ENVIRONMENTAL RESPONSIBILITY OF MICRO AND SMALL ENTERPRISES IN THE SERVICES SECTOR IN BAJA CALIFORNIA, MEXICO, ITS EFFECT ON COMPETITIVE AND FINANCIAL PERFORMANCE

Objective: The study evaluates the impact generated by Corporate Environmental Responsibility (CER) activities on Competitive Performance (CP) and Financial Performance (FP) of Micro and Small Business (MSMEs) in the service sector in Mexicali, Baja California, Mexico. Theoretical Framework: From a sustainability perspective, corporate environmental responsibility and its relationship with various constructs and their interactions such as competitive and financial performance are analyzed. Method: A survey was developed and applied to 57 company managers in the following sectors: private sector medical laboratories, car repair and laundries, differentiated by the management of waste with potential environmental impact and greater demands in compliance with environmental standards. To confirm the hypotheses raised, an exploratory factor analysis and linear regressions of the constructs formed were applied. Results and Discussion: It was found that there is a strong relationship between CER and CP, however, there is no influence of CER on CP. Research implications: Service sector entrepreneurs continue to view RAE activities as expenses and financial burdens, which prevents them from taking RAE as a development strategy. They have not adopted strategies that allow them to benefit from the RAE actions they carry out, and it prevents a better environmental performance of SMEs in the service sector. Originality/Value


INTRODUCTION
Faced with multiple global environmental, social and economic challenges, it is necessary for companies to develop sustainability strategies that help raise their performance in the long term, however, resistance continues to adjust to the demands of a sustainable economy, with greater predominance in developing countries with significant differences between economic sectors.The development of analyzes is necessary to identify the obstacles that cause favorable organizational changes, based on sustainability, creating reference frameworks for companies from local contexts (Lăzăroiu et al., 2020) that allow creating programs and initiatives based on the needs of business sectors with specific characteristics, that allow to increase the number of actors committed to sustainability (Porter & Kramer, 2006), which represents a challenge, especially for MyPE, since they must generate forms of production that improve their environmental responsibility increasingly required by the context (Bikefe et al., 2020) (Severo et al., 2019).
The relationship between environmental care activities and the performance of companies depends on various factors such as the sector of activity of companies, the geographical context and the size (Valdés, Gallardo & Ramos, 2019).It has been shown that there is a positive relationship between environmental responsibility and business performance, however, most of the studies are from developed countries (Kao et al., 2018), the conditions faced by companies in developing countries remain very different and can still be seen as a limiting rather than favorable factor (Rovetta et al., 2023), analysis of a greater number of cases from various contexts is necessary and it is advisable to analyze separately environmental practices from social ones (Madime & Cruz, 2022), in most developing countries, there is low pressure from society and interest groups which causes the little interest of agents to get involved in the SAR, also problems of infrastructure provision, waste management systems, sanitation, etc. (Pahlen, Campo & Romano, 2014).
Environmental legislation for companies is very diverse among countries, in many meeting only the minimum criteria, validated by recognitions such as Corporate Social Responsibility (CSR) that also addresses other aspects, such as social and labor, whose progress in Mexico CSR, has been minimal between 2013 and 2019, is voluntary and is regulated by nongovernmental organizations (Alexander, Ferma & Gunadi, 2023), however, the environmental aspect is one of the most influential factors for the adoption of CSR.Mexico still has a lot of work to do to get its companies to start seeing the SAR as a long-term investment that will bring benefits to both the internal and external parts of the organization, one of the factors that can influence the low level of progress is the absence of consumer pressure for companies to adopt best practices and highlights the services sector as one of the least active (Responsable, 2019).In Mexico, in particular medium-sized companies, they are unaware of the incentives, motivations and benefits of implementing environmental management as a tool to incorporate sustainability into business strategy (Semarnat, 2017).
The results in Mexico of the adoption of CSR are diverse: strengthening the brand image and reputation of the company; increase in the financial performance of the organization; greater access to capital; decrease in operating costs; increase in quality; increase in sales; attraction of investors for its good positioning; reduction of costs due to actions such as recycling and reduction of activities dangerous to the environment (Manjarrez et al., 2021), however, it is necessary to measure the effect that the implementation of environmental investments has in a specific way.The objective of this work is to evaluate the impact generated by the activities of Corporate Environmental Responsibility (RAE) on the Competitive Performance (DC) and Financial Performance (DF) of the MyPE of the service sector, of Mexicali Baja California, Mexico, which will serve to identify if there are incentives, so that a greater number of companies in the service sector implement sustainability strategies.The performance is the result of multiple previous actions, so it proposes to measure the variable through financial and non-financial elements, and thus allow cross-comparison in the measure of compliance with objectives and results of the company (Ebabu, 2021).
In Baja California the degree of ignorance of environmental regulations within the business system is still high, 35% of companies do not know if they comply with environmental regulations.The service sector is one of the largest with a large number of activities and different levels of adaptation and application of environmental standards.Overall, business investments in environmental protection are still very low, as well as water treatment and reuse of materials (López et al., 2022).MyPE services have less pressure to implement RAE actions, operate in local markets with limitations in their vision and finances, so they tend to apply an informal management style (Gallardo, Valdez & Castuera, 2019).

THEORETICAL FRAMEWORK
Corporate Environmental Responsibility (SAR) is a fundamental component of corporate social responsibility that focuses on the strategies that companies follow to reduce the impact of their action on the environment, they can use it as a tool to improve their performance, financial and competitive, whose results depend on multiple factors such as the context, the legal framework, the environmental culture of consumers, as well as the adoption and development of environmental standards by the competitive framework (Crifo & Sinclair, 2013).Several factors can influence the readiness to adopt the SAR, external such as the conditions of the environmental and economic environment, internal such as its financial situation and vision of the managers, considering the stakeholders, among others (Alexander, Ferma & Gunadi, 2023).
The RAE allows to identify opportunities for improvement with the objective of reducing the impact on the environment and in the search for various benefits such as a better image, reputation and competitive impacts (Bustos, 2016), is the harmonious integration of the elements required to develop a management focused on preventing pollution, complying with requirements and environmental legislation, and continuously improving environmental performance.
Environmental performance is considered a concept derived from SAR, are the measurable results of the management that an organization makes of its activities, products and/or services that interact with the environment (ISO 1401(ISO , 2005)).Organizations evaluate their performance to measure progress and setbacks in the organization's relationship with the environment.The performance assessment is related to the characteristics of the organization and its substantive processes, is able to structure and provide information for decision-making, and communicate effective management based on environmental care (Trumpp et al., 2013).It helps to make internal processes more efficient by preventing defects and problems that lead to cost reduction, efficient environmental performance leads to competitiveness and economic 6 to implement sustainability and ensure that their supply chains function in a socially responsible manner.The interest group is a group or individual that can affect or is affected by the achievement of the organization's objectives, and that voluntarily or involuntarily contribute to its capacity and wealth creation (Cordeiro & Tewari, 2015).
Interest groups within the SAR are identified as one of the most influential factors that drive the decision of companies to improve their environmental performance beyond regulatory compliance, regulations and the existence of NGOs, (Magness, 2006, González & González, 2005).Stakeholders in a company can be defined as: individuals and interest groups who contribute, either voluntarily or involuntarily, to its wealth-creating capacity and activities and who are therefore its potential beneficiaries and/or risk carriers.
Demonstrate that the strategic incorporation of socially responsible actions, which concern and engage stakeholders, contributes to improve the competitiveness of small and medium-sized enterprises, the development of CSR practices contributes to increase competitive performance, both directly and indirectly, through the ability of these companies to manage their stakeholders (Herrera et al., 2016).
The proper selection of external supply suppliers is crucial for the growth of companies, the acquisition of the right inputs is part of strategic planning, taking into account the perspective of the sustainable supply chain requires suppliers to have their own environmental management (EG) strategies and is decisive for the development of sustainability within the company, monitoring and streamlining its processes helps reduce waste production and allows to develop a competitive advantage (Rao & Holt, 2005).Zhu and Sarkis (2007) address the integration of environmental actions and concerns into business practices (Lin & Lan, 2013).
Supply chain management focused on the perspective of environmental care is the resulting network of organized suppliers and distributors, focused on the operational efficiency of production, to reduce economic losses from waste (Lai & Cheng, 2009).The management of a supply chain integrated into environmental management can be a tool that generates strategies and promotes the environmental and financial performance of companies simultaneously (Hajikhani & Idris, 2012).
Companies that focus on sustainable practices gain benefits by reducing their expenses and improving the quality of their products, as well as their reputation, improving their performance that encompasses financial and non-financial measures, such as profitability and productivity, as well as other non-cost factors, such as quality, speed, delivery and flexibility (Tangen, 2005), when there are many variables involved, the final consequence of any competitive advantage derived from environmental management will probably be an Financial performance represents the economic production of the profits derived from the overall management of the company, which in turn includes the effects of its environmental performance.There are two relationships between financial performance and GA.On the one hand, a good financial performance is directly related to the investment to acquire technology and implement projects and strategies that improve the environmental and social functioning of the company; on the other hand, a good environmental and social functioning will result in a good financial performance due to the efficient use of natural resources and the correct use of social media in production (Martínez et al., 2013).In the long term, this implies a positive relationship between the incorporation of GA practices in an organization and its competitive and financial success.They found that companies implementing more proactive corporate environmental responsibility exhibited significantly positive financial performance (Aragón et al., 2008).

Scenario:
H1.-There is a positive and significant effect of the RAE on the competitive performance of the MyPE services.
H2.-There is a positive and significant effect of the SAR on the financial performance of the services MyPE.

METHODOLOGY
A survey was applied via email and telephone to 57 companies in the service sector of the veterinary branches, clinical laboratories, funeral services, maintenance of small cars, the selection was based on the assumption that they perform actions of RAE, because they are those that have more monitoring and audits by environmental authorities.The sample was obtained from a universe of 86 MyPE of the city of Mexicali (DENUE, 2022) for the delimitation of the sample universe, it was considered only companies that were formalized, so that they had at least the minimum compliance with environmental legislation and did not belong to chains or branches, the sample of finite populations was applied to a confidence level of 95%.For the selection and delimitation of the sample, it was considered that they were formalized so that they had at least the minimum compliance with environmental legislation and were not part of service chains.
A questionnaire composed mostly of multiple choice items and Likert scale with 7 alternative answers was designed to assess the degree of agreement-disagreement with the proposed statements.The questionnaire consists of a total of 61 questions distributed in seven blocks.

RESULTS AND DISCUSSION
An exploratory factor analysis was applied to extract the factors that are conformed, corroborate the independence between them and explain the greater amount of variance in the conformation of the matrix.The significance of factor values is subjective and refers to the knowledge one has of variables and intuition when constructing them (McDaniel & Gates, 1999).Each factor corresponded to the extraction of factors and was performed according to main components and rotation Varimax (Fabrigar et al., 1999).

Table 1
Reliability of constructs by Cronbach's Alpha analysis.9 The necessary factors proposed by the theory were extracted, the reliability tests (Cronbach's alpha), adequacy validity of the index (KMO) and Bartlett's sphericity gave acceptable coefficients, refuting the hypothesis that annuls the correlation of the indicators, allowing to proceed to the correlation matrix.After checking the reliability of the variables, the multiple regression model was executed with all the variables indicated under the least squares method, due to the sample size and its characteristics.
The normality of the variables was verified by the indexes of asymmetry and kurtosis, where absolute values less than 3 in the index of kurtosis and 1.96 in the index of asymmetry were obtained, likewise it was verified that the standard deviation was between the values -2 and 2, the variables meet the conditions of normality (DeCarlo, 1997).The results of Pearson's correlation coefficient for the dimensions are shown, it was found that the elements of the construct are correlated and give solidity of the relationships between variables, except financial performance, which shows low correlations.
To contrast the hypotheses formulated, a multiple regression model was constructed, which provides more information than the correlations.Three regressions were made, the first RAE as independent variable and Regression 1 DC = β0 + β1 DA + β2 GI + β3 CS+ ε Regression 2 DF= β0 + β1 DA + β2 GI + β3 CS+ ε Inflation factors of variance (VIF) were analyzed to rule out multicollinearity, which show acceptable values not less than .10 or greater than 5, ruling out the problem that some variable could be redundant (Hair et., to 2014).To rule out the existence of Autocorrelation the Durbin-Watson test was applied, the values obtained are significant and close to 2 so the autocorrelation problem is ruled out (Gujarati & Porter, 2010).Breuch Pagan measures heterocedasticity, the p-values are greater than the significance level so the presence of heterocedasticity is ruled out (Breusch & Pagan, 1979).Regarding regression 1 has a good level of adjustment with a tight R 2 of .64 and the components of the SAR, interest groups have the most influence on competitive performance with .48,followed by the supply chain .29 and, finally, environmental performance with .197.
Therefore, hypothesis 1 is accepted, since there is a positive and significant effect of Corporate Environmental Responsibility on the competitive performance of MyPE services.
Regarding regression 2, globally it does not have a good fit with an adjusted R 2 of .054,so hypothesis 2 is discarded, since there is no significant effect of Corporate Environmental Responsibility on the financial performance of the services MyPEs.
The results are consistent with the literature where interest groups are the ones who have the greatest weight to implement actions that impact on the performance of organizations.The results show a clear relationship between the SAR and DC of micro and small service companies in Mexicali, Baja California.These results coincide with Maletič et al. (2016), Fairfield et al. (2011), Sueyoshi and Goto (2008), López et al. (2009) as actions related to SAR increase, the DC increases, with GIs having the greatest impact on performance, so hypothesis 11 1 is accepted, since there is a positive and significant effect of the SAR on the competitive performance of services MyPEs.
There is no significant relationship between the SAR and the DF, which can be explained by the size and business activity of the population studied, in the literature there is no decisive position since some studies reveal the existence of a positive connection between environmental management and financial performance (González & González, 2005) (Melnyk, Sroufe and Calantone, 2003), on the other hand, there are investigations with results that show a negative relationship (Wagner, 2005).So hypothesis 2 is discarded.There is a positive and significant effect of Corporate Environmental Responsibility on the financial performance of service MyPEs.

CONCLUSIONS
The research provides results that show that environmental management improves the competitive performance of service companies, providing quantifiable benefits that are not unique to the industry, however, they have not managed to translate competitive performance into financial performance, so it can be seen as a mere compliance with minimum environmental standards and market permanence, rather than long-term growth, development and positioning strategies.
The DC's zero impact on the DF suggests that the MyPE services in Mexicali, Baja California, have not adopted strategies that allow them to benefit from the RAE actions they carry out, focused on a local market, are not required to meet international standards that provide them with commercial benefits, or the lack of knowledge in sustainability and government policies that offer incentives for companies that adopt social responsibility and environmental measures.Or it could be attributed to reasons specific to the characteristics of MyPES, the emphasis on day-to-day work, such as budgets, quality of services and direct attention to customers, which can translate into the abandonment of long-term objectives such as the issue of sustainability and environmental management.Some studies reveal the existence of a connection between environmental management and financial performance, they do not offer conclusive results since authors such as Melnyk, Sroufe and Calantone (2003), González and González (2005) show that the impact is positive, on the other hand, there are investigations with results that show a negative correlation (Wagner, 2005).In the case of this research it is possible to interpret that there is no significant relationship between environmental management and financial performance, which can be explained by the size and business activity of the population that differ from the aforementioned studies.
There may be a lag effect in the incorporation of corporate environmental responsibility measures and the effects that could be captured in the medium and long term, so it would be necessary to monitor at another time to review whether the same relationship is maintained.It is important to note that, although most companies do activities aimed at trying to minimize energy, water, waste consumption and recycling does so for compliance with environmental legislation, not as a strategy to obtain financial benefits in the long term.Until environmental responsibility actions are translated into financial benefits, MyPES will continue to perceive it as an expense, rather than an investment, which will not help improve the environmental performance of the region's business system by generating negative synergies.
performance of the company (Parris & Kates, 2003) (Denčić-Mihajlov & Zeranski, 2017).Involving stakeholders and guiding the value chain towards more sustainable business routines are key concerns to improve the management of SAR.Stakeholders call on companies Environmental Responsibility of Micro and Small Enterprises in The Services Sector in Baja California, Mexico, Its Effect on Competitive and Financial Performance ___________________________________________________________________________ Rev. Gest.Soc.Ambient.| Miami | v.18.n.9 | p.1-16 | e08315 | 2024.
improvement in financial performance.Lopez et al. (2009).Qi, Zeng, Shi, Meng, Lin and Yang (2014) prove that industrial environmental performance has a positive effect on financial performance and that lack of resources can moderate the relationship.The overall benefit of environmental performance includes increased revenue through improved operational efficiency and environmental reputation, and reductions in environmental risk by preventing environmental disasters that could have negative effects on company performance.

Table 2
Pearson correlation coefficients and normality test.

Table 4
Model statistics Environmental Responsibility of Micro and Small Enterprises in The Services Sector in Baja California, Mexico, Its Effect on Competitive and Financial Performance ___________________________________________________________________________ Rev. Gest.Soc.Ambient.| Miami | v.18.n.9 | p.1-16 | e08315 | 2024.