IMPACT OF ENVIRONMENTAL ALTRUISM ON ADOPTION OF SOLID WASTE MANAGEMENT PRACTICES IN THE FIRM: CASE OF AGRI-FOOD PROCESSING SECTOR IN SRI LANKA

Abstract

This study examines empirically the potential relationship between the environmental altruism of a firm’s decision maker on environmental quality and the level of adoption of enhanced environmental controls by the firm using the special case of adoption of solid waste management practices (SWMPs) recommended by the Ministry of Environment of Sri Lanka to the agri-food processing firms in Sri Lanka. The data collected from 275 firms by means of an in-depth interview with the environmental manager/owner were used to formulate a Weighted Environmental Altruism Index (WEAI) to estimate the degree of altruism of the manager. The Count Data Model was specified to assess the relationship between altruism and levels of adoption of SWMPs. The results suggest that the degree of environmental altruism of these mangers was relatively low (i.e. 0.25, on an average, of the WEAI ranges from -1 to 1) and the level of adoption of SWMPs was very unsatisfactory (i.e. Mean 1.2 with 47% of non-adopters) showing no significant relationship between these two factors. This implies the importance of augmenting the perspective of a firm’s management beyond the profits through a collaborative action of the firm and other social institutions to make sure that the businesses will not be liable for the environment it operates.