Indigenous SMEs and nonmarket strategy: leveraging cultural capital, sustainability and Indigenous diplomacy in international business

Purpose This paper aims to explore how Indigenous-owned small and medium enterprises (SMEs) pursue internationalization through nonmarket strategies, emphasizing sustainability orientation, Indigenous-to-Indigenous trade networks and cultural capital. The authors highlight how these nonmarket approaches – rooted in unique cultural values and community relationships – complement market strategies to build legitimacy and competitive advantage in global markets. Design/methodology/approach This study adopts a narrative synthesis approach, drawing illustrative examples from secondary sources such as Indigenous business websites, panel discussions, news articles and existing case studies. These examples serve as narrative vignettes to contextualize the conceptual discussion, selected based on their relevance, recency and regional diversity. This approach grounds theoretical arguments in practice while maintaining transparency about source selection. Findings Indigenous-owned SMEs use nonmarket strategies grounded in cultural values such as sustainability, reciprocity and community well-being. They develop Indigenous-to-Indigenous trade networks that function as trust-based bridges across borders, mitigating institutional voids and opening new channels for market access. Through Indigenous corporate diplomacy and stakeholder engagement, these firms act as cultural ambassadors, navigating regulatory environments and shaping perceptions to enhance credibility. Leveraging cultural capital (e.g. traditional knowledge, authenticity and storytelling) allows them to build legitimacy and differentiate their offerings. Together, these nonmarket strategies provide Indigenous SMEs with complementary pathways to internationalization alongside traditional market entry modes. Practical implications The findings encourage policymakers and business leaders to recognize the nonmarket strengths of Indigenous enterprises. Supporting Indigenous-led sustainability initiatives, facilitating Indigenous business exchanges and forums and including Indigenous representatives in trade dialogues are ways to enhance the international success of these firms. Indigenous entrepreneurs are advised to actively communicate their cultural commitments and sustainability practices as competitive assets in global markets so as to manage their reputations and stakeholder relationships effectively. Social implications Advancing Indigenous SMEs on the world stage contributes to economic reconciliation and the preservation of cultural heritage. Success of Indigenous SME models socially conscious business practices, benefiting broader society through the promotion of sustainable development and diversity in entrepreneurship. Furthermore, Indigenous diplomacy and trade networks reinforce political empowerment and solidarity among Indigenous peoples across countries, strengthening a more inclusive global economic system. Originality/value This work reframes Indigenous SMEs as proactive strategists in international business rather than passive actors constrained by institutional deficits. It extends nonmarket strategy discourse by introducing the notion of Indigenous corporate diplomacy and by highlighting Indigenous-to-Indigenous trade as an emerging form of international business network. By integrating cultural capital and sustainability into the analysis of nonmarket strategy, the perspective broadens international business theory to include historically underrepresented Indigenous voices and knowledge systems.