ESG awareness as a catalyst for sustainable strategy development in small and medium enterprises (SMEs) in Vietnam | |
| Author | Ha Thi Quynh Tram |
| Call Number | AIT Proj. no.PM-ESG-26-02 |
| Subject(s) | Social responsibility of business--Vietnam Sustainable development--Vietnam Small business--Vietnam |
| Note | A project report submitted in partial fulfillment of the requirements for the degree of Professional Master in ESG (Environment-Social-Governance) Management |
| Publisher | Asian Institute of Technology |
| Abstract | This study investigates how ESG (Environment, Social, and Governance) awareness translates into strategic institutionalization among 28 small and medium-sized enterprises (SMEs) in Ho Chi Minh City, Vietnam. While prior research focuses primarily on large corporations in developed markets, this study addresses a critical gap by examining how emerging-market SMEs navigate global sustainability pressures amid weak institutional frameworks. Drawing on a thematic analysis of in-depth CEO interviews and combining deductive and inductive coding, the research explores three questions: how SMEs perceive ESG, what barriers prevent implementation, and how they respond to Vietnam's Net Zero 2050 commitment. Percentages reported in this study indicate descriptive prevalence across cases to enhance analytical transparency. They do not imply statistical generalizability but serve as heuristic indicators of thematic patterns identified through interpretive qualitative analysis. This approach aligns with qualitative traditions that permit limited quantification without compromising epistemological consistency.The findings reveal a structurally embedded awareness–implementation gap. Although 86% of SMEs demonstrate conceptual awareness of ESG principles, only 32% have translated this awareness into institutionalized practices characterized by documented policies, assigned responsibilities, and structured monitoring systems. This gap suggests that cognitive recognition alone is insufficient for strategic integration, particularly in contexts marked by limited managerial capability, weak regulatory enforcement, and constrained access to technical guidance. This awareness–implementation gap is shaped not only by financial constraints but also by structural and capability-related barriers, including insufficient practical guidance (57% of firms) and limited capacity to formalize knowledge into structured processes. The study identifies a “Spontaneous ESG Trap”, a condition in which culturally embedded sustainability practices remain informal, undocumented, and strategically unarticulated, affecting 36% of firms.Theoretically, this research advances a bounded institutional refinement rather than a universal theory extension. By demonstrating that coercive pressure in transitional economies may be market-mediated rather than state-driven, the study clarifies the conditional dynamics of institutional influence.The Inverted Institutional Pressure Model should therefore be interpreted as a context contingent configuration applicable to hybrid governance systems characterized by partial enforcement, strong export orientation, and relational business cultures. This bounded contribution avoids overgeneralization while strengthening theoretical precision. In addition, identifying the “Spontaneous ESG Trap” contributes to sustainability scholarship by explaining why culturally embedded social responsibility practices may remain strategically underleveraged. The concept extends existing awareness–action gap literature by specifying organizational formalization as the missing institutional link. This refinement suggests that in transitional governance systems characterized by partial regulatory enforcement and deep global market integration, market-based actors may substitute for state regulators in generating coercive institutional pressures. The model therefore contributes to institutional scholarship by specifying boundary conditions under which pressure hierarchies shift, particularly in hybrid governance contexts. The findings also contribute to stakeholder and resource-based perspectives. In collectivist emerging-market contexts, the analysis suggests a pattern of community–customer primacy, in which relational and reputational considerations play a stronger role than shareholder-driven pressures. Rather than proposing a new stakeholder theory, the study highlights how stakeholder salience may be culturally conditioned. From a resource-based perspective, the findings indicate that access to practical ESG guidance serves as a strategic enabler, particularly for SMEs with limited internal capabilities. This insight refines the understanding of intangible capabilities in resource-constrained environments. In practice, the findings suggest differentiated intervention strategies for the four stakeholder groups. For SMEs, the priority lies in formalizing existing informal sustainability practices into structured governance mechanisms. For policymakers, the results indicate that enablement based approaches such as practical guidance frameworks and capacity-building initiatives may be more effective than enforcement-centered strategies in hybrid institutional contexts. Financial institutions can play a catalytic role by designing green financing instruments tailored to SMEs limited collateral capacity. Finally, ESG advisory services should adopt tiered, affordability-sensitive models that reflect SMEs’ resource constraints. This research contributes to emerging-market sustainability scholarship by offering empirically grounded theoretical refinement and context-sensitive implementation pathways applicable to resource constrained institutional environments. |
| Year | 2026 |
| Type | Project |
| School | School of Management |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Professional Master in Environment, Social & Government Managment (PMESG) |
| Chairperson(s) | Levermore, Roger |
| Examination Committee(s) | Krishna, P.V. Gopi;Galipeau, David |
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