Identification of the Factors That Affect the Environmental Administrative Burden for Businesses

Abstract

Environmental regulations bring social benefits and contribute to lessening environmental damage. At the same time, due to the rapidly changing and complex environmental legislation, businesses incur costs, including administrative burdens. The article presents quantitative evidence on the factors that affect the compliance costs of environmental regulations. For this purpose, we used a binary model of logistic regression with the following predictors: enterprise characteristics, the relevance of environmental regulations for business operations, and the impact of environmental stimulus measures on compliance costs. The results of the study suggest that medium-sized enterprises are less likely to experience the environmental administrative burden than small enterprises. However, no difference has been found between large and small enterprises. Further, we show that environmental consents are an important determinant of the environmental administrative burden and that financial environmental measures can have a positive impact thereon.

Burdens Are Everybody’s Business: Examining the Intersection of Administrative Burdens, Motivation, and Entrepreneurial Culture

“…Not all burdens placed on businesses originate from bad intentions or have negative outcomes. Burdens are often levied in order to curtail corporate abuse or busines/private activities that fetter the public good (Kotnik et al, 2020). In the context of business, burdens are therefore often intentionally levied by governments for the purposes of engineering democratic outcomes.…”

“…Compliance costs for example are understood as unproductive compliance requirements that deviate business resources away from actual activities that improve business outcomes (Crain & Crain, 2020). Administrative burdens in the business context are those costs that businesses would not have to bear if they were not legally obligated to do so (Kotnik et al, 2020). Some of these burdens include the costs that are related to recordkeeping, information gathering, and the capital a business may expend to ensure that it stays compliant with government regulations (Bradford, 2004).…”

“…Johnson & Kroll, 2020), the burdens faced by organizations and businesses has been understudied. Burdens are sometimes levied with noble intentions and with an interest to produce democratic outcomes (Hodgson, 2009; Kitching et al, 2015; Kotnik et al, 2020). For example, the government can place more burdens on businesses to prevent/reduce corporate abuse or tax evasion, or even fraudulent abuse of public programs (Moynihan et al, 2015).…”

A Literature Review of the Factors Affecting the Compliance Costs of Environmental Regulation and Companies’ Productivity

“…Still, to make a systematic effort to reduce the administrative burdens you need to know are the factors that influence their relative size for the companies. Thus far, literature has addressed the issue by focusing on one particular or a smaller set of factors (Eichfelder and Schorn, 2012;Fauziati and Kassim, 2018;Kotnik et al, 2020;Schoonjans et al, 2011;Slabe-Erker and Klun, 2012) while by our knowledge no holistic methodology has been developed in administrative, public or economic policy or other related fields that could fully encompass the issues outlined above. Therefore, the aim of this article is to address the gap and demonstrate the need for a comprehensive analysis concerning the factors of compliance costs.…”

“…In the second phase, conducting a review in order to find relevant compliance (administrative) costs factors, we used the Scopus database, in which we applied various search query including titles, abstract and keywords "compliance cost", "administrative cost", "compliance burden", "administrative burden", and "factor" limited to subject area "social sciences", "business, management and accounting", "economics, econometrics and finance". This literature review yields limited results, since only a limited number of studies focused specifically on measuring impact significance of potential factors of companies' compliance costs (Eichfelder and Schorn, 2012;Fauziati and Kassim, 2018;Klun and Blazic, 2005;Kotnik et al, 2020;Schoonjans et al, 2011;Tran-Nam et al, 2000). To broaden that list of potential factors, we expanded our literature review to other related fields as well.…”