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Journal of Environmental Management 88 (2008) 275–285

www.elsevier.com/locate/jenvman

Issues for small businesses with waste management

Janice Redmonda,b,�, Elizabeth Walkerb, Calvin Wangb

aSchool of Management, Edith Cowan University, 100 Joondalup Drive Joondalup, WA 6027, AustraliabSmall and Medium Enterprise Research Centre, School of Management, Edith Cowan University, Australia

Received 25 May 2006; received in revised form 12 January 2007; accepted 17 February 2007

Available online 18 April 2007

Abstract

Participation by small and medium enterprise (SME) in corporate social responsibility issues has been found to be lacking. This is a

critical issue, as individually SMEs may have little impact on the environment but their collective footprint is significant. The

management style and ethical stance of the owner-manager affects business decision making and therefore has a direct impact on the

environmental actions of the business. Although adoption of environmental practices to create competitive advantage has been

advocated, many businesses see implementation as a cost which cannot be transferred to their customers. After a brief review of pertinent

literature this paper reports on an exploratory investigation into the issue. Results show that whereas owner-managers of small

enterprises express concern regarding the environment, this does not then translate into better waste management practices.

r 2007 Elsevier Ltd. All rights reserved.

Keywords: SMEs; Environmental waste management; Attitudes

1. Introduction

Attitudes toward environmental management have beenfound to be influenced by many internal and externalfactors such as: company size and resource availability,strategic attitude, sector, and geographic location (Fried-man et al., 2000; Gonzales-Benito and Gonzales-Benito,2006). Small business is defined as an organisation withmore than 1 and less than 20 employees and mediumbusiness has between 20 and 200 employees (AustralianBureau of Statistics, 2004). For the purposes of this paperthese businesses will be referred to collectively as smallbusinesses. These small businesses contribute to wastegeneration yet they appear not to be committed to wastemanagement practices. As much of the previous research inthe field has focussed on large business, business sizedifferences which impact on a small firm’s capacity toengage in waste management practices, such as their lowerlevel of resources and flatter management structure maynot have been given due attention. This omission may havecontributed to the lack of progress made in encouraging

e front matter r 2007 Elsevier Ltd. All rights reserved.

nvman.2007.02.006

ing author. Tel.: +6108 6304 2153.

ess: j.redmond@ecu.edu.au (J. Redmond).

small business to engage in waste management practices.Moreover, it is important to business and communitysustainability that small businesses are actively engagedboth in reducing the waste generated by their business andin implementing practices which appropriately dispose ofsuch waste.Owner-managers who have the decision-making power

in small businesses have expressed interest in the environ-ment yet this interest has not been translated into betterwaste management practices. As a consequence, the owner-managers of these businesses were surveyed to determinethe reasons for the disparity between expressed interest andinaction.Four factors were explored with the owner-managers: (a)

interest in the environment, (b) business impact on theenvironment, (c) current environmental management prac-tices and (d) awareness of local environmental matters. Thefirst factor was included to confirm that the participantsample was interested in the environment. The other threefactors were identified as having the capacity to explainboth the disparity between interest and inaction and/or toreveal attitudes which may contribute to a lack ofengagement by owner-managers. In particular, the owner-managers’ responses to these matters were considered

ARTICLE IN PRESSJ. Redmond et al. / Journal of Environmental Management 88 (2008) 275–285276

important indicators of their level of interest and commit-ment to environmental preservation.

Identifying attitudes that might affect engagement inpractices either to reduce or to effectively manage thebusiness impact on the environment is important for bothbusiness and community sustainability. In addition, wastevolumes were collected to explore the notion that smallbusinesses, as a collective, contribute substantially to theenvironmental footprint of society. The results of thisexploratory study provide a basis for future work toincrease small business engagement in effective wastemanagement practices.

2. Background

2.1. Business and environmental management

Globally, businesses are being asked to respond to theconcept of corporate social responsibility (Idowu andTowler, 2004; Longenecker et al., 2006; Quazi, 2003) andenvironmental management has emerged as a veryimportant issue. More specifically, due to its impact onthe environment and the community, pressure is mountingon businesses to more effectively manage and reduce theirlevel of waste (Department of Environment, 2005; Inter-national Chamber of Commerce, 2001; US EPA, 2003).

Australia currently consumes more resources and ‘‘pro-duces more waste than at any time in its history’’ and ‘‘is inthe top 10 solid waste generators in the OECD’’ (AustralianBureau of Statistics, 2003, p. 156). ‘‘In 1996–1997, landfillsin Australia received 21.2 million tonnes of solid waste,equating to a disposal rate of around 1.146 tonnes perperson, or 3.14 kg per person per day’’ (Australian Bureauof Statistics, 2003, p. 156). The various costs associated withmanaging this amount of waste exacerbates the issue andsupports the need for waste reduction through changes inconsumption and behaviour.

The International Chamber of Commerce (ICC) hasdesigned a Business Charter for Sustainable Developmentas a tool to help companies tackle the challenges andopportunities presented by the environmental issues thatemerged during the 1980s and 1990s. The Charter has 16key principles that provide a basis for good environmentalpractice. The first of these is the need for businesses torecognise environmental management as being among thehighest of corporate priorities and as a key determinant ofsustainable development (ICC, 2001).

2.2. Business size as an influence on environmental response

The level of recognition of the importance of environ-mental management does vary between large and smallbusinesses (Banerjee, 2001; Luetkenhorst, 2004; Sharma etal., 1999). This is partly due to the fact that environmentalmanagement, like many corporate social responsibilityissues, has primarily been practiced in the ‘‘domain of large

TNCs [trans-national companies]’’ (Luetkenhorst, 2004,p. 158).Gaps between theory and practice of corporate social

responsibility in small business are seen as stemming fromthe narrow research focus on large business. Thompsonand Smith (1991) advised that the narrow focus led toassumptions about small business involvement. For exam-ple, that small business has less opportunity to exercisesocial responsibility. Thompson and Smith (1991) sug-gested that as a consequence of the narrow focus on largebusiness there is a lack of information on how smallerbusinesses should manage corporate social responsibilitytasks and this is a major impediment to progress by smallbusiness.Understanding corporate social responsibility and en-

vironmental management practices predominantly from alarge business perspective and not from a small businessperspective is problematic as small businesses are notscaled down versions of big business (Burns, 1996; Keatsand Bracker, 1988). There are major distinctions betweenbusinesses of different sizes, primarily in their managementpractices (Jennings and Beaver, 1997). Worthington andPatton (2005, p. 197) assert that ‘‘what drives environ-mental behaviour of companies is an under-researched andunder-developed area of study, particularly in the contextof small and medium enterprise (SMEs)’’.The level of managerial and financial resources of small

business is related to the size of the business and this canhave both positive and negative influences on the capacityof the business to implement environmental strategies.Positive influences of business size have been provided byresearchers (Condon, 2004; Sarbutts, 2003; Wills, 2003).Condon (2004, p. 57) suggested after working in a series ofworkshops with a group of SMEs in Australia that smallbusinesses ‘‘have a major advantage over larger organisa-tions addressing sustainability issues—their size means thatthey can react very quickly to changes in the businessenvironment.’’ Moreover, Sarbutts (2003, p. 346) suggestedthat small business,

by being flatter [structure] and potentially quicker ontheir feet and without analysts and shareholders fixatedby price/earnings ratios, are better placed than majorcorporations to take advantage of the fact that societyand the media revere qualities such as honesty, integrityand the ability to say sorryy

Another positive for small businesses is that once anenvironmental strategy is decided upon, because of theirrelatively small staff numbers, the costs of learning the newroutine and renegotiating responsibilities will be less thanfor a large bureaucratic organisation (Wills, 2003). Thisdoes presume however that small businesses are willing toengage in training, which unless proven to be financiallybeneficial and operationally imperative is not always thecase (Storey, 2004; Webster et al., 2005a, b).Influences of business size which may have negative con-

sequences for implementation of environmental practices

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have also been highlighted in the literature (Condon, 2004;McKeiver and Gadenne, 2005). McKeiver and Gadenne(2005) found that the number of employees in a business isa driver of both internal and external factors that affect thelevel of adoption of environmental management. This is inpart due to the fact that if the business is very small the soledecision-making responsibility may rest with the owner-manager. Size therefore does matter in many instances andsmall businesses are economically important from a globalperspective, as they are the biggest sector by number inall economies. Small business in Australia, for exa-mple, accounts for 97% of all private sector businessesand is recognised as a major contributor to regionaleconomic growth and development (Australian Bureau ofStatistics, 2002).

Recent research on small business and environmentalmanagement has demonstrated that small business parti-cipation is critical for both economic reasons and toachieve sustainable development (Australian Bureau ofStatistics, 2002; Condon, 2004; Luetkenhorst, 2004; USEPA, 2003), yet engagement is lacking (Hillary, 2000 citedin McKeiver and Gadenne, 2005). As business involvementin environmental management is a relatively new businessissue, literature about small business response to thischallenge has only recently emerged.

2.3. Resources and attitudes as influences on small business

response

While many barriers to small business engagement inenvironmental practices have been raised by researchers(Condon, 2004; Luetkenhorst, 2004; Simpson et al., 2004;Worthington and Patton, 2005), two issues appear to havethe most influence. These are the level of resourcesavailable and the prevailing attitudes of the small businessowner-managers.

A business resource in this instance refers to under-capitalising, being owned and managed by the sameperson, and having few employees. In addition, manysmall businesses are characterised by informality, poorinformation systems, being operational rather than strate-gic in their decision making and being time poor (O’Gor-man, 2000; Wang et al., 2007; Webster et al., 2005a,b).These characteristics all contribute to the difficulties ofimplementing good environmental management practicesin small businesses, even if the owner-manager attitude ispositive.

An example of the impact of limited resources can befound in the recent literature which has investigated formalimplementation of environmental management systems.Williams et al. (2000, p. 106) when discussing theimplementation of environmental self-regulation systemsadvised that, ‘‘much of this development y has been inlarge, well-resourced firms. SMEs have not exhibited thesame level of commitment to these new managementtools’’. These results affirm the disparity between the levelsof resources available to implement environmental strate-

gies that large business may have compared with smallbusinesses. Williams et al. (2000) also draw attention to thedifference in commitment by businesses to environmentalpractices. The difference in commitment by small businessmay be due to the fact that in these businesses decisionsabout the commitment of resources are made by the owner-manager.The influence of the manager is central to all business

operations as ‘‘there is a critical relationship betweenplanning in small firms and the strategic-awareness cap-ability of the owner-managery’’ (Hannon and Atherton,1998, p. 114) and ‘‘this appears to be strongly influenced bythe personal competence of the owner-managers and thetype, uncertainty and complexity of the business.’’ Smallbusiness owner-managers are known to implement informalrather than formal management practices and to thinkoperationally rather than strategically (Jennings and Beaver,1997; Upton et al., 2001; Wang et al., 2007). In practice, thismeans that most small business planning at all levels is at theoperational or functional level and involves the day-to-dayconcerns of running a business and its survival (Long-enecker et al., 2006; Shrader et al., 1989; Upton et al., 2001).The majority of small businesses operate on a survivalmanagement culture rather than a strategic managementculture, making long-term operational changes difficult toaction as they require a level of forward thinking. Therefore,as asserted by Luetkenhorst (2004, p. 164) small businesseswill be ‘‘more dependent on direct economic benefits ofCSR-oriented strategies.’’ This need for small business togain direct benefit from the use of their limited resources isconsidered a key trigger to encourage environmental action.Indeed, Williamson and Lynch-Wood (2001, p. 431)suggested that a more proactive model is needed after theyfound that ‘‘low commitment levels (i.e., attitudes) [toenvironmental practice] are supported and reinforced byreactive practices.’’Another influence on the use of business resources for

environmental management is the owner-manager’s ethicalstance on the environment. Hornsby et al. (1994, p. 9)noted that among small business owners, ‘‘it is apparentthat an owner’s value system is a critical component of theethical considerations that surround a business decision.’’Karp (2003, p. 15) has suggested that, ‘‘in an increasinglycomplex environment, the integrity of the single businessleader will mattery’’Small business owner-managers have many diverse

demands on their time and finances. This means thathaving the opportunity and resources to evaluate environ-mental practice options can be more difficult than it wouldbe for larger businesses (Wills, 2003). To compound thisproblem owner-managers often lack the managerial skillsrequired to implement practices outside of their technicalexpertise (Webster et al., 2005b). Therefore, implementa-tion of environmental management strategies may chal-lenge the owner-manager’s managerial expertise, ethicalstance and their capacity to apply, monitor and evaluatethe outcomes of these practices.

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While some small businesses do not see environmentalissues as important (Condon, 2004), most see them asaffecting their business (Simpson et al., 2004), however,this has not always encouraged engagement (Petts et al.,1998; McKeiver and Gadenne, 2005). Another impedimentidentified by Simpson et al. (2004) was that the owner-managers’ view that the costs of managing these mattersare not able to be passed onto customers. As aconsequence, only a few sought advice about how toreduce the environmental impact of their business. Thescant empirical evidence would suggest that whilst owner-managers of small businesses perceive there to be a cost tochanging any operational practices to be more ‘‘environ-mental’’, they are unlikely to make any actual change, thusperpetuating a belief that good environmental practice hasa negative effect on the bottom line. Simpson et al. (2004)concluded that the businesses often did not realise thepotential of environmental improvements to reduce costsor improve profits. These attitudes, derived from perceivedeconomic implications, contribute to small businessesresistance to reducing the impact of their business(McKeiver and Gadenne, 2005).

In addition, small businesses often have a limitedamount of one type of waste and this may contribute toan attitude that suggests that their environmental ‘‘foot-print’’ is negligible. It is considered, however, that thecollective impact of SMEs on the environment is consider-able and could outweigh that of large companies (Hillary,2000 cited in McKeiver and Gadenne, 2005; Rajendran andBarrett, 2003; Williamson and Lynch-Wood, 2001). Whensmall businesses do not see their business as having a highimpact on the environment (McKeiver and Gadenne, 2005)this may further deter them from engaging in environ-mental activities. Attitudes that support the notions thatbusinesses with small quantities of waste products are notimportant, or do not need to implement good environ-mental practices, oppose effective waste reduction anddisposal.

When small businesses respond to environmental man-agement issues, they are most often reactive, defensive andfrequently limit their response to legislative requirements(Revell and Blackburn, 2004; Worthington and Patton,2005). Often small businesses do not comply withcompulsory regulatory requirements (Rajendran and Bar-rett, 2003) or even take the time to understand legislativerequirements that affect them (Condon, 2004). This said,some small businesses have been shown to have moderateto high ‘‘environmentally friendly attitudes’’ (McKeiverand Gadenne, 2005). Moreover, adoption of environmen-tal practices improves with management-level support(Friedman et al., 2000; Gonzales-Benito and Gonzales-Benito, 2006; Worthington and Patton, 2005) and attitudesto the environment improve with the adoption of environ-mental management systems (Hillary, 1999 cited inMcKeiver and Gadenne, 2005). Two empirical studiesprovide examples of owner-managers responding to thecall to address the waste impact of their businesses.

First, a UK study by Simpson et al. (2004, p. 163) onSMEs found that 73% of respondents ‘‘were using or hadused environmental services for waste management.’’ Thisdemonstrated that some level of waste management practicehad been embedded into their operational strategies. Thisfigure was also much higher than for all other environ-mental practices (e.g., water management—35%; energyefficiency—49%). In fact, Simpson et al. (2004, p. 166)reported that the majority of the businesses ‘‘believed that‘waste was money’ and had a good housekeeping approachto its management’’, particularly those in the manufactur-ing companies as they appeared to have an interest in thecost savings to be gained from waste reduction.Second, in a small sample of Australian SMEs,

McKeiver and Gadenne (2005) examined the variousfactors that influenced the implementation of environmen-tal management systems and identified both formal (i.e.,engaged in a formal certification process) and informalpractices (e.g., changing business processes to reducewaste). Formal implementation was found to be enhancedby ‘‘education, legislation, and awareness’’ and informalimplementation by ‘‘yage, customers and employees’’(McKeiver and Gadenne, 2005, p. 513). As with otherstudies, only some of the businesses had engaged with27.1% informal and 11.4% formal implementation ofenvironmental management systems.The results of both studies from the UK and Australia

(Simpson et al., 2004; McKeiver and Gadenne, 2005,respectively) are encouraging and confirm that there isinterest in effective waste management among some of theowner-managers of small businesses. However, the resultsalso point to the need for government, employer, employeeand community involvement to improve engagement.Competitive advantage has been promoted as a reason

for encouraging the engagement of small businesses inenvironmental management practices. However, for thesebusinesses in the UK attempting to meet the requirementsof environmental issues Simpson et al. (2004, p. 156) foundthat ‘‘few organisations could show that it led to acompetitive advantage.’’ Therefore, the ability to pre-sent the business case for implementing good environmentalpractices would seem to be considered critical in influencingsmall business owner-managers to decide to participate.

2.4. The business case for environmental management

practices

It has been suggested that there is no conclusive evidencethat environmental strategies have a positive effect oneconomic performance for business (Longo et al., 2005;Naffziger et al., 2003). If there was no proof of improvedeconomic performance then small businesses could beexcused for not allocating their limited resources toenvironmental practices as they already have substantialcompetitive business pressure on them to survive. However,recent research in this area has provided more evidence tosupport implementation to gain competitive advantage.

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Arguments for business to adopt environmental manage-ment practices have been made from many differentstandpoints including: successful market niches and thedevelopment of strong consumer loyalty from so-called‘‘green consumers’’(Isaak, 1998), operational cost savings,enhanced staff loyalty, improved government relations,innovation and learning, enhanced reputation, and con-sumer response (Luetkenhorst, 2004). Moreover, Karp(2003, p. 19) proposed that there is sufficient evidence forthe business case and stressed that even though there is stilldebate about whether financial performance can beenhanced ‘‘there has been no evidence that social respon-sibility does not pay back in any form.’’

Perhaps some of the confusion regarding the potentialbenefits of adopting environmental strategies may beallayed with education as Simpson et al. (2004, p. 160)have suggested that, as many small businesses do notrealise the benefits that can be gained from pursuingenvironmental improvements, ‘‘there is an opportunity forsupport services, regulators and stakeholders to raiseawareness of environmental issues as they relate tobusinesses, evidencing cost savings and encouragingbusinesses to become more sustainable.’’ Luetkenhorst(2004, p. 158) goes further by stating:

At the end of the day, CSR will only prevail and remainan important force if SMEs can be effectively engagedand if CSR can be shown to impact on the developmentagenda, i.e., first and foremost on enhancing productiv-ity as a long-term determinant of economic growth.

In summary the literature indicates strong support forsmall businesses to implement effective environmentalmanagement practices to gain competitive advantage andsustain both the business and the community. This doeshowever require the allocation of resources by the smallbusiness owner-manager to engage in good environmentalpractices. The literature has shown that one difficulty forsmall business owner-managers is that they have limitedresources and it appears that the assumption is that theseresources will be allocated to environmental managementonly if the business case can be made. While this may be thecase, existing attitudes which reduce the importance of theenvironment may prevent this from occurring. Therefore, itis important to understand the current attitudes of smallbusiness owner-managers which affect implementation ofenvironmental management practices.

3. Methodology

3.1. Aim

The aim of this research was to test the following twopropositions:

1.

That owner-managers of small business would expressinterest in the environment yet this would not necessa-rily translate into better waste management practices, as

action would be influenced by the owner-managers’attitudes and awareness of the local environment.

2.

That the volume of waste generated by small business inone industrial area could be extrapolated to indicate thecollective impact on the environment of all smallbusinesses is considerable.

3.2. Research questions and design

As this was an exploratory investigation, the researchdesign incorporated quantitative methodology to collectcategorical data from the small business owner-managers.In addition, qualitative data was collected to provideexplanation of barriers which might be influencing theowner-managers’ decisions to engage in waste managementpractices. To examine the two research propositions, themain research questions were:

1.

What are the small business owner-managers’ currentattitudes toward the environment?

2.

What barriers did owner-managers experience whichlimited their engagement in waste management prac-tices?

3.

What is the approximate volume of waste produced bysmall businesses in this area in one week?

The owner-managers’ interest in the environment,whether they thought their business had an impact on theenvironment, the current environmental managementpractices within their business and their awareness of localenvironmental matters were also explored.

3.3. Survey instrument

Preliminary meetings with the stakeholders led to thedevelopment of a survey instrument which was piloted witheight small business operators in the industrial area. Afteranalysing the pilot data further input from professionalsworking within local environmental management organisa-tions was sought and the survey instrument refined. Adecision was made not to include the data collected fromthe pilot study beyond this point as some survey itemsdiffered and therefore the results were not directlycomparable.The final 30 item instrument consisted of a mixture of

questions which related to the business (e.g., What is yourbusiness?), the environment (e.g., Are you interested in theenvironment?), waste management (e.g., What type(s) andapproximate volume of waste is produced and disposed ofduring your business operations each week?) and the localenvironment (e.g., Where do the local stormwater drainsflow?). Three answer formats were used in the survey, yes-no, multiple-choice and longer answer format. Prior toconducting the main survey checks of the instrument forboth face validity and content validity were made (Cavanaet al., 2001).

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Table 1

Profile of the owner–manager

Gender (%) Age (%) Highest

education (%)

Male 85

Female 15

Under 30 5

31–40 18

41–50 30

51–60 35

Over 60 12

High school 33

TAFE 13

Trade 34

University 20

J. Redmond et al. / Journal of Environmental Management 88 (2008) 275–285280

The survey instrument was taken by hand to the totalpopulation of business owner-managers in an urbanindustrial area (147�8 pilot respondents ¼ 139) over theperiod November 2005 to February 2006 (breaking for 1month prior to and after Christmas). This area is one ofseveral small light industrial areas located within themetropolitan area of Perth, Western Australia. The localarea is experiencing rapid growth and impacts on theenvironment from industrial pollution sources have beenreported in the light industrial area in recent years. Thusthe light industrial area was selected as an appropriatelocation for this investigation due to its small size andenvironmental history.

The business owner-managers were given details regard-ing the purpose of the study and advised that participationwas voluntary. This methodology provided an excellentparticipation rate (86%) as 120 businesses agreed toparticipate.

3.4. Data analysis

As this was an exploratory study frequencies werecalculated from the categorical data collected to investigatethe owner-managers’ interest, knowledge and practice ofenvironmental management. In addition, the volume ofwaste generated and costs associated with recycling thewaste were also collected. Where we report volume ofwaste products the data has been reduced as far as possibleto provide a meaningful response. For example, steelvolumes were collected in many different volume capacitiesto allow the respondents to provide the data in their owncontext and therefore included cubic metres, tonnes, tons,and kilograms. The Australian Government nationalmetric conversion tables (Department of Industry, Tourismand Resources, 2006) were utilised to reduce the data totwo types of volume (i.e., cubic metres and tons).

Qualitative data was collected to identify the barriers toengagement in waste management practices. The barrierswere categorised into internal or external factors to identifythe location of the difficulty.

4. Results and discussion

After providing the contextual data for the study, thetwo propositions that were tested in this research arediscussed in relation to their implications for small businessengagement in environmental waste management.

4.1. Contextual data

Profiles of the owner-managers who contributed the dataand information of their businesses are shown in Tables 1and 2.

The demographic profile of the business owner and thebusinesses are consistent with light ‘‘industrial’’ areas inAustralia and elsewhere. That is, the types of businesses arestill dominated by independent older male owner-opera-

tors, with trade related skills, operating at a micro level(i.e., under five employees). This profile needs to be bornein mind when strategies are suggested to deal withenvironmental issues, as this cohort can be one of themost difficult to engage in regard to behaviour change. Itis, however, the very group that collectively is responsiblefor a high level of industrial waste.

4.2. Proposition 1

4.2.1. Small business interest and implementation

It was necessary before testing Proposition 1 to confirmthat this sample of small business owner-managers wereinterested in the environment before an assessment couldbe made of whether this would then translate into betterwaste management practices.The results confirmed that these owner-managers were

interested in the environment, with a positive responsegiven by 98% of respondents who rated environmentalissues as important or very important. These resultsprovide the basis on which to test the first proposition ofthe study and they are consistent with other research(McKeiver and Gadenne, 2005; Simpson et al., 2004;Williams et al., 2000).Owner-managers with a strong commitment to the

environment were expected to have measures in place toensure that they disposed of their waste appropriately.Therefore, their actions toward waste management wereprobed (e.g., having measures in place to prevent wastewater polluting the environment). Waste water was a focusin the study as the industrial area under scrutiny isextremely close to a major waterway and as such, wastewater disposal is a critical local environmental issue.When the owner-managers were asked whether they had

prevention measures in place for waste water produced bytheir business, 58% advised they did not produce wastewater. Of those who produced waste water 69% hadprevention measures in place and the other 31% did not.The potential for even a small amount of mismanagementby these owner-managers could cause environmental harm

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Table 3

External and internal barriers to recycling

External barriers Internal barriers

Cannot even give away Already recycling as much as

possible

Cannot recycle Cost

Shire does not recycle all products Lack of knowledge

Lack of facilities Not always viable

Advice of bin supply Sorting material

Lack of government support Space

Lack of bins and/or bin space Time

No notification of Shire recycling Willingness of staff to comply

Locating a suitable contractor

Unreliable storage

Table 2

Profile of the businesses

Type business by (%) Structure (%) Premises (%) Employees (%)

(ANZSIC code)

Agriculture 3

Mining 1

Manufacturing 25

Motor vehicle services 24

Other service 12

Production 3

Retail trade 17

Technical services 4

Transport and storage 4

Wholesale trade 6

Independently owner 89

Subsidiary or branch 8

Head office 1

Franchise 2

Leased 50

Owned 50

Full time staff

1 only 20

2–5 54

6–19 19

20 and over 7

Note: Where totals do not add to 100% no response was given.

J. Redmond et al. / Journal of Environmental Management 88 (2008) 275–285 281

as the area lacks deep sewerage. In addition, the majorityof the businesses (59%) were unaware of where thestormwater drains flowed. Without measures in place,any polluted water flows directly to the natural waterways.

Together, a lack of prevention measures and a limitedawareness of facts about a key contributor to ensuringliquid waste is disposed of correctly, show that the owner-managers’ commitment is somewhat at odds with theprevious high acknowledgement of the importance of theenvironment. These findings support the contention statedin Proposition 1 that the owner-managers’ interest in theenvironment would not necessarily translate into betterwaste management. This environmental rhetoric versusbusiness reality concept is often explained by the barriersthat small businesses face in pursuing good environmentalmanagement practices.

Part of the reason for this gap between interest andpractice may have been identified in another piece ofevidence that supported Proposition 1. The owner-man-agers were concerned about general impacts on theenvironment (99%) however, their interest was due to theimpact on their family (63%), thus making it a personalrather than an economic reason. If their interest in theenvironment is based on family protection rather thanenvironmental preservation this could account for some ofthe lack of engagement by these businesses, which is anarea for future research.

4.2.2. Small business impact on the environment

Many of the small businesses owner-managers (61%)acknowledged the impact of their business on the environ-

ment. Unfortunately, a considerable number of the smallbusiness owner-managers did not see their business ashaving an impact on the environment. This result providespartial support for the statement in Proposition 1 that theowner-managers’ attitudes may influence their action.Importantly, the result indicates that there is a need todemonstrate to the small business owner-managers howtheir business has an impact on the environment.

4.2.3. Small business barriers to engagement in recycling

waste

By gathering qualitative data additional barriers to thoseidentified in the previous literature were revealed. Table 3illustrates that the owner-managers saw the majority of thebarriers to be external (59%), with only 26% identifying aninternal barrier to recycling.

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The nature of the external barriers calls for both greatersupport from government and others responsible forenvironmental management and an increase in co-opera-tion between those organisations and small business.However, it can be argued that the internal barriers areof greater concern because these can be more difficult tochange. While some are inherent to small businesses (i.e.,time, space) many of these are a matter of perception and/or attitude (doing as much as possible, cost, willingness,lack of knowledge, sorting materials). Further education ofowner-manager about the benefits to their business ofimplementing good environmental practices may result incritical changes being made within the workplace to reducethe internal barriers to participation.

4.3. Proposition 2

4.3.1. Environmental impact of waste by small business

The second proposition to be tested was that the volumeof waste generated by small business in this industrial areawould indicate that the collective impact on the environ-ment of all small business is considerable. Table 4 providesan overview of the main types and approximate volume ofwaste produced in the area per week from the 120 smallbusinesses. As can be seen, over 350 cubic metres of wastematerial and 3500 litres of liquid waste is being generatedin this small industrial area each week.

When viewed on an annual basis these weekly amountsconvert to over 18 000 cubic metres of waste material andover 184 000 litres of fluid. The majority of the liquid fromthis area was waste oil which generated approximately180 000 litres per year from this area. This is equivalent tofilling between two and three domestic swimming pools peryear (based on a 50 000–70 000 litre pool capacity) or three

Table 4

Type and volume of waste produced by SMEs in one week

Product Vo

Cu

Metals

Steel 2

Cardboard

Packing material, boxes and paper 17

Plastics

Including polystyrene, 14

containers, bags,

packing film, and vehicle parts

Wood

Including pallets, MDF, 1

solid timber, and particle board

Batteries

Rubber

Tyres

Liquids

Waste oil

Radiator coolant

Note: Amounts have been rounded off to nearest full number.

sea containers (based on 40 ft dry cargo Hi-cube container).‘‘Used oil is a valuable resource. Even though Australiansare good at recycling used oil (around 194 million litres wasrecycled last year), at least 60 million litres of used oil goesmissing annually’’ (Department of Environment andHeritage, 2005, p. 1). In addition, the potential danger isobvious when it is known that ‘‘oil is also a pollutant: ittakes only one litre of oil to contaminate one million litresof water (which is about half the size of an Olympicswimming pool), and a single automotive oil changeproduces four to five litres of used oil’’ (Department ofEnvironment and Heritage, 2006, p. 1). While it is notbeing suggested that small business owner-managers areresponsible for the problems associated with oil used invehicles, it is important that when they, like others, use oilor service vehicles that the oil is disposed of correctly.With the potential for multiplication of the generated

waste by many other similar small businesses in Australia,these results suggest support for Proposition 2. Unfortu-nately, as reported by Bremner (2006) it is difficult to makeclear conclusions about the collective impact on theenvironment of all small businesses as there is a lack ofwaste and recycling data available in Western Australia.Therefore, while more data will need to be collected usingother samples, this research provides initial support thatHillary’s (1999, cited in McKeiver and Gadenne, 2005)contention that small business operations have a substan-tial impact on the environment may be correct.

4.3.2. Competitive advantage from waste management

While not a specific aim of the study, the notion thatsmall business will be interested in participating in wastemanagement strategies when they can see a direct benefitwas supported by the results of this research. The evidence

lume

bic metres Tons Units Litres

6 117

1

4

2 40

35

420

3288

265

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for this was given by some of the owner-managers thatprovided details on products that were both recycled andwere income generators for their business. However, thosewho did not make a competitive advantage also engaged.An explanation of why the small businesses may havechosen the path they did is provided and then it issuggested that those who are not gaining advantage shouldbe assisted to achieve benefits for their participation.

Strategies to gain benefit from recycling efforts of thebusinesses varied. Some businesses had a defined procedurefor waste disposal and therefore reaped the commensuratefinancial benefit, while others simply accepted whateverfinancial benefit they received from removal contractors.More worrying was that other owner-managers paidcontractors for the same sort of waste to be removed fromthe business premises. This provides further evidence thatmany small businesses work at a survival/operational levelrather than planning strategically, and that this can havenegative economic consequences for the business. Threeexamples are given to provide illustration of the results ofthe different approaches used by the owner-manager.

Steel is one of the most economically valuable productsto recycling contractors, yet the benefits reported by thesmall businesses ranged from a cost to the business forremoval, to an income of $A90 per tonne.

Paper when given to recyclers also cost some businessesyet others received $A38 per load. In this industrial area,171 cubic metres of cardboard and paper products wererecycled. According to Visyboard (2006) it is estimated thatevery ‘‘one tonne of recycled paper or cardboard saves:approximately 13 trees, 2.5 barrels of oil, 4100 kWh ofelectricity, 4 cubic metres of landfill and 31 780 litres ofwater.’’ In addition, other broad effects on the environ-ment are evident in paper manufacturing processesincluding the production of significant quantities of wastewater (Thompson et al., 2001). Recycling can assist in thereduction of these effects on the environment.

A third example is oil recycling, where some businesseswere paying to have oil removed while others werereceiving up to $A40 per drum for their waste oil. At thehighest resale value given ($A40 per drum), the marketrecycle value of the collective annual oil production fromthe small businesses within the industrial area is approxi-mately $A36 000. While it is acknowledged that this is not agreat deal of money, when the average annual turnover of asmall business in Australia ranges from $A82 000 to 1.08million (ABS, 2002), loss of any profit should be importantfor those at the lower end of the scale. Moreover, recoveredwaste oil can be recycled and approximately 80% of this oilreused. Therefore, this resource is not only of someeconomic value to small businesses, the recycling effortsare critical particularly in the 21st century when greaterpressure is being placed on the availability of thesecommodities due to growing consumption rates globally.

These figures indicate that some businesses gain compe-titive advantage and contribute to the community byimplementing good waste management practices and some

do not. The owner-managers’ views also highlighted thatthey were often unaware of what happened to the productsonce they were given to the recycling contractors and nolonger ‘‘their business’’. Combined, the evidence ofdifferent economic return for generated waste and lack ofawareness of where waste is disposed of after it leaves thebusiness premises provide opportunities for local environ-mental organisations to work with the business owner-managers and waste removal contractors to provide thebest outcomes for the business, the community and theenvironment.

4.4. Summary of results

The results indicated support for Proposition 1 that theirinterest in the environment would not necessarily translateinto better waste management as a limited number ofbusinesses had implemented prevention measures to ensurethat they disposed of their waste appropriately.It was also established during the testing of Proposition 1

that the owner-managers are more interested in theenvironment for personal rather than economic reasons.This may confuse the research on environmental practicesby small business as the assumption may be that by sayingthat they are interested in the environment they mean thatthey are interested in preserving the environment and thismay not be the case.Partial support was provided that the owner-managers’

actions were being influenced by their attitudes andawareness of the local environment. This was manifest inthree results. First, the majority of owner-managers had anattitude that their business had no impact on theenvironment. Second, the internal barriers identified bythe owner-managers to engagement related to perceptionsand/or attitudes. Third, the owner-managers’ low aware-ness of local environmental matters which assist appro-priate waste disposal indicated a lack of commitment to thelocal and global environment. Each of these was consid-ered to be a contributor to inaction. Although only partialsupport was given here, it is considered that their attitudesand awareness did influence their actions. However, there isinsufficient data to measure the link between thesevariables.Proposition 2 was supported by the research findings as

the total volume of waste generated in this one industrialarea supported the view that small businesses as a collectivemay have a considerable impact on the environment andthis impact could outweigh that of large companies.

5. Conclusion

Sustainable business requires an appropriate response tochange and in today’s society, environmental issues havebecome critical as it is recognised that the outcomesachieved in environmental management areas such aswaste management will have an important impact on thelocal community.

ARTICLE IN PRESSJ. Redmond et al. / Journal of Environmental Management 88 (2008) 275–285284

The importance of both small businesses and soundenvironmental management to the growth and sustainabilityof developed countries has been acknowledged and as theenvironmental fragility becomes more apparent, it is theobligation of everyone to take responsibility. Some inroadshave already been made on environmental matters by bothlarge and small businesses, however, more needs to be doneto encourage greater commitment by small business toengage with the local community in which they operate.

The literature has shown that small businesses haveseveral advantages over large businesses that could enablethem to address the environmental impact of the wastegenerated from their business. However, it is still not clearhow great the gap is between their interest in theenvironment and their day-to-day practices to reduce theimpact from their business operations. There still appearsto be an element of rhetoric versus reality among smallbusiness owners and little progress has been made abouthow to bridge this gap.

The attitudes of small business owner-managers havebeen shown to have an influence on what happens in theirbusiness and on the decision to participate (or not) in anywaste management practices. The evidence is growing that,by implementing environmental management practices,lasting economic benefits can be made and that thesepractices can create competitive advantage. Small businessesneed to be made aware of this and further evidence willcontinue to be needed to prove the business case to smallbusiness owner-managers. An approach to education of thissector is also needed that will provide the owner-managerswith knowledge about how to make appropriate changes intheir business to take advantage of the benefits. It issuggested that when the education programs are developedthey consider the perspective of the small business owner-manager and emphasise the benefits to be derived fromincorporating business environmental strategies.

A snapshot of the current attitudes of owner-managersregarding waste management practices in one industrial areahas been provided to illustrate their influence on theimplementation of environmental management practices.Increasing engagement by these and other small businessowner-managers to reduce waste and implement goodenvironmental management practices is crucial to localand national economic and social outcomes. It is clear thatthis will need the co-operation of government, businessesand the local community to initiate and sustain the changesnecessary to create and maintain a sustainable environment.

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