The Impact of Supplier Innovation and Competitiveness on Local Content Compliance: The Moderating Role of Firm Size in the UAE Oil and Gas Sector

This study examines the effects of supplier innovation and long-term competitiveness on local oil and gas content compliance, considering the United Arab Emirates (UAE) economic diversification and sustainability objectives and the moderating influence of firm size. Using a quantitative research design to survey 462 oil and gas suppliers in the UAE, and resource-based view (RBV) and institutional theories, we examined innovation, competitiveness, and local content requirements (LCRs) compliance. Long-term competitiveness and supplier innovation positively increase LCR compliance more optimally by larger suppliers, making firm size a key moderator. Special initiatives are necessary to support smaller suppliers, overcome resource constraints, and improve competitiveness. This study contributes to the literature by providing insights into the interplay between innovation, competitiveness, and policy compliance in emerging economies. We provide recommendations for improving supplier innovation, aiding smaller firms, and synchronizing LCR policies with sustainability objectives for policymakers and industrial stakeholders.