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DOI 10.35609/jber.2026.11.2(3)

Reference to this paper should be made as follows: Seman, N.A.A, Ahmad, A.R, Hussin, M.Z.A, Rehman, Z.U. (2026). Government Support as a Selective Moderator of Sustainable Farm Performance: Evidence from Malaysian Independent Oil Palm Smallholders, J. Bus. Econ. Review, 11(2), 144–155. https://doi.org/10.35609/jber.2026.11.2(3)

Received: July 16, 2026 | Accepted: September 30, 2026

Government Support as a Selective Moderator of Sustainable Farm Performance: Evidence from Malaysian Independent Oil Palm Smallholders
Noor Aslinda Abu Seman , Abd Rahman Ahmad, Muhammad Zakwan Abu@Hussin and Zahoor Ur Rehman
Johor Business School, Universiti Tun Hussein Onn Malaysia, 86400 Parit Raja, Batu Pahat, Johor, Malaysia
Koperasi Keluarga Legasi Hussin Berhad, Felda Penngeli Timur, 81440 Bandar Tenggara, Johor, Malaysia
Centre for Management and Commerce, University of Swat, Charbagh, Swat, Pakistan Abstract

Objective - This study aims to investigate the moderating effect of Government Support (GS) on the relationship between Sustainable Agricultural Practices (SAP) and multidimensional farm performance among independent oil palm smallholders in Malaysia. It also investigates the direct effects of SAP and GS use on economic, environmental, and social performance.

Methodology/Technique - The method used in this study was a quantitative approach in the form of a cross-sectional survey, with 315 independent smallholders as respondents. Partial Least Squares Structural Equation Modelling (PLS-SEM) was used to analyse the measurement model, direct effects, and moderating effects in the data.

Findings - The results indicate that SAP has a significant effect on environmental performance and social performance, but not on economic performance. The direct effect of Government Support on economic performance is significant and negative, and its moderating effect on the SAP–economic and SAP–environmental relationships is insignificant. However, GS does much to reinforce the link between SAP and social performance, suggesting that, institutionally, a stronger tie will be more effective for improving social sustainability outcomes than for improving economic and environmental outcomes.

Novelty - The study presents new empirical evidence on the functions of Government Support as a selective moderator rather than a universal driver of farm sustainable performance. It highlights the conditional policy support for sustainability among Malaysian independent smallholders.

Practical Implication - The results indicate that policy interventions need to be more targeted, including better community-based support, extension services, social capacity building, and economic support such as market access, certification, finance, and value chains.

Type of Paper - Empirical

Keywords: Government support, independent smallholders, palm oil sustainability, economic performance, environmental performance, social performance.

JEL Classification: Q01, Q12, Q18

URI: https://gatrenterprise.com/GATRJournals/JBER/vol11.2_3.html

DOI: https://doi.org/10.35609/jber.2026.11.2(3)

Pages 144–155

Price: USD 25