The Drivers of Firms' Compliance to Environmental Regulations : The Case of India

Regulatory compliance is key in the fight against climate change and other environmental challenges. But regulatory agencies, especially in developing countries, are often hampered by their capacity to monitor and enforce standards and regulations...

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Main Authors:	Franco-Bedoya, Sebastian, Mani, Muthukumara
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2020
Subjects:	ENVIRONMENTAL PROTECTION ENVIRONMENTAL REGULATION REGULATORY COMPLIANCE INSPECTION SELF-REPORTING POLLUTION CONTROL DEVELOPMENT CLIMATE CHANGE MITIGATION
Online Access:	http://documents.worldbank.org/curated/en/190781604501986407/The-Drivers-of-Firms-Compliance-to-Environmental-Regulations-The-Case-of-India http://hdl.handle.net/10986/34735

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recordtype	oai_dc
spelling	okr-10986-347352022-09-20T00:10:36Z The Drivers of Firms' Compliance to Environmental Regulations : The Case of India Franco-Bedoya, Sebastian Mani, Muthukumara ENVIRONMENTAL PROTECTION ENVIRONMENTAL REGULATION REGULATORY COMPLIANCE INSPECTION SELF-REPORTING POLLUTION CONTROL DEVELOPMENT CLIMATE CHANGE MITIGATION Regulatory compliance is key in the fight against climate change and other environmental challenges. But regulatory agencies, especially in developing countries, are often hampered by their capacity to monitor and enforce standards and regulations against recalcitrant firms. There is now a big push toward self-reporting whereby the firms monitor and report on their compliance levels vis-a-vis the standards. This is seen as a way around the costs that agencies must incur if they were to scale up their inspections. In this paper, extensive firm-level data from India are used to compare the compliance level of firms when they are inspected by agencies versus the times when they self-report. Other factors that may determine regulatory compliance, such as age, size, sector, location, and so forth, are also examined. The results indicate that compliance rates are higher in the case of self-reporting than in the case of inspection, suggesting that there is a need to reform the self-report mechanism. Newer and privately owned firms are more compliant. There are also differences between complying with air and water pollution. Finally, the paper examines whether environmental monitoring through inspections leads to improvement in compliance levels, to assess the effectiveness of the regulations and inspections. The findings suggest that the increase in compliance is limited to a few industries. 2020-11-05T16:14:45Z 2020-11-05T16:14:45Z 2020-11 Working Paper http://documents.worldbank.org/curated/en/190781604501986407/The-Drivers-of-Firms-Compliance-to-Environmental-Regulations-The-Case-of-India http://hdl.handle.net/10986/34735 English Policy Research Working Paper;No. 9468 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper South Asia India
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ENVIRONMENTAL PROTECTION ENVIRONMENTAL REGULATION REGULATORY COMPLIANCE INSPECTION SELF-REPORTING POLLUTION CONTROL DEVELOPMENT CLIMATE CHANGE MITIGATION
spellingShingle	ENVIRONMENTAL PROTECTION ENVIRONMENTAL REGULATION REGULATORY COMPLIANCE INSPECTION SELF-REPORTING POLLUTION CONTROL DEVELOPMENT CLIMATE CHANGE MITIGATION Franco-Bedoya, Sebastian Mani, Muthukumara The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
geographic_facet	South Asia India
relation	Policy Research Working Paper;No. 9468
description	Regulatory compliance is key in the fight against climate change and other environmental challenges. But regulatory agencies, especially in developing countries, are often hampered by their capacity to monitor and enforce standards and regulations against recalcitrant firms. There is now a big push toward self-reporting whereby the firms monitor and report on their compliance levels vis-a-vis the standards. This is seen as a way around the costs that agencies must incur if they were to scale up their inspections. In this paper, extensive firm-level data from India are used to compare the compliance level of firms when they are inspected by agencies versus the times when they self-report. Other factors that may determine regulatory compliance, such as age, size, sector, location, and so forth, are also examined. The results indicate that compliance rates are higher in the case of self-reporting than in the case of inspection, suggesting that there is a need to reform the self-report mechanism. Newer and privately owned firms are more compliant. There are also differences between complying with air and water pollution. Finally, the paper examines whether environmental monitoring through inspections leads to improvement in compliance levels, to assess the effectiveness of the regulations and inspections. The findings suggest that the increase in compliance is limited to a few industries.
format	Working Paper
author	Franco-Bedoya, Sebastian Mani, Muthukumara
author_facet	Franco-Bedoya, Sebastian Mani, Muthukumara
author_sort	Franco-Bedoya, Sebastian
title	The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
title_short	The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
title_full	The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
title_fullStr	The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
title_full_unstemmed	The Drivers of Firms' Compliance to Environmental Regulations : The Case of India
title_sort	drivers of firms' compliance to environmental regulations : the case of india
publisher	World Bank, Washington, DC
publishDate	2020
url	http://documents.worldbank.org/curated/en/190781604501986407/The-Drivers-of-Firms-Compliance-to-Environmental-Regulations-The-Case-of-India http://hdl.handle.net/10986/34735
_version_	1764481544278245376

The Drivers of Firms' Compliance to Environmental Regulations : The Case of India

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