The Impact of Solar Photovoltaic (PV) Adoption on Corporate Image and Business Sustainability in Malaysian Small and Medium Enterprises (SMEs)

Abstract

Solar photovoltaic (PV) is a rapidly growing renewable energy technology that converts sunlight directly into electricity. As a clean and sustainable alternative to fossil fuels, solar PV is increasingly recognised as a critical component in shifting to a low-carbon economy. Solar PV is often associated with a high upfront cost. Nevertheless, solar PV adoption can provide significant long-term financial benefits and energy saving in the long run, especially for small businesses. Even though many incentives have been introduced to promote solar PV adoption, the number of studies focusing on the impact of such adoption, particularly in Malaysian small and medium enterprises (SMEs), is still scarce. As a result, little is known about how solar PV adoption can benefit SMEs. This study, therefore, examined the relationship between (1) solar PV adoption and corporate image; and (2) solar PV adoption and business sustainability (economic, environmental, and social). A quantitative research approach was employed to gather the data, which involved distributing a questionnaire to the targeted users. Data from sixty-nine (69) SMEs from manufacturing industries were analysed using SmartPLS (version 4.0). The manufacturing sector was selected as it is among the significant contributors to the increase in carbon dioxide emissions. Hence, the key players’ awareness and understanding of the issue are crucial to promoting solar PV’s future adoption. The outcome of this study reveals a positive relationship between solar PV adoption and corporate image, and economic and environmental sustainability. There is no evidence, however, to support the relationship between solar PV adoption and social sustainability. This research contributes theoretically to bridging the gap in understanding the impact of solar PV adoption on corporate image and business sustainability, particularly in the context of manufacturing SMEs. Practically, this study provides recommendations on how the results could be exploited to promote solar PV adoption among SMEs.