Strategic Restraint or Strategic Action? Institutional Contingencies of Organizational Learning and Green Investment

ABSTRACT Manufacturing SMEs in emerging markets face a critical paradox: mounting regulatory pressure to adopt environmental practices conflicts with severe resource constraints and uncertain investment returns. We examine how anticipatory organizational learning (AOL)—firms' proactive scanning of environmental trends—relates to green investment among resource‐constrained SMEs, and how regulatory pressure and corporate political activity (CPA) moderate this relationship. Drawing on dynamic capabilities and institutional theories, we test a moderation model using data from 250 Ghanaian manufacturing SMEs. Results reveal that AOL positively predicts green investment. CPA amplifies this relationship by facilitating access to institutional resources. However, regulatory pressure attenuates the learning–investment relationship, suggesting that under inconsistent enforcement and institutional instability, learning rationally leads to compliance minimization rather than proactive investment. These findings challenge assumptions that learning automatically drives strategic action and that regulatory pressure uniformly promotes compliance. We demonstrate that capability‐performance relationships among resource‐constrained firms depend critically on resource access and institutional stability. For policy, intensifying regulatory pressure without stable enforcement may inadvertently cause SMEs to minimize compliance costs rather than pursue genuine environmental improvement.