Assessment of cleaner production in agro processing industries: a data envelopment analysis approach

Cleaner production (CP) initiatives have proved to be effective in conservation of resources leading to benefits for the industry, environment and society. Internationally, cleaner production programs are disseminated by the initiatives taken by United Nations Environment Programme (UNEP), United Nations Industrial Development Organization (UNIDO) and Organization for Economic Cooperation and Development (OECD) in both developed and developing countries. Despite all these efforts the strategy has not been recognized much and implemented in industries including Micro Small and Medium Enterprises (MSMEs). Specifically, MSMEs face considerable difficulty in implementing CP initiatives due to lack of proper evaluation of CP success. To implement the CP initiative in an organisation, it requires wide spread dissemination of benefits of CP and a baseline for the CP. This requires acquiring knowledge about the prevailing practices of industries and benchmarking them against the best performer in the sector. An attempt has been made in the current paper to bring out the gaps in CP practices among cashew processing MSMEs. Constant return to scale Data Envelopment Analysis (DEA) is adopted with input and output orientations so as to elicit how much inputs are to be decreased or outputs to be increased to make the inefficient units perform on par with efficient units. DEA considers all factors that affect the unit’s performance by converting multiple inputs and outputs into a single measure of productive efficiency that allows comparing peers to identify the opportunities for further improvement. The results revealed that more than 30% of the enterprises have potential to improve their performance by 10 to 12% to match with the efficient counterparts.