Description
CHAPTER ONE
1.1 Introduction
According to Coddington, (2013) green procurement is the purchasing of products or services which have a lower impact on the environment over their whole life cycle than the standard equivalent. It involves the integration of environmental issues into purchasing decisions based on price, performance, and quantity. Increasing costs of waste management worker safety and public health concerns, and the emergency of acute a chronic environmental problems both locally and globally are just a few of the issues spurring on local communities to improve the environmental characteristics of their operations (Maignom, Hillebrand & McAlistor, 2012) in the private sector, a large literature has explored engagement with sustainability in supply chain management and has highlighted benefits in the form of risk reduction and performance enhancement (Zhu, Sarkis & Geng, 2009). Sustainability in supply chain management requires a company or organization to carry out on assessment of the environmental consequences of a product at all the various stages of its Lifecycle. This means considering the costs of securing raw materials, and manufacturing, transporting, storing, handling, using and disposing of the product.
Green procurement is rooted in the principle of pollution prevention, which strives to eliminate or to reduce risks to human health and the environment (Bolton, 2010). It means evaluating purchases based on a variety of criteria, ranging from the necessity of the purchase in the first place to the options available for its eventual disposal. Many private firms in Nigeria are working to improve the environmental performance of their operations and products and green procurement has been a logical extension of this work. Similar to public buyers, private sector organizations have in the lost two decade adopted green procurement practices for specific products (recycled-content office paper, renewable energy, points, cleaners, etc.), with few others have developed green procurement policies that cover a wider range of products, services and environmental issues. As the business benefits of these efforts better known, green procurement is containing to grow in the private sector.
From manufacturing and process oriented firms green procurement practices look at the materials substance and chemicals in the products and services they provide (Theyel, 2012). Subsequently, this approach looks beyond the company?s gates to include the materials substances and chemicals its supplier use. The ongoing efforts to reduce costs, most companies in Nigeria use life cycle assessment and material tracking tools to identify materials, substances and chemicals in their products that pose significant environmental, health and safety risks and re-design their products to reduce or eliminate such materials. There are several regulatory frameworks aimed at greening the Nigeria economy, however the principal legislation concerned with environmental Standards and Regulations Enforcement Agency (NESREA) ACT 2007 and the Environmental impact Assessment (EIA) ACT 1992.
The NESREA Act replaced the Federal Environmental Protection Agency Act 2004. It establish the national environmental standards are regulations enforcement agency and charges the agency with responsibility, for the protection and development and sustainable of Nigeria?s natural resources in general and environmental technology including coordination, and Liaison with relevant stakeholders within and outside Nigeria on matter of enforcement of environmental.
As already mentioned, the second relevant legislation in the EIA Act passed in 1992 to promote proactive environmental management in Nigeria. The art makes EIA mandatory for development projects likely to have adverse impact on the environment prior to implementation.
While these environmental regulations focus on environmental protection and pollution control, the application of Green procurement offers another way for demonstrating Nigeria?s commitment to environmental sustainability (Temidayo, Adekunle and Ama, 2013).
Daft, Walker and Brammer, (2009), stated that currently, there is political consensus that sustainable development is both wanted and necessary. On the other hand, it has proven difficult to reach an agreement as to which effects are going to lead this green development not least in a globalized world where both goods and pollution are increasingly crossing borders. One of the instruments often debated in green public procurement opposes of green procurement are typically worried about possible additional costs that the public will have to bear and at the same time, they doubt that the state via subsidy policies and the like is able to pick the winner. The publication of Brundtland commission report ?Our Common future? on sustainable development (WECD, 1987) brought forward issues that promote public policies that encourages development and diffusion of environmentally sound goods and services have provided impetus and the much need inspiration towards policy formulation and adoption (Thomas & Jackson, 2007).
According to Thai (2006) green purchasing is the adding of environmental aspect to price and performance criteria when making purchasing decision as opposed to the fixation with price as the only criteria. Leading international agencies that have included environmental issues in their procurement guides include the International Bank for Reconstruction and Development (IBRD), Africa Development Bank (AfDB) and United Nation (UN). Specific countries that have mainstreamed environmental agenda in their procurement policies include the United State of America (Swanson et al 2005), South Africa (Bolton, 2006, 2008) and Asia (Ho, Diekinson & Chan 2010). In Europe, the directives (2004/17/EC and 2004/18/EC) have specific guidelines that require member countries to implement, thereby bringing about rapid environment diffusion and visibility.
Locally green procurement has been a logical extension of this work (Brammer & Walker, 2011), Yet Nigeria as one of the development countries has been slow in taking up structured and policy driven approach to enhancing adoption of green procurement, the benefits occurring notwithstanding (Bolton, 2006, 2008). The public procurement and disposal Act, 2007 and subsequent regulations 2005, which are the cure points of reference on public procurement in Nigeria, were reviewed.
1.2 STATEMENT OF THE PROBLEM
Developed countries have initiated the use of green procurement as a tool to protect the environment, resources and the wellbeing of the earthly residents, developing countries can adopt green culture in other to minimize rapid deterioration of the environment. According to Maron, (2013) environmental issues have become a subject of critical concern for business in recent years worldwide. Environmental obligations have grown substantially as society become more conscious of its environment and legislation relative to the environment in increasing in number that requires companies to be environmentally responsible. In height of increasing cost of waste management, environmental degradation, public health concerns, climate change, resource depletion, and persistent global poverty, the supply management profession increasingly being called upon to contribute to broader organizational goals of sustainable development through the inclusion of social and environmental criteria within procurement processes (Srivastava, 2013). According to Faith ? Ell, Bal Fors & Folkson, (2010) environmental substantiality is still among the issues included in the eight International Development goals (Millennium Development Goals) that were established following the millennium summit of the United Nations in Millennium Declaration.
Despite the important role green procurement plays in ensuring environment performance and public health and safety, most of the studies on subject had been conducted in develop countries, yet not much research had been conducted in Nigeria leading to insufficient empirical literature on green procurement (Stephen & Helen, 2011) it was against this background this background that this inquiry to analyze the factors that affect green procurement implementation in the manufacturing sector in Nigeria. This research study provided valuabole unique contribution s to greemn procurenment literature. Career procurement research within manufacturing sector is particularly important considering recent studies indicate a rise in costs of waste management, worker safety and public health concern both locally and globally, implying that it is an area that still needs addressing (Jayaraman et al., 2013). Hence, the study instigated that gap in research by analyzing the factors that affect green procurement implementation in the manufacturing sector in Nigeria.
1.3 GENERAL OBJECTIVE
To analyze the factors that affect green procurement implementation the manufacturing industry in Nigeria.
SPECIFIC OBJECTIVE
i. To determine how firm resources capacity affect implementation of green procurement in manufacturing industry in Nigeria.
ii. To explore the effect of costs of green procurement on implementation of green procurement in manufacturing industry in Nigeria.
1.4 RESEARCH QUESTION
i. In what ways does cost of green procurement affect implementation of green procurement in manufacturing industry in Nigeria.
ii. Does green procurement implementation in a manufacturing industry in Nigeria affect Nigeria Distilleries Limited?
iii. Does firm resources capacity affect implementation of green procurement in Nigeria Distilleries Limited?
RESEARCH HYPOTHESIS
It is in consideration of the problems stated and above and the objective of the studied environment that the researcher pronounced the following hypotheses.
i. Ho1: the cost of green procurement implementation have no significant effect in the organization
ii. Ho2: There are no significant relationships between financial resources on implementation of green procurement NDL.
1.6 SIGNIFICANCE OF THE STUDY
This study is significant especially to the factors that affect the implementation of green procurement in the manufacturing industry. The basic of the study was to ascertain whether green procurement implementation in a manufacturing industry. The study was significant in that it cab guide one on how to carry out a research in the future as scholars may revisit related topics in order to carry out further studies. The study has intended to coordinate to the growing body of literature on green procurement implementation in Nigeria.
This project would open awareness for tremendous reduction of the cost of research work (through centralization of research program and motivate young researchers of our time to face the challenges of this millennium
1.7 SCOPE OF THE STUDY
This study is intended to focus on the factors that affect green procurement implementation in the manufacturing industry with particular reference to Nigeria Dissilience Limited Sango Ota, Ogun state. Where the goal is not only to enhance the firm resources capacituy but also to manage the cost effectively. With a view to finding out the level of success recorded in their organization as a result of green procurement implementation.
1.8 LIMITATION OF THE STUDY
Though a wide observation of the study will be made, however, because of time and space including resources involved some of the respondents here unwillingly to corporate with the researcher since they derived no financial benefit from the study. Others were apprehensive of the researcher?s intention, suspect ions, that the researcher may disclose their personal information.
Financial problem is also another constraint in producing this project as a student financial capacity is limited; scarcity of materials is also one.
1.9 DEFINITION OF TERMS
Supply Chain Management (SCM)
The management of the flow of goods and services, involve the movement and storage of raw materials, of work ? in ? process inventory, and finished goods from point of origin to point of consumption.
Environmental Sustainability
Is defined as responsible interaction with the environment to avoid depletions degradation of natural resources and allow for long term environmental quality.
Sustainability
Is defined as sustainable development that meet the needs of the present without compromising the ability of future generations to meet their own needs.
Procurement
Procurement is the process of finding, asreeingterius and acquiring goods, services or works from an external source, often via a tendering or competitive bidding process.
Industry
The manufacturing or technically productive enterprises in a particular field, country, region or economy viewed collectively, or one of the individually. A single industry, is often named after its principal product, for example, the auto industry.
Manufacturing Industry
Abraneh of manufacture and trade based on the fabrication, processing, or preparation of products from raw materials to finished commodities. This includes all foods chemicals, textiles, machines, and equipment.
1.10 HISTORICAL BACKGROUND
Nigeria Distilleries, Limited (NDL) incorporated on the 6th of March 1961with 100% Nigerian ownership, is the largest nine and spirits producing company in Nigeria, solely devoted to the manufacturing and marketing of fourteen brands of alcoholic and non alcoholic beverages in 35 different pack Sizes. Nigeria Distilleries Limited (NDL) began production in 1979 with raw materials imported for the blending and bottling of international brands; Dubonnet, Ambassador, suze, Compari, Coitread, Dorville Brandy, Pimms and Mortini.
Over the years, with experience and intensive research, ?NDL? have grown adding to their range of hioce brands which include Seamonis Aromatic Schnapps Regal Dry Cuin, Lords Dry Cuin, Bacchus tonic wine, Baecchus Lite, Calypso coconut Liqueur, Apperito, and dark sailor Blended Dark Ruin.
The company has more than one thousand employees and has s philosophy of manufacturing Local personnel through training and exposure to modern equipment NDL has achieved phenomenal growth form inception through training and exposure to modern equipment NDL has achieved phenomenal growth form inception through the quality of its workforce. The current beverage capacity of the company is ten million liters per year with distribution outlets spread across the country.
The demand for both alcoholic and non ? alcoholic beverages in Nigeria increases daily over the years, with experience and intensive research NDL has expanded and improved its product range and quality level to satisfy its customers and meet the high demand for their products. Currently, NDL is regarded as the company with the best brand of beverages and a foremost leader in the best brand of beverages and a foremost leader in the alcoholic and non ? alcoholic beverage segment of the food and Beverage industry in Nigeria. NDL has a promises outlook derived from its business strategies and focus.