SMALL FIRMS, BIG IMPACT: EXPLORING SUSTAINABILITY DRIVERS IN TEXTILE SMES THROUGH REPORTING, RISK, AND LEADERSHIP

Abstract

This research examines the pathways through which climate change reporting (CCR), stakeholder pressure (SP), and managerial climate risk perception (RP) affect sustainable business performance (SBP) in Pakistan’s textile industry, situating green strategic alignment (GSA) as an intermediary and top management climate commitment (TMCC) as a moderating force. A structured questionnaire elicited responses from a sample of 320 firms, with the resulting dataset subjected to the PROCESS macro using 5,000 bootstrapped resamples. Empirical evidence confirms that CCR, SP, and RP each exerts a positive and statistically robust influence on SBP. Mediation analysis (Model 4) indicates that GSA exerts partial mediation: the alignment of strategic green objectives enables the effective translation of both exogenous and endogenous climate signals into performance gains. Moderation analysis (Model 1) establishes that the moderating influence of TMCC is confined to the CCR–SBP link, whereas TMCC does not alter the strength of the GSA–SBP association. Collectively, the independent, mediated, and moderated pathways accounted for 61% of the variance, affirming that integrated climate reporting, purposeful alignment, and resolute leadership commitment are critical levers for sustainable performance. The findings advance the sustainability and governance literature by operationalising a regression-based bootstrapping framework, thereby providing both theoretical substantation and concrete, implementable guidance for managers in climate-sensitive sectors.

Keywords: Climate Change Reporting; Sustainable Business Performance; Green Strategic Alignment; Top Management Climate Commitment.