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Open Access Original Research

COVID-19 Milieu and Its Psychological Effects on the Environmental Performance

Nadia A. Abdelmegeed Abdelwahed 1,*, Mohammed A. Al Doghan 1, Bahadur Ali Soomro 2

  1. Department of Business Administration, College of Business Management, King Faisal University, Al Hofuf, AIAhsa, Saudi Arabia

  2. Department of Economics, Abdul Haq Campus, Federal Urdu University of Arts, Science and Technology, Karachi, Pakistan

Correspondence: Nadia A. Abdelmegeed Abdelwahed

Academic Editors: Ines Testoni, Adriano Zamperini and Lorenza Palazzo

Special Issue: How COVID-19 Changed Individual and Social Life: Psychological and Mental illness Studies on the Pandemic Outcomes

Received: June 03, 2023 | Accepted: August 17, 2023 | Published: August 22, 2023

OBM Neurobiology 2023, Volume 7, Issue 3, doi:10.21926/obm.neurobiol.2303179

Recommended citation: Abdelwahed NAA, Al Doghan MA, Soomro BA. COVID-19 Milieu and Its Psychological Effects on the Environmental Performance. OBM Neurobiology 2023; 7(3): 179 ; doi:10.21926/obm.neurobiol.2303179.

© 2023 by the authors. This is an open access article distributed under the conditions of the Creative Commons by Attribution License, which permits unrestricted use, distribution, and reproduction in any medium or format, provided the original work is correctly cited.


COVID-19 brought significant challenges that have ruined almost all segments of the economy and the environment. The present paper explores the COVID-19 milieu and its impacts the environmental performance (EP). We targeted managers of the Small and Medium-sized enterprises (SMEs) of Saudi Arabia to get online responses. Using the path analysis, the findings reveal a significant negative effect of the factors such as perception of COVID-19 (PoCVD), innovation capability (IC), environmental concern (EC) and the fear of COVID-19 (FoCVD) on EP. The study's findings would draw policymakers' and planners' attention to the need to enhance EP in light of the COVID-19 waves. Lastly, the study results would add to the literature on COVID-19, management and environmental science.


COVID-19 milieu; environmental concern; innovation capability; environmental performance; SMEs

1. Introduction

The outbreak of COVID-19 has strictly influenced the national and global economies, where several enterprises confront diverse problems with a certain extent of losses. The COVID-19 pandemic severely impacts small and medium-sized enterprises (SMEs) worldwide. Explicitly, the principal victims of the COVID-19 explosion are SMEs and large enterprises. [1] reveal that SMEs frequently need more financial and management resources. The constructs, i.e., environmental concern (EC), perception of COVID-19 (PoCVD), fear of COVID-19 (FoCVD) and innovation capability (IC) are the significant barriers in developing the EP. The COVID-19 situations diminish the production and functions in the economy. According to [2], FoCVD is a depressive and anxious emotional state. In 2020, practically all economies' GDP decreased due to this circumstance [3]. COVID-19 insight also caused many worries among business owners and entrepreneurs [4]. The IC is a significant predictor of EP during the pandemic [5,6].

As a result, the COVID-19 outbreak is offered the indication and occurrence of upheavals [7]. Specifically, SMEs are out of stock and hardly still in business [8]. EP's of the enterprises have yet to be successful due to the FoCVD [5,9]. This scenario collapsed the economy and the lives of the people of society and led to dramatic changes in low business accomplishments [3].

Hence, this study would overcome the gaps in the investigation of the effect of FoCVD, IC, PoCVD and EC on EP among the managers of Saudi Arabia. The outcomes of the study would assist the policymakers in knowing the depth and effect of FoCVD, EC and IC towards EP. The research conclusions would help the government and SMEs authorities design fear-free policies in pandemic situations to boost and make an effective environment without fear.

2. Aim and Objectives of the Study

The study aims to investigate the effect of FoCVD, IC, PoCVD and EC on EP among the managers of Saudi Arabia. Based on this aim, we proposed the following specific objectives:

Objective 1: To investigate the role of PoCVD in predicting EP during COVID-19.

Objective 2: To explore the role of IC in predicting EP during COVID-19.

Objective 3: To examine the role of EC in predicting EP during COVID-19.

Objective 4: To inspect the role of FoCVD in predicting EP during COVID-19.

3. Literature Review and Framework

The free spread of COVID-19 put millions of people into the mouth of death and significantly destroyed life and the industry's daily routine. The fact that businesses have shut down to stop the virus' spread has also changed people's lifestyles, led to significant job losses, and put millions of people's resources in peril [10]. The EC is strongly connected to energy-related issues [11]. The results of [12] highlighted the strong negative impact on EP that COVID-19 and employees' responses to adjustments had. FoCVD may consequence in refining job effects in frontline nurses. According to [13], these have increased work satisfaction, decreased stress, and decreased desire to leave the business or their profession. In the perception of [14], contextual variables such as complexity, dynamism and generosity are negatively associated with EP. Besides, there is a negative correlation between EP and environmental risk. While environmental management capabilities significantly enhance the EP [15].

More specifically, PoCVD demonstrates individuals' feelings, anxiousness or nervousness about the coronavirus's arrival. It also shows the thinking of individuals on how companies may develop their strategies to deal with COVID-19 [4]. Likewise, the IC factor underlies the encouragement of SMEs for employees' facilitation of green innovation. This also highlights individuals thinking and creativity regarding the employees of SMEs [16]. Similarly, EC facilitates green innovation in which individual organizations promote a green culture among employees. This encourages developing a conducive environment that may promote EP, particularly in COVID-19 [16]. The final predictor (FoCVD) shows the fear individuals of SMEs confront during COVID-19. This also shows the extent of fearfulness during the pandemic [2]. Finally, EP demonstrates individuals' performance regarding the environment during COVID-19 in SMEs. The performance also includes the SMEs' energy/resource consumption [17].

In brief, the lethal virus (COVID-19) destroyed the organizations due to lockdown and executed new thoughts to maintain their routine work from home. This phenomenon has given rise to several negative worries about stress, annoyance, digital inequality, and work-family conflict, which have a detrimental impact on the performance of employees [18,19].

Consequently, the existing literature highlights the different constructs, i.e., employee reactions to changes, product innovations, IC, job satisfaction, green innovation, environmental regulation, stress, fear, frustration, work-family conflict, environmental risk, and environmental management capabilities positively or negatively affected the EP in the diverse regions [18,19,20]. Besides, these links have been investigated in the daily routines and the specific time of COVID-19. Nevertheless, this study finds the valid rationale that in the COVID-19 milieu, the previous literature did not focus on exploring the impacts of FoCVD, EC, IC and PoCVD on EP. Furthermore, the literature also provides empirical evidence that the EP is adversely affected by PoCVD, IC, EC and FoCVD during the pandemic [2,4,18,16,19]. Thus, researchers believe that EP may be negatively forecasted by FoCVD, EC, IC and PoCVD in SMEs of Saudi Arabia, particularly during the pandemic. Based on this argument and relationships in the literature, we formulated Figure 1 to explore SME managers in Saudi Arabia.

Click to view original image

Figure 1 Model of the study. Source: Developed by the researchers.

4. Hypotheses Development

4.1 PoCVD, IC, EC, FoCVD and EP

SMEs confronted massive risks in the COVID-19 environment [21]. PoCVD brought a lot of fear, particularly for firm owners and entrepreneurs [20]. PoCVD has seriously affected the global economy of Saudi Arabia Micro, small, and medium-sized enterprises (MSMEs) have noticed the pandemic's significant victims. SMEs must still develop plans and strategies to address these commercial and environmental concerns [22,23]. The technological and innovative capabilities, absorption, and productivity positively and significantly affect creative performance [24]. Rapidly changing and stable settings may be improved and built upon with an innovation strategy. A favorable and considerable impact of IC on corporate performance, environmental performance, and environmental sustainability performance has been documented in the literature [25,26].

According to [27], EC and problems might result in various decision-making contexts. These, in turn, significantly impact the manufacturing strategy construction process. Adopting proactive environmental management, which promotes raising EP, is influenced by how severe the environmental issues are. According to [20], EC is frequently beneficial for adopting environmentally responsible behaviors and pro-environmental values. Individuals improve environmental quality mostly because they think living in a polluted environment is unhealthy. People worldwide are experiencing anxiety, uncertainty, and anxiety due to COVID-19 and its concerns [28]. [9] demonstrate the connection between COVID-19 uncertainty and customer worry. FoCVD and anxiety enhance uncertainty and environmental concerns, decreasing EP.

Consequently, in the literature, factors such as FoCVD, IC, EC and PoCVD have appeared to be negative predictors of EP in regular routines [2,4,18,19]. However, the literature still needs their confirmation in an integrated way, particularly during the COVID-19 period [16,20,21,29]. Furthermore, contextually, the previous literature did not focus on conducting empirical studies in such domain in SMEs generally and predominantly in Saudi Arab’s context, despite their massive and negative effect on environmental ruins and EP [29]. Thus, based on the knowledge gaps of the disappearance of integrated approach containing CVD, IC, EC and PoCVD towards EP; and contextual gaps which need further confirmation of these associations, we proposed the following hypotheses for validation among managers of SMEs in Saudi Arabia:

H1. PoCVD is a negative predictor of the EP during COVID-19.

H2. IC is a negative predictor of the EP during COVID-19.

H3. EC is a negative predictor of the EP during COVID-19.

H4. FoCVD is a negative predictor of the EP during COVID-19.

5. Methods

5.1 Approach, Context and Units of Analysis

We applied the quantitative approach due to a valid process as it deals with statistical tests and provides authentic results. Several scholars, such as [22,23,24,25,26,27,28], applied the same techniques to explore the EP with diverse factors in the same dimension. Unambiguously, the SME sector in Saudi Arabia is accountable for the quick development of technology and the availability of a worldwide manufacturing network [22,23]. We gathered data from the managers of the manufacturing industries of Saudi Arabia because managers who examine all of an organization's problems are termed managers [30]. They also play a vital role in economic stability by stimulating SMEs [31]. The researchers conducted an online survey responding to Saudi Arabia's SOPs and stay-at-home policies.

5.2 Data Collection Methods and Sample Size

The entire poll was conducted using convenience sampling. We applied the sampling techniques as it is easy to trace respondents and accessible to the researchers. In the time of the pandemic, several scholars like [1], [3], [8] and [9] also applied a similar approach to conduct their empirical online assessment. As long as there were rules and recommendations regarding the survey, we adhered to the necessary ethical standards to protect the participants' human rights [32]. We asked them to offer their time to take part in the study. After getting the consent, we have attached and mailed 400 mail questionnaires. We also sent the links to WhatsApp groups of managers. These groups are mainly developed during the pandemic to make their routine activities via an online learning management system (LMS). Finally, we collected 218 usable cases with a 54% response rate.

We used the G*Power (version 3) test, a virtuous freeware program to ensure the required sample size. This test controls statistical power for the most popular statistical tests used to analyze sample size in behavioral research [33,34]. To conduct this test, we applied the four predictors (independent variables) to ensure a sufficient sample size. As a result, G*Power suggested 100 samples as enough to conduct the SEM analysis and to fulfill the AMOS software’s requirement.

5.3 Non-response Bias

We conducted an online through convenience sampling; thus, it is necessary to confirm data for potential non-response bias (NRB). NRB is viewed as a significant restriction of the inquiry, and to produce consistent results, the sample must be adequate and objective. To tackle this critical issue, we pursued the suggestions of [35] by comparing the first thirty returned surveys as early responses and the final thirty returned as late responses. We employed three demographic factors, i.e., gender, age and experience, for measuring the assumption of NRB. We applied an analysis of variance (ANOVA) statistical test to confirm NRB. As a result, a statistically non-significant ANOVA score guarantees no discernible difference between the first and last responses. Thus, the findings support a sufficiently impartial sample.

5.4 Measurement Scales

We measured PoCVD with seven items borrowed from [4], with the sample item as “I feel anxious or nervous about the coronavirus.” The researchers assessed the IC factor with three items from [16]. The sample item of the scale is “To facilitate green innovation; our organization encourages employees to think creatively” Likewise, the EC predictor is assessed on three items adopted from [16]. The sample content for EC is “To facilitate green innovation; our organization cultivates a green culture among employees.” Furthermore, FoCVD was assessed on the ten-item scale of [2], with the content item as “I am most afraid of COVID-19” Finally, we measured EP construct on three items borrowed from the study of [36]. We modified this factor in the COVID-19 perspectives. The sample item is “COVID-19 environment reduces our organization’s energy/resource consumption” We measured all the items with a five-point Likert scale (strongly disagree = 1 to strongly agree = 5).

6. Analysis

6.1 Descriptive Statistics and Correlation

To determine the representation of data of the entire population, we conducted descriptive statistics. We observed the highest mean scores for FoCVD (3.521) and the lowest for EC (2.453). About the values of standard deviation, we found the highest values for IC (1.369) and the lowest for 1.129 (FoCVD) (see Table 1). Moreover, the correlation matrix also ensured good strength of the relationship. Subsequently, the results show that all the constructs, such as PoCVD, IC, EC and FoCVD, have links with EP (Table 1).

Table 1 Descriptive statistics and correlation matrix.

6.2 Measurement of the Model

To observe the relationship among items, we conducted factor loading and noted its values above 0.70 [37], except for items pocvd4, focvd3, focvd6, focvd8 and focvd10 did not appear with acceptable values. Consequently, low-loaded items were deleted [37]. Moreover, the composite reliability (CR) values were observed to be in-between 0.813 (EP) to 0.846 (EC) or >0.70 [37]. We assessed the factors' uniqueness, an average variance extracted values (AVE) and noticed the values of AVE in-between 0.799 (EC) to 0.845 (EP) for all factors (>0.50) [37]. Last, of all, we ensured Cronbach's alpha (α) for all factors within adequate edges (>70) [38] (Table 2).

Table 2 Measurement model.

6.2.1 Discriminant Validity

We assessed discriminant validity (DV) to assess the extent of association between constructs [37]. We used the [39] measure where all the correlation of factors appeared between ─0.021 to ─0.333, which is lesser than the square root of the AVE estimates, in the score of 0.772 to 0.799. This demonstrates how strongly the components are related to their relevant indicators compared to other constructs. Therefore, it suggests a good DV [37]. According to [40], the correlation between exogenous components is less than 0.85. (Table 3). As a result, the DV of the whole model constructs is met.

Table 3 Discriminant validity.

6.3 Structural Model

We used path analysis to evaluate hypotheses. About the results of H1, we found negative and insignificant effects of PoCVD on EP (H1 = SE = 0.034; CR = ─1.001; p > 0.01) and accepted the H1. Likewise, we found the negative and insignificant impact of IC on EP (H2 = SE = 0.020; CR = ─0.109; p > 0.01). Hence, H2 is supported. Moreover, the SEM scores accepted EC's negative and insignificant effects on EP (H3 = SE = 0.059; CR = ─1.128; p > 0.01). As a result, H3 is supported. Lastly, as expected, we found negative and insignificant effects of FoCVD on EP (H4 = SE = 0.077; CR = ─1.779; p > 0.01). Thus, the analysis accepts the final hypothesis (H4) (Table 4 and Figure 2).

Table 4 SEM coefficients.

Click to view original image

Figure 2 Path model. Source: Authors’ own estimation. Note: CR = critical ratio, FoCVD = fear of COVID-19, PoCVD = perception of COVID-19, EC = environmental concern, IC = innovation capability, EP = environmental performance.

7. Discussion and Conclusion

The COVID-19 outbreak not only affected the business, the environment and the economy but also devastated all segments of human lives. More importantly, this situation also severely affected the SMEs, where most firms remained unsuccessful due to the FoCVD, EC, PoCVD and unsatisfactory EP. The literature demonstrated the several constructs which affected the EP among several factors. However, the domain researchers needed to focus more on investigating the effect of FoCVD, IC, PoCVD and EC on EP among the managers of Saudi Arabia. Hence, to fill these gaps, the study aimed to investigate the effect of factors such as PoCVD, IC, EC and FoCVD on EP among the SME managers of Saudi Arabia during COVID-19.

The study developed a robust conceptual framework based on existing relationships and gaps in the study. We applied path analysis through analysis of moment structures (AMOS). In the study, path analysis underlines an insignificant negative effect of PoCVD on EP. These results are supported by numerous scholars like [3], [4] and [41], who found the incompetence of EP during the pandemic. According to the findings, COVID-19 was more dangerous than in previous waves because it resulted in a sharp decline in economic gains, uncertainty, anxiety, and fear, particularly among business owners, entrepreneurs, and managers [20,41]. More specifically, SMEs of Saudi Arabia remained under negative performance in terms of environment and business. The managers of SMEs massively failed to create strategies and policies to address problems [8]. Besides, some managers’ report having problems falling asleep when considering the epidemic. In a simple sense, PoCVD had left negative effects, adversely affecting the EP in SMEs.

Likewise, the results for H2 revealed an insignificant and negative effect of IC on EP, which concurred with [5], who found both the financial and non-financial performance in the service firms are severely affected by IC. However, the results are also not supported by [24], who claimed the positive role of IC as significant and positive towards EP in regular routines. However, present results showed a negative correlation between IC and EP during a pandemic. In these circumstances, the responders may want assistance refining their IC to offer quality EP. These undesirable outcomes require management to encourage green innovation while discouraging people from exercising their creative faculties. Due to COVID-19, they cannot provide management assistance to the organization. In their perception, SMEs need to be able to organize the available resources appropriately.

Furthermore, the path coefficients provided in-significant and adverse effects of EC on EP. These outcomes also align with the findings of [27] and [42], who came to the same conclusion about the negative effects of environmental issues and the lack of a substantial performance difference between manufacturing and service organizations. These problems might result in a wide range of decision-making circumstances. However, [43] find that environmental concerns are the driving force behind organizations' achievements, contradicting these findings. The negative relationships might imitate the managers' need to cultivate a green culture among the employees. They also need to pay attention to protecting the environment in daily operations. Finally, the managers must prepare to bring sustainable development to SMEs due to COVID-19 concerns.

Finally, the FoCVD factor also appeared as the insignificant negative predictor of EP. Likewise, these results are accorded with several scholars who provided empirical evidence of the negative connection between FoCVD and EP [2,23,44]. The results demonstrated that managers' emotional states are affected by FoCVD, resulting in despair and anxiety. The life danger posed by COVID-19 has SME managers terrified. As a result, EP was devastated [44].

To sum it up, overall results claimed a significant negative impact of PoCVD, IC, EC, and FoCVD on EP. The green innovation lowers the energy and resource usage of our company. Our company produces less trash and emits fewer pollutants thanks to green innovation. Green innovation lessens the environmental effect of our company's product lifecycle throughout the epidemic in Saudi Arabian SMEs.

8. Contribution, Limitations and Future Research Paths

Due to the study's completion during the unpleasant and terrible obstacles of the pandemic waves, its findings had a tremendous impact. The study's findings would give decision-makers and planners the information they need to improve EP. The study will help SMEs and environmental management understand the effects of fear, EC, and PoCVD, which eventually negatively influence EP. The study's findings offer ways to manage business worries and potentially damaging elements for various businesses during the COVID-19 pandemic. If the COVID-19 waves do persist, the research advises facing the difficulties. Due to the testing of a recently created corporate strategy model and the environmental viewpoint, particularly during the pandemic's waves, the research would also provide a unique contribution. Finally, the study's results would add to the body of knowledge in business, management, and environmental science, especially from the viewpoints of COVID-19.

There are several research limitations in the study. Only quantitative approaches that primarily rely on cross-sectional data are permitted for this study. The study used a single instrument (a survey questionnaire) to gather responses from Saudi Arabian SMEs online, utilizing a convenience sample technique. We did not use a relevant theory to support our conceptual framework. To deduce the results, we used SEM analysis. Finally, the data collection for our investigation was limited to COVID-19.

More longitudinal studies comparing the outcomes of the several COVID-19 waves must be conducted in the future. Future research should concentrate on the drive, entrepreneurial attitudes and intentions, lockdown results, and staying home to study EP. For examining the commercial and environmental problems during a pandemic, the forthcoming researchers may apply combined technique research (qualitative and quantitative) in the future. Future research should concentrate on large samples of business owners, workers, and employees to know the pandemic's additional consequences.


We are sincerely thankful to the Deanship of Scientific Research, Vice Presidency for Graduate Studies and Scientific Research, King Faisal University, Saudi Arabia for providing the funds. We also appreciate our respondents who gave their precious time for providing their valuable responses.

Author Contributions

Abdelwahed NAA developed the conceptualization framework and hypotheses of the study. Mohammed A. Al Doghan, MA developed the methods and write-up of the manuscript. Soomro BA analyzed the data and discussed the results in the light of literature. All authors accepted the final version after revisions.


This work was supported by the Deanship of Scientific Research, Vice Presidency for Graduate Studies and Scientific Research, King Faisal University, Saudi Arabia [Project No. GRANT3962].

Competing Interests

The authors have declared that no competing interests exist.


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