Government incentives and how they encourage manufacturing facilities to adopt environmental management systems: a look at the efficiency of policy tools

Traditional methods of environmental regulation and enforcement have been questioned over the last decade. Due to the number of environmental regulations, and subsequent cost of enforcement, governments have begun to incentivize the adoption of environmental management systems (EMSs). These management systems encourage companies to better manage their environmental performance voluntarily. It is the purpose of this study to list the types of government incentives that have been used and categorize them into three groups based off of their characteristics. Ten incentive types were identified and put into three categories; (a) reducing the barriers to EMS adoption; (b) enhancing benefits derived from EMS adoption, and (c) rewarding EMS implementers with reduced enforcement. The research shows that each category of incentives encourages different manufacturing facilities to adopt EMSs. Using data from previously conducted case studies and surveys to determine what type of manufacturing facilities are affected, this study finds that government incentives have been shown to have a measurable impact on the decision makers of manufacturing facilities to adopt an EMS. The study concludes that a combination of traditional environmental regulation used with targeted incentives provide the most efficient use of resources by governments.