The Role of Entrepreneurial Orientation in Driving Environmental, Economic, and Social Sustainability: The case of Sebeta and surroundings smallholder farmers
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Date
2026-02-03
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A.A.U
Abstract
The purpose of this study was to examine the role of entrepreneurial orientation in ensuring the
three sustainability dimensions namely, economic, environmental, and social. Moreover, the
study is made among smallholder farmers in Sebeta region and its surroundings. Specifically,
the research investigated the mediating effects of strategic innovation and stakeholder
integration, as well as the moderating roles of market uncertainty and strategic innovation–
stakeholder integration interactions. A structured questionnaire was administered to 384
smallholder farmers, yielding a 72.4% response rate. Data were analyzed using SPSS version 25
and Hayes’ PROCESS macro (Models 1 and 4) to test moderation and mediation effects
respectively. The findings revealed that entrepreneurial orientation significantly improves
economic sustainability, partially mediated by strategic innovation, indicating that innovation
serves as a key mechanism for enhancing economic performance. Market uncertainty was found
to positively moderate the relationship between EO and environmental sustainability, suggesting
that EO becomes more effective in promoting environmentally sustainable practices under
uncertain market conditions. Furthermore, stakeholder integration partially mediated the
relationship between EO and social sustainability, demonstrating that active stakeholder
engagement enhances social outcomes. Based on these findings, the study concludes that
strengthening entrepreneurial capabilities, innovation adoption, stakeholder collaboration, and
farmers’ capacity to navigate market uncertainty can significantly improve the long-term
sustainability of smallholder farming systems. The study contributes to the literature by
providing empirical evidence on the mechanisms through which entrepreneurial orientation
drives multidimensional sustainability in agriculture, while recommending that future research
incorporate additional mediating and moderating variables to further enrich understanding.
Keywords: Entrepreneurial Orientation, Strategic innovation, Stakeholder integration, Market
uncertainty, sustainability, Smallholder farmers.