Institutionalising Sustainable Production Practices: Malaysia’s Solar Photovoltaic Industry

Abstract

The case study explores the role of institutions, their effectiveness, and their legitimacy in developing sustainable production practices over time. Set against the backdrop of government reforms in Malaysia’s emerging SPV industry, developing these practices requires a combination of particular macro-institutional conditions and policies. Although the new policies provide wide-ranging opportunities for many businesses, they also impose constraints on how businesses conduct sustainable production practices. Institutional theory points to the role of several factors in legitimising these practices, such as reducing uncertainty and information costs, pathways to transfer solar technology and knowledge, and providing better financial support. Institutional theory also calls into question how a wide array of actors at the macro-institutional level are able to conduct sustainable production practices. This question has two implications for those within the network: 1. How does sustainable production emerge over time and, by extension, what are: (a) the roles of the network actors; and (b) the actors’ effectiveness in driving business sustainability? 2. How do actors’ relational dynamics legitimise or delegitimise sustainable production practices? The case study explores these and other questions by tracing four key sustainable production practice indicators from the perspective of both institutional and network theory.