This study analysed 33 separate studies published between 1994 and 1999. The selected reports investigated the adoption of formal environmental management systems (EMSs) in small and medium-sized enterprises (SMEs) and SMEs' attitudes towards environmental performance. Twenty-two of the studies provided practical experience of SMEs' adoption of formal EMSs (BS 7750, ISO 14001 and EMAS). The majority (30%) of the studies were academic or research projects.

The major findings of the analysis are as follows:

• Internal barriers to EMS adoption are more important than external ones.

Internal Barriers to EMS Adoption

• The lack of human resources rather than financial ones is the major internal barrier to EMS implementation and becomes increasingly important as the size of the company decreases.
  
  
• EMS implementation is an interrupted and interruptible process in SMEs.
  
  
• Practical problems with EMS implementation exist and include how to determine environmental aspects and assign significance and how to achieve internal auditor independence in small and micro firms.
  
  
• SMEs are largely ill-informed about EMSs, how they work and what benefits can be gained from their implementation.

External Barriers to EMS Adoption

• SMEs face inconsistencies in and barriers from the certification and verification systems and complain bitterly about the high costs associated with being certified to ISO 14001 and registered to EMAS.
  
  
• Many SMEs experience insufficient drivers for EMSs adoption and are uncertain about the market benefits of such systems.
  
  
• SMEs need support and guidance to implement EMSs but experience difficulties gaining consistent quality information and experienced consultants of good quality. The lack of sector specific guidance and material tailored to different sizes of firms is an added problem.

Internal Barriers to SMEs Considering Environmental Issues

• Positive personal attitudes towards the environment are not translated into actions in SMEs.
  
  
• The view held by many in SMEs is that their firms have low environmental impact or face no environmental issues.
  
  
• SMEs are sceptical about the benefits, cost savings and customer rewards associated with positive environmental action, and there is a belief that benefits accrue slowly but costs quickly in EMS implementation.
  
  
• The environment is not a core business issue in the majority of SMEs and intransigent company culture and the lack of allocation of resources conspire to keep the status of environmental issues low on the business agenda.

External Barriers to SMEs Considering Environmental Issues

• Customer indifference to SMEs environmental performance, in particular the performance of micro firms, is a key reason why these enterprises consider environmental issues unimportant to business.

Benefits from Adopting an EMS

• SMEs found real and valuable benefits from implementing formal EMSs.
  
  
• Numerous organisational improvements and efficiencies are achieved in SMEs adopting EMSs and these are not solely related to the EMSs, i.e., spin-off management benefits arise.
  
  
• The range of financial savings and payback periods for investments generated in SMEs adopting EMSs are as diverse as the sector itself.
  
  
• Communication channels, skills, knowledge and attitude are all improved in SMEs adopting EMSs.
  
  
• Key benefits are the attraction of new business and customers and the satisfaction of customer requirements.
  
  
• SMEs found positive outcomes in terms of improved environmental performance, assured legal compliance and energy and material efficiencies.
  
  
• SMEs found image was enhanced and dialogue and relationships with stakeholders improved.

Disbenefits from Adopting an EMS

• SMEs found that more resources than expected, in terms of costs, time and/or skills were required for EMS implementation.
  
  
• SMEs are aggrieved by the cost and quality of consultants advising them. Some firms have been misadvised and developed bureaucratic and ineffective systems.
  
  
• Identification of non-compliance was viewed as a double-edged sword, being a benefit if the company could readily rectify the cause of the non-compliance and a disbenefit if action could not be taken because of lack of resources or unwillingness to allocate them.
  
  
• SMEs have dissatisfaction with the fact that benefits had not materialised as expected.

Stakeholders as Drivers

• Customers are the key driver for the adoption of EMSs and have influence far beyond any of the other stakeholders cited in the analysed studies.
  
  
• Legislation and the regulators are more important drivers for general environmental improvements in SMEs than customers.

This study estimated from September 1999 figures the number and percentage of SMEs with sites registered to EMAS in the UK as 17 SMEs (24%) and in the EU as 541 SMEs (18%). It also estimated the number and percentage of SMEs certified to ISO 14001 by UKAS accredited certification bodies to be between 254 and 568 SMEs (25% to 56%).

The SME sector is not a homogenous sector. It is diverse and heterogeneous. Studies which seek to investigate the sector and draw conclusions about it, are, to some extent, comparing not just apples and pears but the whole fruit bowl. This study's conclusions have this limitation. It is recommended that future research consider parts of the sector either as sub-groups by size, i.e. micro, small and medium, or by industrial sector.

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Ruth Hillary is a leading researcher and consultant in the field of environmental management and business. Her PhD is The Eco-management and Audit Scheme: Analysis of the Regulation, Implementation and Support, Imperial College. She is an expert member of the British Standard Institution's ES/1/-/1 SME Panel on Environmental Management Systems.

She has written and edited five books including Small and Medium-sized Enterprises and the Environment (Greenleaf Publishing, 1999)

Dr. Hillary established, in 1992, the Network for Environmental Management and Auditing (NEMA) as a forum to facilitate the exchange of ideas and practical experience in these fields between industry, policy makers and researchers.

Contact

Dr. Ruth Hillary
Network for Environmental Management and Auditing
174 Trellick Tower, Golborne Road
London W10 5UU
United Kingdom

Tel/Fax: +44 (0)181 968 6950
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E-mail: rhillary@nema.demon.co.uk