The Role of Sustainable Business Environment in Shaping Entrepreneurs’ Performance: Evidence from Myanmar

Xiaokang Zhao, Nyo Me Hlaing (), Huali Shen, Pan Xiao and Tessema Shimelis Adugna
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Xiaokang Zhao: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Nyo Me Hlaing: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Huali Shen: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Pan Xiao: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Tessema Shimelis Adugna: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China

Sustainability, 2025, vol. 17, issue 2, 1-26

Abstract: This study explores how Myanmar’s sustainable business environment influences entrepreneurs’ performance, focusing on the mediating role of knowledge spillover effects of foreign direct investment (KFDI). Data were gathered from 308 entrepreneurs across micro, small, medium, and large enterprises in Myanmar using online surveys via Google Forms and Microsoft Forms. The analysis employed partial least squares structural equation modeling (PLS-SEM) with SPSS 29 and SmartPLS 4. The results reveal that (i) the economic environment exerts a substantial positive influence on entrepreneurs’ performance; (ii) access to credit and the social environment show no discernible impact on entrepreneurs’ performance; (iii) both economic and social environments positively influence KFDI; (iv) access to credit has no effect on KFDI; and (v) KFDI partially mediates the relationship between the economic environment and entrepreneurs’ performance while fully mediating the relationship between the social environment and entrepreneurs’ performance. However, KFDI does not mediate the effect of access to credit on entrepreneurs’ performance. These findings underscore the critical role of sustainable economic and social environments in enhancing entrepreneurs’ performance and attracting foreign firms. Policymakers should prioritize these dimensions of the business environment to foster growth, maximize KFDI, and support long-term entrepreneurial success. This approach will not only ensure the economic vitality of Myanmar’s entrepreneurial ecosystem but also contribute to broader social and environmental sustainability.

Keywords: entrepreneurs’ performance; economic environment; access to credit; social environment; knowledge spillover effects; foreign direct investment; PLS-SEM (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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