Modelling barriers to green entrepreneurship in traditional MSMEs: Evidence from the Batik industry in Madura, Indonesia

Abstract

The global transition toward sustainable development has increased pressure on micro, small, and medium enterprises (MSMEs) to adopt environmentally responsible business practices. Although green entrepreneurship is widely promoted as a pathway to sustainability, its implementation remains challenging for traditional and culture-based enterprises. Existing studies largely emphasize performance outcomes, while empirical evidence on implementation barriers remains limited. This study examines the key barriers to green entrepreneurship implementation among batik MSMEs in Madura, Indonesia. A quantitative approach was employed using survey data collected from 200 respondents across four regencies. The data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS to assess the relationships between government policy, technology adoption, environmental education, and implementation barriers. The findings reveal that technology-related constraints constitute the most significant barrier, followed by weak regulatory support and limited environmental knowledge. High costs of green technology adoption and insufficient access to education, information, and sustainable production inputs further constrain MSMEs’ readiness to transition toward sustainable practices. This study contributes to the green entrepreneurship literature by shifting the analytical focus from sustainability outcomes to implementation barriers in traditional MSMEs and by providing a more robust empirical model using PLS-SEM. The findings offer policy-relevant insights for developing targeted regulatory frameworks, environmental education programs, and technological support mechanisms to facilitate sustainability transitions in heritage-based industries. Moreover, the results provide implications that may be applicable to traditional MSMEs in other developing economies.