Fostering Environmental Performance Management within Indian SMEs

Fostering Environmental Performance Management within Indian SMEs

Gurudas Nulkar (Symbiosis Centre for Management and Human Resource Development (SCMHRD), Pune, India)
DOI: 10.4018/IJSITA.2016040101
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Abstract

Research and discussions on environmental sustainability of businesses generally focus on large corporations. Their environmental impacts are more likely to be noticed while small and medium enterprises (SME) are largely ignored. With a small scale of operations, SMEs are generally perceived to have less environmental impacts. However, as larger corporations outsource their manufacturing to SMEs the environmental burden shifts within their supply chain. This research was conducted within manufacturing SMEs in industrial markets (B2B) in Pune, India. In depth interviews with large and small firms helped develop the conceptual model and the questionnaire. Responses from 60 SMEs were analysed. The research identified factors like owner awareness, barriers and influencers to green practices and categorized environmental practices within product life cycle. The results showed that owners with high awareness levels had advanced environmental activities. The strength of barriers and influencers was established and the author makes recommendations based on these findings.
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Indian Sme Sector And The Environment

While SMEs have varying definitions in different countries, their characteristics are similar. Often these firms come into existence because of some particular expertise of the owner and are run single-handedly by them. Moreover, owners have low formal business experience (Deloitte, 2008). In this study the definition employed is from the 2006 Micro Small and Medium Enterprises Development Act (MSMED) of India. This defines and classifies SMEs on their investments in plant and machinery into micro, small and medium enterprises (Ministry of MSME, 2012).

Without being modest, the Indian SME sector is huge. An estimated 44.7 million units spread across a country of about 3.2 million square kilometres, inhabited by about 1.2 billion people living in 28 different states. They are significant contributors to employment, export earnings and the GDP. Their presence is a precondition for large industry, to which they serve as suppliers. This sector contributes to about 8% of the GDP, 45% of the manufactured output and 40% of exports (Special Task Force, 2010). Their sheer number alone makes offers a huge potential for improving the environment.

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