This article analyses how Environmental Corporate Social Responsibility (ECSR) strategies may help to enhance innovation among small and medium-size enterprises (SMEs). We test our hypotheses over a large sample of 2,620 industrial SMEs in Spain. We find empirical support for ECSR driving innovation as measured by the innovative effort or R&D and its outcomes in terms of product and process innovation. In addition, we distinguish the effect of ESCR on innovation among innovative and non-innovativeSMEs. The effect is more intense for the later, suggesting an important role of ECSR on firms’ transformation. Our study contributes to the literature by analyzing the effect of ECSR in promoting innovation, as opposed to most studies that examine only on green-innovation. Besides, we examine the neglected research area of SMEs environmental strategies. Our findings on the instrumental value of ECSR related to innovation strengthen the business case of pro-environmental strategies, specifically for SMEs.