ABSTRACT This study explores the influence of Knowledge Management (KM) activities on organizational performance (OP) within small and medium‐sized enterprises (SMEs), with a specific focus on the mediating role of green innovation (GI). In an era marked by rapid societal, technological, and environmental changes, KM has emerged as a key driver for fostering innovation and maintaining competitive advantage. Despite its critical importance, the relationship between KM activities and GI, particularly within SMEs, remains underexplored. Using structural equation modeling (SEM), this research investigates how KM activities knowledge acquisition, creation, retention, and sharing can promote green innovation, which in turn enhances organizational performance. Data collected from 320 SME representatives in Ghana reveals that all KM activities have a positive influence on GI, significantly contributing to organizational performance. The findings highlight the essential role of both KM and GI in advancing sustainable business strategies, providing key insights for managers and policymakers. This study contributes to existing literature by addressing the research gap at the intersection of KM and GI, especially within the context of SMEs in developing countries. It offers empirical evidence that effective KM practices not only directly enhance organizational performance but also do so indirectly by fostering green innovation. The results provide valuable guidance for managers and policymakers seeking to improve organizational strategies, underscoring the significance of sustainable innovation for long‐term success. Additionally, this research advances the Knowledge‐Based View (KBV) theory and its practical application, emphasizing the importance of managing knowledge activities and fostering eco‐friendly innovation within organizations.
Zhang et al. (Wed,) studied this question.