DRIVERS OF GREEN TECHNOLOGY ADOPTION IN SMES: EMPIRICAL EVIDENCE FROM BOSNIA AND HERZEGOVINA

Abstract

The transition towards environmentally sustainable business practices has become a growingly important strategic priority for small and medium-sized enterprises (SMEs), especially in those countries which aspire for the closer integration with the European Union. This analysis examines the determinants of green technology adoption and their impact on the growth of sustainable investment in SMEs in Bosnia and Herzegovina. The research is based on the Resource-Based View and Institutional Theory to explore the impact of financial capacity, institutional support, managerial awareness and perceived benefits of green investments comparing the enterprises operating in the Federation of Bosnia and Herzegovina and Republika Srpska. The empirical analysis is based on data collected from 150 SMEs through a structured questionnaire. Descriptive statistics, reliability analysis, independent-samples t-test, Pearson correlation and multiple linear regression analyses were performed with IBM SPSS Statistics. The results show significant differences in the adoption of green technologies between the two entities, confirming the relevance of the institutional environment. The regression analysis further shows that managerial awareness and perceived benefits of green investments are the strongest predictors of sustainable investment growth, while financial capacity and institutional support do not exert significant independent effects after controlling for other variables. The findings emphasize the relevance of managerial capabilities and strategic orientation in accelerating the green transition of SMEs. The study contributes to the scarce empirical evidence on green technology adoption in Bosnia and Herzegovina and offers practical recommendations for business managers and policymakers who want to strengthen sustainable business development and environmental competitiveness.