1. Presenter Dr. Aqueel Wahga
Overcoming barriers to environmental improvement in SMEs: Pragmatic policy options for Pakistan’s leatherworking industry
Presenter
Dr. Aqueel Wahga
Co-Authors
Prof. Richard Blundel
Dr. Anja Schaefer

2. Rationale for research
SMEs make a considerable contribution to economic growth.
Their environmental impacts are also noted to be significant (Wahga et al., 2018; Blundel et al., 2013; Parker et al., 2009).
For achieving Sustainable Development Goals (SDGs) various stakeholders are driving SMEs to reduce their environmental footprints (Vogt and Hassan, 2011; Gold, et al., 2010; Lund-Thomsen, 2009).
SMEs have started to take some environmental initiatives, but they face a number of barriers (Wahga et al., 2018; Murillo-Luna et al., 2011)

3. Rationale for research
Prior research has examined environmental barriers in both developed and developing economies
There is still merit in investigating these barriers in the context of developing economies.
Local and regional peculiarities leading to a different set of internal barriers.
Distinct institutional structures
Previously identified environmental barriers in SMEs cannot be accepted universally

4. Aim of this research
Investigate the barriers to environmental improvement in leatherworking SMEs of Pakistan, a developing economy context.
Offer pragmatic policy recommendations to overcome such barriers.

5. Leatherworking industry in Pakistan
Size-wise
More than 90% leatherworking units are SMEs (PTA, 2018)
Products of leather industry
Finished leather, leather apparel and clothing, leather gloves, leather footwear and some other leather products such as hand bags and belts.
Economic contribution
Third largest export earning sector (4.5%), after textile and rice [Economic Survey of Pakistan, ].

6. Environmental issues and practices of leatherworking SMEs

7. Theoretical Framework
A hybrid theoretical framework
help examine simultaneously both the internal and external factors limiting the environmental engagement of sample firms.
Resource-based view
(Eisenhardt and Martin, 2000; Barney, 1991; Wernerfelt,1984; Penrose,1959)
Can lend support to identify the absence of resources at the internal level that constrain environmental improvement in leatherworking SMEs
Institutional theory
(Scott, 2010; Oliver, 1991; DiMaggio and Powell, 1983)
To examine the institutional-level factors operating externally in the organisational field of leatherworking SMEs, and limiting their better environmental engagement.

8. Methodology Multiple case study design
Purposive and snowball sampling strategies
Semi-structured, in-depth, face to face interviews
35 interviews with different owners and managers from 22 SMEs
A number of other industry stakeholders were also interviewed, including cleaner production centres, industry associations and input suppliers
Grounded analysis using NVIVO, operationalised Gioia methodology (Gioia et al., 2013)

9. Internal environmental barriers in leatherworking SMEs

10. External environmental barriers in leatherworking SMEs

11. Environmental barriers faced by leatherworking SMEs in Pakistan
Internal barriers
Financial constraints
Labour related barriers
Area shortage
External barriers
Policy barriers
Infrastructural barriers
Societal barriers
Inconsistent support from some environmental institutions

12. Policy Recommendations
Addressing institutional gaps through
effective enforcement of environmental regulations
capacity building of environmental inspectors, while also increasing their salaries
Better governance of tannery clusters
Opportunity for collaboration between the management of effluent treatment plants and district governments for strict surveillance of environmentally non-compliant SMEs
Institutionalising cleaner production alongside adopting end-of-pipe treatment technologies
Raising eco-literacy skills amongst owner-managers and employees
Motivational push and informational support

13. Policy Recommendations
Raising the level of social accountability for SMEs
raising environmental awareness amongst general public, for example, through media campaigns
mobilise local communities to play an active role in promoting environmentally responsible businesses in the country – role of educational institutions
Consistent support needed from intermediary organisations, such as cleaner production centres and industry associations
Improvement in infrastructure
Constructing drains, roads etc.
Developing local chemical industry

14. Policy Recommendations
Access to finance
Opportunity for Islamic Banks
Central Bank’s role in directing commercial banks to offer environment-specific loans on relatively less strict terms

15. To conclude
If the proposed recommendations are operationalised successfully, it can help leatherworking SMEs
Survive in international supply chains
Achieve economic, environmental and social benefits simultaneously
Make a reasonable contribution towards achieving sustainable development goals

16. Thank you!