Role of regulation for firms to adopt environmental controls: an analysis based on panel data on solid waste management in agri-food processing sector in Sri Lanka

Utilizing panel data, this study incorporates time dimensions into the empirical analysis carried out by Jayasinghe-Mudalige and Udugama (2010) to explore the potential role of individual regulatory incentives, namely: (1) Existing Regulation (EGR) (2) Anticipated Regulation (AGR), and (3) Liability Laws (LBL) on the level of adoption of solid waste management practices (SWMPs) recommended by the Ministry of Environment of Sri Lanka (e.g. 3R system, Composting unit, Biogas unit, Good Manufacturing Practices) by agri-food processing firms in Sri Lanka. The data collected from a cross section of firms representative of the industry structure (n=146) through a structured questionnaire administered with environmental managers/owners during March 2012 to April 2013 (Stage II) were taken up with corresponding data collected from the same set of firms three years earlier (Stage I). A number of quantitative techniques were employed to analyze data, including: estimation of Mean Ranks; derivation of an Environment Regulation Responsiveness Index” (ERRI) the Paired t-test and the Chi-square tests. The results imply that firms operating in this sector do not consider the existing government regulatory framework as a promising factor governing their environmental responsiveness but they do rely on the potential role of liability laws to steer adoption over time. This calls attention for adjustments to policy tools on environmental quality management at local level incorporating closely monitored, persuasive, targeted programs to promote effective compliance within firms. DOI: http://dx.doi.org/10.4038/jepsl.v2i1.5751 Journal of Environmental Professionals Sri Lanka Vol.2(1) 2013 65-8