The influence of government support over environmental protection investment on SMEs: R&D collaboration and financial aspects

Abstract

This paper aims to improve knowledge about the main factors influencing firm environmental commitment, by examining empirically the relationship between public support for R&D for small and medium enterprises (SMEs) and their investment in environmental protection. The empirical analysis was developed using a sample of 1594 Spanish firms, and a binary logistic regression to evaluate the existence of dependency relationships between the analyzed variables. The results show that those companies receiving direct funding from local public entities and those collaborating with research centers and universities, invest more in environmental actions to protect the natural ecosystem. The paper contributes to the academic literature by analyzing the main factors that influence the SMEs environmental commitment. Moreover, showing practitioners and policy makers the effectiveness of different types of financial support depending on the origin of the funds and the form of action taken; showing managers the advantages of collaborating with public administrations, as well as with other research organizations, to obtain better ECSR results.