Green Supply Chain Management: Practices and Drivers in the Ethiopian Leather and Leather Product Industry

Abstract

Green supply chain management practices (GSCMPs) and their driving factors have been extensively studied globally, yet specific industry contexts remain underexplored. This study provides a pioneering assessment of GSCMPs within the Ethiopian leather and leather products industry. The primary objective is to evaluate the implementation level of strategic and operational GSCMPs and to identify the driving factors influencing their adoption, categorized broadly into institutional pressures (coercive, normative, and mimetic) and internal factors. Additionally, the role of firm-specific characteristics in adopting green practices is investigated. Data were collected from 118 firms between January and June of 2023 using a survey questionnaire adapted from existing literature. A descriptive analysis and partial least square-structural equation modeling were used to explore the current state of GSCMPs and to test the proposed hypotheses. Multi-group analysis was also carried out to examine the impact of the firm-specific characteristics. The results showed that although the industry’s GSCMPs are still in their infancy, tanneries, mature aged firms, large and medium-sized enterprises, and exporting firms have relatively better green practices. Besides, all institutional pressures had a significant positive effect on the GSCMPs in terms of driving factors, but internal factors did not. This suggests a possible lack of internal commitment to environmental sustainability within firms. Significant differences in the factors driving green practices are noted, particularly among exporters, footwear manufacturers, and mid-aged firms. The findings highlight the need to comprehend and address these institutional pressures to enhance environmental management practices in industries like the Ethiopian leather sector. As a result, this study will have implications for both policymakers and practitioners for making an informed decision, as the country’s vision of achieving middle income by 2025 through a green economy and sustainable development is not supported by the current level of the GSCMPs.