Impact of adoption of green technology (ISO14000) on the firm productivity (TFP)
Student name: Ms Kirti Prabhakar
Guide: Dr Ritu Mathur
Year of completion: 2016
Host Organisation: TERI University
Abstract: Environmental issues are gaining increasing amount of importance in a large number of industries due to growing environmental concerns and awareness. Industries are considered to be the primary source of the environmental degradation and increasing pollution. As the governments and the societies awaken to the urgency of this problem the industries are being increasingly pressurised to become more environmentally conscious. The focus of the manufacturers has now shifted towards the use of more cleaner and greener technology and production of green products.
ISO 14000 is a series of standards developed by the ISO (International Organization for Standardization) which lays down a proper framework for the environmental management by the industries. The ISO 14001 standard is the standard within the ISO 14000 series that specifies the requirements of an environmental management system (EMS).The environment is now considered as an asset which needs to be protected and valued. As a result the corporations now have started to improve their ability to better manage their environmental performance. Therefore, the companies today are not only expected to provide better quality goods at reduced costs but also to become more environmentally conscious.
This paper aims to analyse whether the adoption of green technology (ISO14000) leads to an improvement in the productivity (TFP) of the firms which are operating in the manufacturing sector. In this study we have used the Levihnson Petrin method to measure the firms productivity (TFP) using a panel of one year 2009-2010 and 2010-2011. Further we do a cross sectional analysis of year 2011 using econometric techniques to test the impact of the adoption of an EMS on the productivity of the manufacturing firms. We found a positive and significant relationship between the adoption of ISO 14000 by a firm and its productivity.
Keywords: EMS, polluting firms, TFP
