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Adoption of Voluntary Environmental Practices: Evidence from the Textile and Apparel Industry in Sri Lanka

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  • D. W. Kinkini Hemach
  • ra

Abstract

This study examines voluntary adoption of environmental management practices in the textile and apparel sector in Sri Lanka. The textile and apparel industry contributes to 58% of total industrial export earnings and 52% of industrial employment in the country. Factories in this sector undertake different production activities and the Sri Lankan Central Environmental Authority identifies washing and dyeing factories as significant contributors to water pollution. In this study, we review existing environmental rules and regulations that apply to the textile and apparel sector and follow up with an econometric analysis of data from a factory survey and a set of detailed case studies. Our sample covers factories that are registered with the Sri Lankan Board of Investment, which primarily gathers large-scale export-oriented companies operating in the apparel sector. Study findings show that 96% of the factories surveyed voluntarily implemented at least one environmental management practice such as water recycling, material re-use and environmental audits and certification. 69% adopted more than two practices. Most of the surveyed factories had been inspected by regulators, but had never been fined. Our analyses suggest that while factories are responsive to existing regulations, market pressure from international buyers may be the dominant reason why Sri Lankan firms adopt good environmental practices. The analyses also suggest that firm's size and type of activities undertaken are the most significant factors that influence decisions to voluntarily adopt environmental management practices.

Suggested Citation

  • D. W. Kinkini Hemach & ra, "undated". "Adoption of Voluntary Environmental Practices: Evidence from the Textile and Apparel Industry in Sri Lanka," Working papers 93, The South Asian Network for Development and Environmental Economics.
  • Handle: RePEc:snd:wpaper:93
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    References listed on IDEAS

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    1. Maxwell, John W & Lyon, Thomas P & Hackett, Steven C, 2000. "Self-Regulation and Social Welfare: The Political Economy of Corporate Environmentalism," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 583-617, October.
    2. Keren Priyadarshini & Omprakash K. Gupta, 2003. "Compliance to Environmental Regulations: The Indian Context," International Journal of Business and Economics, College of Business and College of Finance, Feng Chia University, Taichung, Taiwan, vol. 2(1), pages 9-26, April.
    3. Nakamura, Masao & Takahashi, Takuya & Vertinsky, Ilan, 2001. "Why Japanese Firms Choose to Certify: A Study of Managerial Responses to Environmental Issues," Journal of Environmental Economics and Management, Elsevier, vol. 42(1), pages 23-52, July.
    4. Foulon, Jerome & Lanoie, Paul & Laplante, Benoit, 2002. "Incentives for Pollution Control: Regulation or Information?," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 169-187, July.
    5. Jayasinghe-Mudalige, Udith K. & Weersink, Alfons, 2004. "Factors Affecting the Adoption of Environmental Management Systems by Crop and Livestock Farms in Canada," Sri Lankan Journal of Agricultural Economics, Sri Lanka Agricultural Economics Association (SAEA), vol. 0, pages 1-14.
    6. Dasgupta, Susmita & Hettige, Hemamala & Wheeler, David, 2000. "What Improves Environmental Compliance? Evidence from Mexican Industry," Journal of Environmental Economics and Management, Elsevier, vol. 39(1), pages 39-66, January.
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    Keywords

    Environmental Management Practices; Apparel and Textile industry; Sri Lanka.;

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