Abstract
Over the past decade, enterprises have sought to minimize their ecological footprints through cleaner production strategies. Evidence can be gathered to support either the view that adopting environmental management standards (EMS) is a cost burden on firms and is detrimental to competitiveness, or that adopting standards increases savings giving firms competitive advantage in the long run. To resolve this seeming paradox in an emerging country context, the relationship between adopting EMS certificate and resource efficiency is examined empirically using a panel sample of 1333 manufacturing SMEs in Vietnam for the (2011–2013) period. Applying an instrumental variable approach, the results indicate that certification leads to resource savings reflected by less use of electricity, fuel and water for each unit of output. Additionally, there is a heterogeneous effect of certification on the extent of resource saving depending on the sector of operation. The paper also highlights determinants of certificate adoption among SMEs which should be considered in the promotion of environmental certificates, especially in developing countries. To successfully roll out the adoption of environmental certificates on a larger scale, better knowledge among business owners on potential competitive and environmental sustainability gains from EMS must be disseminated.
Highlights
In recent years, the importance of shifting to more sustainable patterns of consumption and production has been globally recognized
Firms have experienced a fall in resources costs between 2011 and 2013, yet the share of those costs remained almost constant over time and constituted about 52% of the total indirect costs
The role of environmental management standards (EMS) certificates as effective tools to nudge producers towards sustainable production patterns is gaining interest in the literature; different aspects related to adoption barriers, incentives and outcomes of EMS certificates in emerging and developing countries still remain under-explored
Summary
The importance of shifting to more sustainable patterns of consumption and production has been globally recognized. Such transition requires policies capable of promoting the adoption of production systems. This would enhance the efficient use of resources and reduce the negative externalities associated with the life cycle of product manufacture. The country’s gradual transformation to a market economy is reflected in the shift from heavy industry to light industry, such as apparel, food and beverages, leather and wood products [46,47]. The Government of Vietnam has set out targets in its Socio-Economic Development Plan, where it aims to reach industrialized nation status by 2020 with a focus on a group of industries, such as machinery and equipment serving agriculture, automobiles and mechanical spare parts, and steel for production [49]
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
