Factors influencing the implementation of sustainable employment practices by Small and Medium Enterprises in Nairobi, Kenya

Abstract

The global sustainability goals are compelling business enterprises of all kinds to take action by implementing organization-wide sustainability initiatives. While larger corporations increasingly recognise the importance of sustainability and make significant strides, small and medium enterprises (SMEs) appear to lag behind. These smaller enterprises are thought to face challenges when it comes to implementing sustainability initiatives. The study aimed to examine the factors affecting SMEs in adopting sustainable employment practices. In particular, the study sought to determine how resource slack, upper management commitment, organizational culture, and employment regulations framework influence SMEs' adoption of sustainable employment practices in Nairobi County, Kenya. The contingency theory and the triple bottom-line theory underpinned the study. A positivist research philosophy was followed, and a descriptive cross-sectional research design was adopted. A sample of 400 SMEs from a population of 90,000 SMEs in Nairobi County was targeted, from whom HR officers were selected using a purposive sampling technique and surveyed using structured questionnaires. Descriptive and inferential statistics were employed for data analysis, and findings were published using tables and figures. Descriptive statistical analysis reveals that, while respondents indicated a moderate positive perception of leadership support for sustainable employment practices, the overall perception of resource slack, organizational culture, and employment regulations were relatively low, suggesting areas for improvement. Inferential statistics demonstrate that resource slack, organizational culture, and top management support significantly influence the adoption of sustainable employment practices, with organizational culture having the strongest effect, followed by top management support. Employment regulations, on the other hand, were found to have no significant effect on sustainable employment practices. These findings underscore the value of robust corporate culture and supportive leadership in driving sustainable employment practices. Therefore, the study concludes that resource slack, culture, and leadership support are the primary drivers of sustainable employment practices in SMEs, with organizational culture and leadership support being the most crucial factors for success in sustainable employment practices. Therefore, at policy level, the study recommends creating targeted policies and incentivizing SMEs to adopt sustainability frameworks for their employment practices. At practical level, it proposes that SMEs should strengthen their internal structures to drive sustainability efforts effectively.

Keywords: implementation, sustainable employment practice, employment practices, resource slack, top management support, organizational culture, employment regulation.