Abstract

This study holistically tested the competitive advantage between the resource-based view approach and the green concept in products and processes (green innovation), especially in SMEs. The sample used was 100 SMEs actors in Indonesia, with a proportional sampling method. This study proved that the competitive advantage of SMEs in Indonesia can be reached by increasing intellectual capital, environmental ethics and green innovation holistically. The ability of companies to manage environmentally oriented human resources in their operating systems will improve the performance of SMEs and can further create competitive advantage.