What Fosters Eco-Innovation in European SMEs? A Conceptual Framework and Empirical Evidence Across Micro, Meso, and Macro-Factors

Due to the changing climate, an increasing number of organizations are focusing on Eco-Innovations (EIs). In this study, we present a currently missing conceptual framework that classifies the determinants of EI across micro-(firm), meso-(intersectoral), and macro-(policy) dimensions. Based on a comprehensive review of the literature and its existing gaps, this framework comprises three levels and six categories (financial, technical, organizational, market, collaboration, and legal) with fourteen unique drivers and ten barriers. Theoretically, the EI framework is grounded in the Porter hypothesis and social network theory. To test the framework, novel secondary data collected from almost 11,000 European SMEs was employed. The baseline results using Logit and Poisson regression were used to empirically validate the framework, and moderation analysis revealed an interplay among the three levels. In addition to financial resources and technical expertise, meso-level cooperation is one of the most relevant factors for organizational EI actions. The meso-level arguably serves as an adhesive between the micro- and macro-levels. Furthermore, due to the ambiguous and dynamic implications of the Porter hypothesis, barriers-mainly located at the macro-level-may also foster EI. Therefore, this paper provides valuable new strategic insights for organizations aiming to adopt EI.