Abstract

It is well established that micro, small, and medium enterprises (MSMEs), as a dominant form of business globally, undoubtedly significantly contribute to national economies and the United Nations' Sustainable Development Goals (SDGs). Nonetheless, how family-owned MSMEs contribute to the SDGs (sustainability performance) is a relatively less explored domain. This study investigates the role of family governance practices and family social capital in achieving economic, social, and environmental goals, corresponding to SDGs 8, 11, and 13, respectively. We collected data from 421 family MSMEs through survey questionnaires. We employed a partial least squares approach to structural equation modeling (PLS-SEM) to test the research hypotheses and analyzed the data in SmartPLS4 software. The findings revealed that effective family governance practices in family MSMEs positively impact economic, social, and environmental SDGs, while well-managed family social capital catalyzes this significant relationship. This implies that to effectively contribute to the SDGs, the owner family needs to establish an effective family governance mechanism and also manage and capitalize on its social capital.