Exploring How ESG-Enabling SMEs Build Corporate Reputation in Internationalization: A Multiple Case Study of Indonesian Sustainability Service Firms
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This study examines how ESG-enabling small and medium-sized enterprises (SMEs) build corporate reputation during internationalization. While environmental, social, and governance (ESG) practices are widely discussed in relation to large corporations, limited attention has been given to SMEs that support other firms through sustainability-related services, technologies, and advisory solutions. These firms contribute to environmental compliance, sustainability reporting, and stakeholder engagement, yet little is known about how they develop reputation when expanding internationally. This study addresses that gap by exploring how internal capabilities, stakeholder relationships, and contextual conditions shape reputation in internationalization.
A qualitative multiple case study approach was adopted, focusing on three Indonesian ESG-enabling SMEs: MUSA Green, Nobu Instruments, and Tunas Muda Seharapan. Primary data were collected through semi-structured interviews with key organizational representatives and complemented by secondary sources such as company materials and publicly available information. The data were analyzed using thematic analysis to identify patterns within and across the cases. The study is theoretically grounded in the Resource-Based View (RBV) and Stakeholder Theory. RBV explains how firms use valuable resources and capabilities to create competitive advantage, while Stakeholder Theory highlights the importance of managing relationships with actors who influence organizational outcomes and reputation.
The findings show that corporate reputation in internationalization is built through the interaction of internal strengths and external engagement. First, technical expertise, innovation capability, adaptive problem-solving, and service customization emerged as important resources that help firms differentiate themselves across markets. Second, stakeholder-oriented practices such as responsiveness, collaboration, trust-building, and consistent delivery of sustainability outcomes significantly strengthen reputational standing. Third, the Indonesian institutional environment presents both challenges and opportunities. Limited ESG awareness, regulatory inconsistency, and resource constraints may hinder growth, yet these conditions also encourage adaptability, innovation, and distinctive market positioning that can support international expansion.
This study contributes by extending discussion of corporate reputation beyond large firms and highlighting ESG-enabling SMEs as relevant actors in international business. Practically, the findings offer implications for managers and policymakers seeking to strengthen sustainability-oriented firms.