Eco-Innovation in the Chemical Manufacturing Firms: Insights for Policy Response
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Abstract
Designing effective policies to promote a firm’s eco-innovation activities require policy makers to have significant knowledge on current industrial practices and activities. This paper investigates the state of eco-innovation activities, namely process, product and organisational eco-innovation in the chemical industry and further unveils common characteristics of firms that eco-innovate. Data was collected from interviews and surveys of 97 chemical firms. The results suggest that a large percentage of firms are involved in process technology and organisational eco-innovation and most of the innovation are adoptions rather than creations. Likewise, a higher percentage of foreign firms are eco-innovative. Export destination seems to play no role in improving the likelihood of firms to eco-innovate. The evidence suggests that local environmental policies are instrumental in encouraging eco-innovation. Policy implications are further discussed.
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