Abstract
This empirical study examines the structure and functioning of social norms in challenging environments, specifically in the context of Nigerian small and medium-sized enterprises (SMEs). The research delves into the ways in which social norms are established and maintained, as well as how they affect the behaviour of entrepreneurs and their businesses. By analysing data gathered through interviews and observations, the study provides insights into the intricate mechanisms through which social norms operate in challenging environments. The findings suggest that social norms serve as powerful tools for regulating behaviour and promoting trust, particularly in contexts where formal institutional arrangements are weak or absent. Our research contributes to the understanding of the role of social norms in SMEs operating in challenging environments, and provides important insights into the factors that facilitate or hinder the development and maintenance of these norms.