Sense or Sensibility? Managerial Sensemaking and Responsible Business Practices in International Small and Medium-Sized Enterprises

Abstract

International business today is increasingly stimulated to be conducted in a socially and environmentally responsible way. The United Nations’ Sustainable Development Goals have emphasized the role of international business as an agent of transformation. Sustainability and related issues are global by nature; thus, they have a reach in international business and in providing international entrepreneurial opportunities. Despite this, research on international business and sustainable development has focused primarily on large multinational enterprises, while studies on international entrepreneurship (IE) have remained relatively absent. This study contributes to the literature on the internationalization of small and medium-sized enterprises (SMEs) by shedding light on how managers of international enterprises make sense of responsible business practices (RBPs). With an empirical sample of 179 Finnish internationalized SMEs and linear regression analysis, the study finds out that communication of sensemaking enhances the firms’ RBPs. This study illustrates the role of the sensemaking approach in IE, where it is essential to account for managerial sensemaking when seeking to explain how international entrepreneurial firms strategize for sustainable international business and can potentially contribute to Sustainable Development Goals.