THE SUSTAINABILITY PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES (SMES) WITHIN THE SERVICE SECTOR

A COMPREHENSIVE REVIEW

Abstract

This comprehensive review investigates the sustainability performance of small and medium enterprises (SMEs) within the service sector, discussing the pressing need for a structured understanding of their contributions to sustainable development. In spite of the growing recognition of SMEs as vital players in the service economy, their sustainability challenges and performance remain inadequately explored. Utilizing the PRISMA framework, we conducted an extensive literature search in reputable databases, including Scopus and Web of Science (WoS), focusing on studies published in 2024. Our search yielded 33 relevant articles, which we systematically analyzed to identify key themes in sustainability performance. The findings are categorized into three main themes: (1) Digital Transformation & Innovation, which highlights the role of technological advancement in enhancing operational efficiency and sustainability; (2) Sustainable Practices & Corporate Social Responsibility (CSR), emphasizing the adoption of environmentally friendly practices and community engagement; and (3) Resilience, Strategy, & Competitiveness, which explores how SMEs navigate challenges as well as leverage strategies for sustainable growth. The review concludes that although SMEs are becoming more aware of the significance of sustainability, there is a significant variation in performance driven by factors such as industry type and organizational capacity. This research contributes to the academic discussion on sustainability in SMEs as well as offers practical insights for practitioners and policymakers focused on promoting sustainable practices within the service sector.