Assessment of the Challenges of Micro and Small Scale Enterprises to Contribute to Sustainable Development: the Case of Manufacturing Enterprises in Addis Ababa, Ethiopia

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Addis Ababa University


The objective of this research is to assess the contribution of MSEs to sustainable development taking the case of manufacturing MSEs in Addis Ababa, Ethiopia. The main research question was to find the socio-economic and environmental impact of MSEs and the drivers and barriers for sustainable business practices. An exploratory research method was used to address the research questions. The research was based on review of relevant literatures and mixed method research methodology was employed where data was collected from entrepreneurs and employees of the enterprises and key informant interview was conducted with relevant officials. GRI sustainability reporting framework was used to provide the conceptual framework. This study reveals that the enterprises have created job opportunity for local dwellers and are playing considerable role in the interactions in the local markets through the use of local raw materials and serving the local customers needs. However the firms contribution to sustainable development are restrained by many factors including weak economic performance of firms, business constraints as marketing problems, input constraints and finance constraints, non effective human capital management, weak environment protection measures adopted by the MSEs and lack of relevant knowledge. Though the MSEs entrepreneurs have positive attitude on the benefits from sustainable business practices as cost reduction, profit maximization, attraction of employees and customers, reputation building and comply to legislation, the drivers are not highly influential for the enterprises due to the barriers that strongly hinder the enterprises to implement socially and environmentally responsible business practices. Key terms: Sustainable Development; MSE; Manufacturing Enterprises; Triple Bottom Line; Natural Environment; Marketing; Ethiopia



Sustainable development, MSE, Manufacturing enterprises, Triple bottom line, Natural environment, Marketing, Ethiopia