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The Role of Institutional and Geographic Proximity in Enhancing Creating Shared Value (CSV) Initiatives Within Local Industrial Clusters: A Study of Japanese SMEs

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  • Naoto Shirasawa

    (Department of Industrial and Systems Engineering, Graduate School of Science and Technology, Tokyo University of Science, Noda 278-8510, Japan)

  • Yuna Seo

    (Department of Industrial and Systems Engineering, Graduate School of Science and Technology, Tokyo University of Science, Noda 278-8510, Japan)

Abstract

Creating Shared Value (CSV), a contemporary management strategy aimed at generating both economic and social value, has gained increasing attention in the context of sustainable regional development. This study examines the implementation of CSV within local industrial clusters, specifically investigating the influence of institutional and geographic proximity on the sustainability of small and medium-sized enterprises (SMEs). Utilizing surveys conducted across 11 industrial clusters in Japan and employing structural equation modeling, the impact of proximity on CSV initiatives was explored. The findings reveal that firms within these clusters enhance their sustainability by fostering iterative knowledge transfer and technological collaboration, particularly with geographically and institutionally proximate organizations. Moreover, the study highlights that a clear understanding and alignment of sustainability-oriented goals within institutional proximity strengthen the synergy of management resources through alliance capabilities, ultimately leading to the simultaneous creation of social and economic value. This research underscores the critical role of proximity in shaping effective and sustainable CSV initiatives within local industrial clusters, providing valuable insights for policymakers, industry stakeholders, and researchers aiming to promote regional sustainability and resilience.

Suggested Citation

  • Naoto Shirasawa & Yuna Seo, 2025. "The Role of Institutional and Geographic Proximity in Enhancing Creating Shared Value (CSV) Initiatives Within Local Industrial Clusters: A Study of Japanese SMEs," Sustainability, MDPI, vol. 17(6), pages 1-24, March.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:6:p:2410-:d:1608848
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