How environmental management driving forces affect environmental and economic performance of SMEs: a study in the Northern China district

Abstract

Small- and medium-sized enterprises (SMEs) form the core of societal and economic development. However, most people query on the implementation and performance of environmental management. In this paper, the manufacturing SMEs in Northern China with different pollution levels are studied to explore the main forces (e.g., government, society, market, and enterprise itself) driving SMEs for promoting environmental management. It focuses on the correlation between environmental management and economic performance for SMEs at different pollution levels. The results show that SMEs of different pollution levels have significant differences in the relationship of driving forces and performance. First, for SMEs with high-pollution levels, social and market driving forces and government incentives are revealed having a significant effect on their environmental performance. Driving forces from within the enterprise itself and the market provide a positive effect on the economic performance, while social forces have a negative effect. Second, for SMEs with light pollution, social and market driving forces, and government assistance play a supporting role on corporate environmental performance improvement. It is also found that the driving force of the enterprise itself does not have a significant effect on the environmental performance for SMEs with different pollution levels. In addition, the environmental performance and economic performance for SMEs with high or light-pollution levels are positively correlated. Further, it shows that the environmental performance is moderately correlated with financial indices, but not significantly with the non-financial indices.