Empirical Evidence on Environmental Management Practices

Abstract

Organizations are paying greater attention to the environmental impact of their business activities, as external stakeholders such as shareholders, customers and policy makers are increasingly demanding improved environmental performance from firms globally. Clean production and green products have become important issues to manufacturers as the International Organization for Standardization (ISO) has produced frameworks such as the ISO14001 series. These standards are intended to provide organizations with the elements of an effective environmental management system (EMS) that can be integrated with other management requirements and assist organizations achieve environmental and economic goals.

Firms have adopted environmental management systems (EMS) due to mounting government and industry pressures, yet little data exists in terms of the implementation of and practices within EMS. This paper aims to improve understanding and generate empirical data on firm activities in environmental management practices. This research will examine the nature and levels of environmental management practices within the industrial coatings industry by surveying the primary supply chain within an emerging market context.

This paper employs a quantitative cross-sectional survey approach to provide empirical data from a sample of firms which have implemented an EMS. The study is executed in an emerging market country allowing for international comparisons in similar contexts.

For the purpose of this study the population comprised suppliers of industrial coatings raw materials and industrial coatings manufacturers operating within the broader chemicals sector in South Africa. This emerging market country context provides a unique environment with opportunities to expand theory. A diverse sample frame ensured heterogeneity in the final sample representing several value chain activities in this industry. The survey was administered electronically to key players in this industry, with a 64 per cent response rate, resulting in a final sample of 84 respondents. The study results confirm that larger organizations and/or multi-nationals that are involved in export markets are committed to higher levels of EMS practices. These companies are securing their long-term survival by ensuring that they meet global sustainability objectives. In addition, these mostly private companies are reassuring internal and external stakeholders with their commitment to environmental protection.

Based on a descriptive statistical analysis it is encouraging to note that a significant number of companies in this study have shown commitment to advancing environmental sustainability and have implemented a structured EMS. This EMS formed part of their mission statements and management practices at the corporate, manufacturing and operations levels were implemented.

The results also indicate that the majority of organizations surveyed have, to some extent, incorporated environmental management into the strategic process of the organization, which was done by employing environmental experts, ensuring that the environmental function was housed by a separate department and was incorporated into the strategic planning process of the organization. EMS reporting in annual financial reports is also an encouraging trend. This research has contributed to the evolving field of environmental management and has provided valuable insights as to the nature in which firms are practicing EMS.

Since the majority of respondents in the present study are multi-national companies it may be beneficial to expand this research to other countries with different regulatory obligations, to be able to compare and contrast EMS practices.

DOI: http://dx.doi.org/10.5755/j01.ee.23.2.1549