Compliance with Environmental Regulations: Insights from Small and Medium Scale Enterprises in the Food and Beverage Sector in Southwestern Nigeria.

In view of the proliferation of SMEs, their compliance with extant environmental regulations is important in reducing the environmental impact of their production activities. Literature on the level and frequency of compliance with regulations to inform enforcement policy is however scarce. In addition, information on the impact of size on compliance within the SME business category is insufficient. This study filled these gaps by the examination of level, frequency and impact of size on compliance among 256 SMEs in the food and beverage sector in Southwestern Nigeria. The study employed a structured questionnaire survey distributed to the managers of the SMEs across three states. The results showed that some SMEs were not in compliance with extant regulations. About 15% of the SMEs were not in compliance with solid waste management regulations, while 15.3% have no air pollution measures. In addition, 15.8% of the firms did not treat waste water discharge from production processes. The study also indicated that 24% of SMEs failed to conduct Environmental Impact Assessments (EIAs), Results also showed (on a 5-point Likert frequency scale from never to always) that respondents sometimes; were in compliance with continuous monitoring and reporting of environmental performance (3.39), adhered to sustainable supply chain practices (3.38) and were in compliance with stakeholder involvement in the firm’s environmental initiatives (3.38). In addition, the small-sized firms were more compliant than medium-sized businesses in having a waste management plan, integrating sustainability into business operations, preparing periodic environmental audits and assessments, and responsiveness to community complaints on wastes. The study recommended more regular and stringent enforcement policy mechanisms to curb the hazardous activities of SMEs.