Within the framework of green economy theory, this model not only promotes efficient resource use and the reduction of negative impacts but also fosters economic growth that respects natural capital. Incorporating these concepts into CSR involves more than simply complying with regulations or carrying out isolated philanthropic initiatives; it involves transforming business models toward development that is sustainable, inclusive, and regenerative.

In this way, the green economy diamond not only helps boost companies’ competitiveness and corporate image but also aligns business activities with the Sustainable Development Goals (SDGs) and other global frameworks focused on sustainability. This comprehensive approach benefits companies by allowing them to anticipate emerging risks and opportunities, as well as society as a whole by fostering a more equitable, resilient, and environmentally friendly economy. The green economy diamond encompasses the following:

• Technological innovation:

This is the development and application of technologies that reduce environmental impact, such as energy efficiency, renewable energy, and environmentally friendly products. Companies that invest in these technologies reduce operating costs, improve their efficiency, and decrease their carbon footprint, demonstrating their commitment to sustainability and improving their reputation. According to Licandro et al. (2024), the significant number of MSMEs in Latin America makes it essential to recognize the variations in how R&D activities are carried out depending on the company’s size. Large companies, due to their superior financial, organizational, and technological capacity, tend to carry out R&D more frequently and systematically. On the other hand, MSMEs face greater obstacles to carrying out these types of activities due to limitations in resources, access to financing, specialized personnel, and management (Bergset, 2015). This means that in some cases, CSR is not seriously applied or is not a more effective way of promoting a green economy. Thus, climate change and new technologies are fostering greener business strategies. Companies are incorporating sophisticated studies to assess sustainability, adapting to regulations such as carbon taxes, and opting for green technologies to adapt to the regulatory and competitive environment.

2.

Environmental regulations and policies are an essential aspect of the green economy in the CSR strategy:

Regulations include laws, rules, and international agreements that promote environmentally sustainable business practices and penalize environmental damage. This paper analyses the impact of environmental regulations and policies on CSR and the benefits companies can obtain from complying with these regulations.

3.

Consumer awareness and demand:

These are essential components of the green economy diamond and play a crucial role in a company’s commitment to CSR. Companies can use these trends to improve their sustainability and competitiveness by developing sustainable products and services, communicating transparently, educating and engaging consumers, and collaborating with other stakeholders. The company’s ability to meet consumer demands for responsible business practices benefits the company, the environment, and society.

4.

Sustainable financing:

Financing the green economy diamond requires the resources needed for companies to implement and scale their sustainability initiatives. Leveraging green bonds, responsible investment funds, sustainability-based loans, and sustainable venture capital can help companies finance green projects, reduce financing costs, improve their reputation, and promote innovation. This approach benefits the company and significantly impacts the environment and society, supporting global sustainable development goals.

According to Stein and Wagner (2019), Latin America and the Caribbean are clearly among the regions where venture capital investments are growing most rapidly, along with sub-Saharan Africa. In Latin America and the Caribbean, the value of venture capital investments grew at an annual rate of 31.2%, well above the 9.7% in East Asia and the Pacific (including China) and the 7.6% per year in South Asia, including India. Over this period, levels in developed regions remained virtually constant, if measured according to the log-linear trend (0.5% annual growth in industrialized countries, excluding the United States, and a 0.1% decline in that country). China and India tend to invest more than other countries in general, not just in venture capital investments. For example, gross fixed capital formation stood at around 21% of GDP in the Latin American economies in the sample. The investment rate in China was double, reaching almost 45% of GDP, while in India, the rate was somewhere in between, around 33% of GDP. This shows that overall, there is a difference in investment, but the tenfold difference in the venture capital-to-GDP ratio detected is significant.

From the above, it can be inferred that Porter’s Diamond theory, as it relates to venture capital, describes how an enabling national environment can incentivize the implementation of green technologies in SMEs. Venture capital functions as a structural enabler, optimizing factor conditions, boosting demand, establishing connections with supporting industries, and promoting sustainable competition, thereby driving green economy innovation. It contributes to understanding how favorable or adverse circumstances are created for SMEs to incorporate sustainable technologies into their processes and business models.

3.2. Corporate Social Responsibility

Corporate social responsibility (CSR) is a term that has been around since the 1920s, with previous mention of concepts such as corporate philanthropy and codes of conduct (Tandoh et al., 2022). Although CSR was not widely adopted in large companies until the 1950s due to the Great Depression and World War II (Carroll & Habana, 2010), it gained prominence in 1951 with the introduction of Frank W. Abrams’ accountability proposal (Ashrafi et al., 2020). CSR has evolved from a social/philanthropic approach to a holistic perspective of social, environmental, and economic responsibility (Ashrafi et al., 2018). CSR is known to impact corporate image positively, both internally and externally, and is widely adopted as a business strategy to improve corporate reputation (Arrive et al., 2019).

Etymologically, CSR (Barroso, 2008) refers to a company’s active and voluntary contribution to improving society, the economy, and the environment. This management concept includes a set of practices, strategies, and business management systems that seek a new balance between the economic, social, and environmental dimensions. This can be understood as companies that voluntarily integrate social and environmental issues into their business activities and interlocutors (Guadalupe et al., 2023). It is a business approach that means that companies take responsibility for the impact of their activities on society, the environment, and all stakeholders involved in their economic activities. It also ”means the moral and ethical responsibility of the company towards the employees, the environment, competitors, and the economy that produces goods and services, considering all parties’ well-being.” (Villegas, 2007) and seeks to ensure that corporate companies promote responsible and transparent practices that contribute to sustainable growth, social justice, and environmental awareness through transparent means (Mendoza et al., 2020). The programs and projects that responsible companies implement are designed to address social issues, such as poverty, education, gender equality, health, and environmental protection.

Economic, Social, and Environmental Impact of the CSR of MSEs

The CSR of SMEs significantly impacts various economic, social, and environmental aspects in the following ways:

• Economic:

MSEs that adopt CSR approaches experience long-term economic benefits, including increased customer retention, improved business reputation, access to new markets, operational efficiency, cost reduction, and strengthened business relationships (Lopes de Oliveira & Moneva, 2013). A company’s economic performance positively impacts an organization’s social, environmental, and economic performance.

2.

Social:

The implementation of CSR in MSEs promotes fair labor practices, training programs, and safe environments for the community and employees. In addition, social relations are strengthened through philanthropic contributions, social initiatives, and the promotion of diversity that reinforces social ties (Vergara-Romerto et al., 2020). Corporate social commitment is increasingly the subject of business decisions based on the ethics of good practices. Furthermore, Cha et al. (2019) believe the impacts also include increases in employee job satisfaction, organizational commitment, organizational identification, and lower intention to quit.

3.

Environmental:

MSEs’ adoption of environmentally sustainable practices protects the environment by reducing environmental impacts, promoting clean technologies, efficiently managing waste, and helping to conserve natural resources.

4. Methodology

Due to this study’s characteristics, it is framed as descriptive and quantitative research to understand the relationship between the green economy and CSR in MSEs. A quantitative approach was used to view the associated opportunities and challenges comprehensively. The target population includes MSEs involved in economic activities related to the green economy. Companies from various sectors were selected based on their participation in sustainable practices. The sample was selected through intentional non-probabilistic sampling, prioritizing the representation of different sectors and dimensions of MSEs. The survey was conducted in 2024, and the sample was selected through deliberate non-probability sampling, prioritizing representation from diverse sectors and dimensions of SMEs. In other words, the sample was selected through deliberate non-probability sampling based on previously established criteria, which ensured a diverse representation of SMEs according to economic sector, company size, age, and turnover. Although this method does not allow for generalizable statistical conclusions, it is appropriate for quantitative and exploratory research that values the variety and abundance of information in the cases. Theoretical saturation criteria were used to establish the adequacy of the sample, and an approximate balance between the different profiles chosen was sought, thus reducing representation bias.

Inclusion criteria were established based on adopting green economy and CSR practices. Those MSEs that did not meet the inclusion criteria and those unwilling to participate in the study were excluded from the sample.

A quantitative design was applied to obtain information using a structured survey of 350 owners and managers (survey title, survey objective, expected response time, confidentiality, and difficulties in responding) of MSEs, who were interviewed with their prior consent between March and April (2024), to understand their opportunities, experiences, and challenges regarding the green economy and CSR. The measurement instrument was administered through Google Forms software, and its link was distributed in a training program on green economy and CSR, which was provided for this purpose. Links to the studied samples were shared virtually through emails and social networks. The researchers directly answered questions about completing the instrument by visiting the respondents’ companies. Furthermore, information was collected from articles registered in scientific databases such as Scopus and published in the highest quartiles (Q1, Q2, Q3, and Q4), which provided scientific information for the research. To achieve this, information was compiled using journal names, keywords, Boolean operators, and the Scimago Journal Rank (SJR).

The tool used for the green economy was a survey questionnaire developed by the researcher based on concepts of (Chaban-Garcia & Hidalgo-Capitan, 2023; Batista et al., 2021; Dominguez et al., 2020; Campos, 2010) and validated by an economist with three years of experience in green economy work. It included 16 Likert-type items with 5 response choices, where 1 means strongly disagree and 5 means strongly agree, evaluating MSEs’ level of knowledge on, and adoption and perception of, the green economy and CSR. The data collection processing was compiled in a structured and ethical manner, ensuring the reliability of the information. Cronbach’s alpha was 0.89. For the CSR variable, the instrument of (Alvarado et al., 2019) includes 12 items and uses a 5-point Likert-type scale, where 1 represents “strongly disagree” and 5 represents “strongly agree”. Cronbach’s alpha for the reliability of this instrument is 0.91. These dimensions balance operational efficiency, environmental sustainability, and social responsibility, which is relevant for MSEs seeking to integrate green economy practices into their operations.

The study’s limitations fall into four main categories: methodological, contextual, scope, and availability of information. The study maintains a formal style consistent with the work’s theme.

4.1. Methodological Limitations

The quantitative nature of the study includes the use of qualitative methods, such as semi-structured interviews, surveys, and documentary analysis. While these tools allow for capturing relevant perceptions and experiences, they also carry risks of bias in data collection and interpretation. Furthermore, the subjectivity associated with the interviewees’ responses may limit the objectivity of the analysis. In the case of quantitative techniques, they cannot fully reflect the complexity of the interactions between the green economy and CSR in the specific context of SMEs.

4.2. Contextual Limitations

The study was conducted within a specific economic, social, and regulatory context, which may have a significant impact on the results achieved. Factors such as current environmental legislation, government incentives, business culture, and consumer environmental awareness vary across regions. These contextual differences limit the ability to extrapolate the results from other national or international environments with different characteristics.

4.3. Scope Limitations

The study focuses only on the link between the green economy and CSR in the SME sector. While it allows for a more in-depth analysis of this business segment, it leaves out large corporations or other organizations that also play an important role in the transition to sustainable models. The study also focuses on identifying opportunities and challenges, not always evaluating the quantitative or comparative impact of specific practices, which limits its applicability to research or performance analysis.

4.4. Limitations in the Availability of Information

One of the biggest challenges in studies related to CSR in SMEs is the lack of systematized data. Many of these companies do not have structured reports on their environmental or social practices, which impedes access to accurate, up-to-date, and verified information. Furthermore, SMEs may, in some cases, ignore the concept of the green economy or interpret CSR in a limited way, which can affect the quality of the information collected.

This methodology seeks to provide a comprehensive understanding of how the green economy can drive CSR in MSEs, identifying opportunities and challenges that may arise in this context.

5. Results

5.1. Normality Analysis

In

Table 1. Analysis of adjustment to the normal curve of the study variables.

Variables	Mean	Std. Dev.	Skewness	Kurtosis
Green economy	49.67	20.08	−0.45	−1.25
Energy efficiency	12.22	5.09	−0.35	−1.27
Sustainable waste management	12.56	5.15	−0.47	−1.17
Circular economy	12.44	5.24	−0.39	−1.29
Socially responsible investments	12.44	5.23	−0.37	−1.28
Corporate Social Responsibility	36.25	14.93	−0.36	−1.3
Community	8.98	3.81	−0.27	−1.29
Employees	8.99	3.9	−0.29	−1.32
Atmosphere	9.18	3.85	−0.37	−1.28
Status	9.1	3.91	−0.34	−1.31

, the asymmetry and kurtosis scores of the variables are within the acceptable range of ±2, which suggests that the data’s distribution follows a normal shape. These results support the use of parametric tests in the statistical analyses, providing a solid basis for interpreting the results.

5.2. Correlation Analysis

In

Table 2. Correlation analysis between green economy and corporate social responsibility.

	Corporate Social Responsibility		Community		Employees		Atmosphere		Status
	R	p	R	p	R	p	R	p	R	p
Green economy	0.91	0.000	0.89	0.000	0.87	0.000	0.87	0.000	0.87	0.000
Energy efficiency	0.87	0.000	0.87	0.000	0.83	0.000	0.84	0.000	0.82	0.000
Sustainable waste management	0.89	0.000	0.86	0.000	0.86	0.000	0.86	0.000	0.86	0.000
Circular economy	0.88	0.000	0.86	0.000	0.85	0.000	0.85	0.000	0.85	0.000
Socially responsible investments	0.87	0.000	0.86	0.000	0.82	0.000	0.83	0.000	0.84	0.000

, a highly significant, positive, and very strong correlation is evident (R = 0.91, p < 0.001) between the green economy and CSR; in the same way, highly significant, positive, and very strong correlations are observed between the dimensions of energy efficiency and CSR (R = 0.87; p < 0.001), energy efficiency and community (R = 0.87; p < 0.001), energy efficiency and employees (R = 0.83; p < 0.001), energy efficiency and environment (R = 0.84; p < 0.001), and energy efficiency and status (R = 0.82; p < 0.001). Likewise, correlations are observed between the dimensions of sustainable waste management and CSR (R = 0.89; p < 0.001), sustainable waste management and community (R = 0.86; p < 0.001), sustainable waste management and employees (R = 0.86; p < 0.001), sustainable waste management and environment (R = 0.86; p < 0.001), and sustainable waste management and state (R = 0.86; p < 0.001), and similarly, between the dimensions of circular economy and CSR (R = 0.88; p < 0.001), circular economy and community (R = 0.86; p < 0.001), circular economy and employees (R = 0.85; p < 0.001), circular economy and environment (R = 0.85; p < 0.001), and circular economy and state (R = 0.85; p < 0.001). Finally, correlations are observed between the dimensions of socially responsible investments and CSR (R = 0.87; p < 0.001), socially responsible investments and community (R = 0.86; p < 0.001), socially responsible investments and employees (R = 0.82; p < 0.001) socially responsible investments and environment (R = 0.83; p < 0.001), and socially responsible investments and state (R = 0.84; p < 0.001). These findings underline the consistent and substantial connection between the green economy and the promotion of socially responsible business practices, supporting the study’s purpose of exploring the relationship between the green economy and CSR in the context of MSEs.

5.3. Principal Component Analysis

The study performed a principal component analysis of all variables related to green economy: energy efficiency (EEX1), sustainable management (GSRX2), circular economy (ECX3), responsible investments (ISRX4), community (CY1), employees (EY2), environment (AY3), and governance (EY4) to verify the integrity of the data of the factor analysis performed, measuring the adequacy of sampling for each variable of the model and for the complete picture that green economy and CSR have a KMO greater than 0.80, which confirms that the sampling is appropriate, as shown in

Table 3. Kaiser-Meyer-Olking test.

Kaiser-Meyer-Olkin	MSA
Overall MSA	0.942
Energy efficiency (X1)	0.959
Sustainable management (X2)	0.928
Circular economy (X3)	0.924
Responsible investments (X4)	0.951
Community (Y1)	0.944
Employees (Y2)	0.938
Environment (Y3)	0.936
State (Y4)	0.956

and

Table 4. Bartlett’s test.

Bartlett’s Test
χ2	df	p
13,767.026	28.000	<0.001

.

Likewise, a value of 13,767.026 was found with p < 0.001 for Bartlett’s sphericity test, which indicates that it is reasonable to consider the application of the dimension reduction technique to the study variables.

An analysis of the individual APC variables was carried out, revealing an explained variance of 89.2%. A correlation was observed between sustainable management (X2) and the community (Y1) due to the lower angle of approach; secondly, energy efficiency (X1) and personnel efficiency (Y2) are significantly correlated; and finally, responsible investment (X4) and the environment (Y3) are correlated, as shown in Figure 1.

In Figure 2, the biplot reveals that MSE owners 29, 150, 196, 66, 117, and 9 are more likely to support CSR, with a special emphasis on the environment (Y3), employees (Y2), state (Y4), and community (Y1), while other SME owners, 36, 214, 197, 95, 43, and 190, have a lower commitment to sustainable management (X2), energy efficiency (X1), circular economy (X3), and responsible investments (X4). The circular economy, which promotes a green and sustainable economy, is frequently developed by MSE owners 185, 43, 190, and 35.

Figure 3 shows three distinct clusters based on a PCA dimension reduction analysis, where the first dimension explains 89.2% of the variance and the second dimension explains 4.5%. This means that almost 94% of the information is contained in these two dimensions, which is excellent for visual interpretation. The three clusters are perceived as distinctive profiles among MSEs, according to their CSR orientation: in the first cluster (blue), there are proactive MSEs in CSR, located on the right side of the graph (high values in Dim1), with the highest scores in energy efficiency, sustainable management, and circular economy, as well as in community, employees, environment, and state. This implies that these companies incorporate CSR strategies in a balanced way. They are leaders or forerunners in implementing the green economy as a fundamental pillar. Cluster 2 (grey) includes lagging or traditional SMEs, located on the left; low values in dimension 1 indicate that these companies have not yet actively incorporated green economy or CSR practices, which could lead to obstacles such as lack of financing, lack of knowledge, or lack of incentives. In cluster 3 (yellow), partially committed SMEs are located in the central zone of the first dimension, close to zero. They show some progress in variables such as circular economy and responsible investments, but less progress in others. This implies that companies in the transition or partial adoption stage recognize the importance of these practices but are still acquiring capabilities or resources.

5.4. Confirmatory Factor Analysis

A confirmatory factor analysis of the study variables was conducted to examine the relationship between the green economy and CSR. The goodness of fit indices shown in

Table 5. Confirmatory factor analysis.

Fit Indices	Value
Comparative Fit Index (CFI)	0.988
Tucker–Lewis Index (TLI)	0.983
Bentler–Bonett Non-normed Fit Index (NNFI)	0.983
Bentler–Bonett Normed Fit Index (NFI)	0.983
Parsimony Normed Fit Index (PNFI)	0.667
Bollen’s Relative Fit Index (RFI)	0.975
Bollen’s Incremental Fit Index (IFI)	0.988
Relative Noncentrality Index (RNI)	0.988

are very significant in the factorial model found.

The Akaike Information Criteria (AIC) and Bayesian Information Criteria (BIC), shown in

Table 6. AIC and BIC information criteria.

AIC and BIC Information	Value
Log-likelihood	−3944.598
Number of free parameters	25,000
Akaike (AIC)	7939.196
Bayesian (BIC)	8026.419
Sample-size-adjusted Bayesian (SABIC)	7947.174

, demonstrate the factor model’s good functionality.

Likewise, other adjustment measures were discovered, such as an RMSEA of 0.093 and an RMSEA p-value of 0.005, less than the significance level, indicating that the confirmatory factor model is relevant to the proposed model, as shown in

Table 7. RMSEA fit measures.

Fit Metrics	Value
Root mean square error of approximation (RMSEA)	0.093
RMSEA 90% CI lower bound	0.067
RMSEA 90% CI upper bound	0.121
RMSEA p-value	0.005
Standardized root mean square residual (SRMR)	0.011
Hoelter’s critical N (α = 0.05)	124.231
Hoelter’s critical N (α = 0.01)	148.954
Goodness of fit index	0.978
McDonald’s fit index (MFI)	0.920
Expected cross-validation index (ECVI)	0.451

.

Table 8. Factor loadings.

Factor Loadings						95% Confidence Interval
Factor	Indicator	Estimate	Std. Error	z-Value	p	Lower	Upper
Green economy	ISRX4	4.961	0.249	19.900	<0.001	4.472	5.449
	ECX3	5.089	0.244	20.866	<0.001	4.611	5.567
	EEX1	4.766	0.245	19.489	<0.001	4.287	5.245
	GSRX2	5.013	0.240	20.898	<0.001	4.543	5.483
CSR	EY4	3.668	0.188	19.508	<0.001	3.300	4.037
	AY3	3.711	0.181	20.507	<0.001	3.356	4.065
	EY2	3.731	0.184	20.267	<0.001	3.370	4.092
	CY1	3.616	0.182	19.915	<0.001	3.261	3.972

shows the estimated parameters of the green economy and CSR. It is shown that all green economy variables have p-values below the significance level and that CSR variables have values below $\alpha <0.05$; these findings confirm the reliability of the proposed factorial model.

Finally, Figure 4 shows a significant relationship between the green economy and CSR, with a correlation strength of 0.92. Furthermore, the green economy is associated with its energy efficiency component, which has a strength of 0.94; the circular economy, which has a strength of 0.97; responsible investments, which has a strength of 0.97; and sustainable management, which has a strength of 0.95. Likewise, CSR is associated with the state with a strength of 0.94, the environment with a strength of 0.97, employees with a strength of 0.96, and, finally, the community with a strength of 0.95.

6. Conclusions

This study, “Green Economy as a Driver of CSR: Opportunities and Challenges for MSEs,” presents a solid basis for understanding the interdependence between sustainable practices and CSR in MSEs. The green economy and CSR have a strong, significant correlation coefficient of R = 0.91, highlighting how green practices can improve companies’ social and environmental commitment.

However, it is crucial to clarify that a high correlation does not necessarily imply causality. In this situation, the validity of a causal analysis is limited by the nature of the sampling: the sample is composed solely of MSMEs that already practice green economy and CSR. This creates a selection bias that hinders the generalization of the results to all MSMEs and complicates the determination of a direct causal relationship. To verify the presence of causality, more robust techniques would be needed, such as longitudinal or experimental research or analyses with control groups that include companies that do not practice these practices.

The green economy, which promotes environmentalism and reduces resource use, catalyzes CSR in MSEs. This approach not only supports business practices that improve the natural environment but also has the potential to enhance companies’ reputation and competitiveness. The robustness of the model is supported by principal component analysis and a Bartlett’s test of sphericity value of 13,767.026 with p < 0.001, indicating that green economy and CSR are statistically significant and correlated constructs.

The owners’ commitment to CSR highlight the importance of leadership and business vision in promoting sustainable practices. The success of any green economy initiative depends on business leaders’ commitment to organizational culture and strategic decision-making. The confirmatory factor test, with a correlation coefficient of 0.92 and an RMSEA of 0.093, supports the validity of the proposed confirmatory factor model and its ability to explain the relationship between the green economy and CSR.

Furthermore, the study highlights MSEs’ challenges and opportunities when integrating the green economy and CSR. Opportunities include improving competitiveness, market differentiation, and access to new consumer groups that value sustainability. However, obstacles include the need for significant initial investments, adaptation to environmental regulations, and training staff to adopt new practices.

Therefore, the green economy is presented as a strategic pillar for CSR in SMEs, as it offers a viable path toward sustainable development. The adoption of responsible and green practices benefits the environment and improves the long-term resilience and sustainability of companies. By providing empirical evidence and a conceptual model that highlights the interdependence between the green economy and CSR, this study contributes to existing knowledge. In this context, the diamond theory of the green economy, which considers the interaction between public policies, innovation, business capabilities, and sustainable demand, allows us to understand how these factors mutually enhance each other to strengthen corporate social responsibility.

Therefore, the green economy is presented as a strategic pillar for CSR in MSEs, as it provides a viable route toward sustainable development. Adopting responsible and green practices benefits the environment and improves businesses’ resilience and sustainability in the long term. By providing empirical evidence and a conceptual model that highlights the interdependence between the green economy and CSR, this study contributes to the existing body of knowledge.

Two areas of study are proposed for other researchers to analyze and address future business challenges. The first is a comparative analysis of the implementation of green economy practices and their impact on CSR in SMEs across various economic sectors. The second is an analysis of the obstacles and facilitators to the joint implementation of the green economy and CSR in SMEs in developing countries.