Challenges and strategies for enhancing environmental performance in Indonesia’s batik industry

Challenges and strategies for enhancing environmental performance in Indonesia’s batik industry

Authors

  • Wenti Ayu Sunarjo Universitas Pekalongan
  • Siti Nurhayati Universitas Pekalongan

Keywords:

Environmental performance, Eco-efficiency, Non-product output, Waste reduction, Batik industry

Abstract

Sustainability is now accepted by all stakeholders as a guiding principle for public policy making and corporate strategy. However, the biggest challenge still lies in the implementation of achieving environmental performance in an industry. The current concept of environmental waste focuses on the total waste production from the remaining production results. Therefore, there is an emphasis on limiting waste within the boundaries of the industry and implementing post-production processes to clean it up. The batik industry as a livelihood for some Indonesian people still produces waste from production (solid and liquid waste) which disrupts environmental sustainability. This study aims to determine the effect of eco-efficiency, non-product output, and waste reduction on environmental performance. The associative method was used in this study. The types of data used are primary and secondary data, with data collection methods through questionnaires. Quantitative methods with Smart PLS analysis tools were used in collecting research data and analyzing the answers collected to questions from available respondents. The results showed that the relationship between eco-efficiency and environmental performance had a significant effect, as well as the relationship between non-product output and environmental performance, the results were significant. However, the relationship between waste reduction and environmental performance was not significant. Efforts to achieve better environmental performance must be carried out by reducing sources such as low-waste technology and on-site management performance. Meanwhile, encouraging sorting behavior such as increasing stakeholder awareness of waste, improving regulations, strengthening government supervision and controlling illegal dumping should be emphasized.

References

[1] Derks, M., & Romijn, H. (2019). “Sustainable performance challenges of rural microgrids: Analysis of incentives and policy framework in Indonesia”. Energy for Sustainable Development, 53, 57-70.

[2] Ramadhan, M. L., Nugraha, F., Prastowo, D. A., Kusumawardhani, A., & Raharjo, S. T. (2024). “Development of Environmentally Friendly Technology for Key Industries in Achieving Golden Indonesia”. Research Horizon, 4(4), 205-220.

[3] Schroeder, P., Anggraeni, K., & Weber, U. (2019). “The relevance of circular economy practices to the sustainable development goals”. Journal of Industrial Ecology, 23(1), 77-95.

[4] Aminullah, E., Fizzanty, T., Nawawi, N., Suryanto, J., Pranata, N., Maulana, I., ... & Budiatri, A. P. (2024). “Interactive components of digital MSMEs ecosystem for inclusive digital economy in Indonesia”. Journal of the Knowledge Economy, 15(1), 487-517.

[5] Mayanj, S. N. (2023). “SDGs, the Green Economy and Finance, and the Role of MSMEs”. International Journal of Small and Medium Enterprises and Business Sustainability, 8(1), 70-100.

[6] Alfarizi, M., Widiastuti, T., & Ngatindriatun. (2024). “Exploration of technological challenges and public economic trends phenomenon in the sustainable performance of Indonesian digital MSMEs on industrial era 4.0”. Journal of Industrial Integration and Management, 9(01), 65-96.

[7] Martuti, N. K. T., Hidayah, I., Margunani, M., & Alafima, R. B. (2020). “Organic material for clean production in the batik industry: A case study of natural batik Semarang, Indonesia”. Recycling, 5(4), 28.

[8] Soesanti, I., & Syahputra, R. (2016). “Batik production process optimization using particle swarm optimization method.” Journal of Theoretical and Applied Information Technology, 86(2), 272.

[9] Ewuzie, U., Saliu, O. D., Dulta, K., Ogunniyi, S., Bajeh, A. O., Iwuozor, K. O., & Ighalo, J. O. (2022). “A review on treatment technologies for printing and dyeing wastewater (PDW)”. Journal of Water Process Engineering, 50, 103273.

[10] Tariq, A., & Mushtaq, A. (2023). “Untreated wastewater reasons and causes: a review of most affected areas and cities”. Int. J. Chem. Biochem. Sci, 23(1), 121-143.

[11] Singh, N., Poonia, T., Siwal, S. S., Srivastav, A. L., Sharma, H. K., & Mittal, S. K. (2022). “Challenges of water contamination in urban areas”. In Current directions in water scarcity research (Vol. 6, pp. 173-202). Elsevier.

[12] Daud, N. M., Abdullah, S. R. S., Hasan, H. A., & Dhokhikah, Y. (2022). “Integrated physical-biological treatment system for batik industry wastewater: A review on process selection”. Science of The Total Environment, 819, 152931.

[13] Jaiswal, K. K., Chowdhury, C. R., Yadav, D., Verma, R., Dutta, S., Jaiswal, K. S., & Karuppasamy, K. S. K. (2022). “Renewable and sustainable clean energy development and impact on social, economic, and environmental health”. Energy Nexus, 7, 100118.

[14] Mohammad, R. E. A., Abdullahi, S. S. A., Muhammed, H. A., Musa, H., Habibu, S., Jagaba, A. H., & Birniwa, A. H. (2024). “Recent technical and non-technical biorefinery development barriers and potential solutions for a sustainable environment: A mini review”. Case Studies in Chemical and Environmental Engineering, 9, 100586.

[15] Kusumawardani, S. D. A., Kurnani, T. B. A., Astari, A. J., & Sunardi, S. (2024). “Readiness in implementing green industry standard for SMEs: Case of Indonesia's batik industry”. Heliyon, 10(16).

[16] Wielgórka, D. (2016). “Environmental management in the aspect of sustainable development in micro-, small-, and medium-sized enterprises”. Desalination and Water Treatment, 57(3), 982-992.

[17] Lorek, S., & Spangenberg, J. H. (2014). “Sustainable consumption within a sustainable economy–beyond green growth and green economies”. Journal of cleaner production, 63, 33-44.

[18] Nosakhare Peter, Osazuwa, and Ayoib Che-Ahmad , (2016),"The moderating effect of profitability and leverage on the relationship between eco-efficiency and firm value in publicly traded Malaysian firms ", Social Responsibility Journal, Vol. 12 Iss 2 pp. 295 – 306. http://dx.doi.org/10.1108/SRJ-03-2015-0034

[20] Ioannou, I., & Serafeim, G. (2012). “What drives corporate social performance? The role of nation-level institutions”. Journal of international business studies, 43, 834-864.

[21] Raharjo, K. (2019). “The role of green management in creating sustainability performance on the small and medium enterprises”. Management of Environmental Quality: An International Journal, 30(3), 557-577.

[22] Naidoo, M., & Gasparatos, A. (2018). “Corporate environmental sustainability in the retail sector: Drivers, strategies and performance measurement”. Journal of Cleaner Production, 203, 125-142.

[23] Schaltegger, S. and Sturm, A. (1990). “Ökölogische Rationalität. Ansatzpunkte zur Ausgestaltung von ökologieorientierten Managementinstrumenten”. Die Unternehmung, No. 4, pp.273–290.

[24] Figge, F., & Hahn, T. (2004). “Sustainable value added—measuring corporate contributions to sustainability beyond eco-efficiency”. Ecological economics, 48(2), 173-187.

[25] Oliveira, R., Camanho, A. S., & Zanella, A. (2017). “Expanded eco-efficiency assessment of large mining firms”. Journal of Cleaner Production, 142, 2364-2373.

[26] Schmidheiny, S. 1992. “Changing course: A global business perspective on development and the environment”. Cambridge, MA: MIT Press.

[27] O'Dochartaigh, A. (2014). “The possible role of business organisations in sustainable development: approaches, boundaries, future directions (Doctoral dissertation, University of St Andrews)”.

[28] Schmidheiny, S., & Stigson, B. (2000). “Eco-efficiency: Creating More Value With Less Impact”. In WBCSD: World Business Council for Sustainable Development.

[29] Simioni, F. J., & da Silva, F. A. (2021). “Eco-efficiency: Concept, Indicators, and Applications”. In Affordable and Clean Energy (pp. 293-303). Cham: Springer International Publishing.

[30] Chen, F., Ahmad, S., Arshad, S., Ali, S., Rizwan, M., Saleem, M. H., ... & Balsalobre-Lorente, D. (2022). “Towards achieving eco-efficiency in top 10 polluted countries: The role of green technology and natural resource rents”. Gondwana Research, 110, 114-127.

[31] Zhang, C., Chen, W. Q., & Ruth, M. (2018). “Measuring material efficiency: A review of the historical evolution of indicators, methodologies and findings”. Resources, Conservation and Recycling, 132, 79-92.

[32] Laso, J., García-Herrero, I., Margallo, M., Vázquez-Rowe, I., Fullana, P., Bala, A., ... & Aldaco, R. (2018). “Finding an economic and environmental balance in value chains based on circular economy thinking: An eco-efficiency methodology applied to the fish canning industry”. Resources, Conservation and Recycling, 133, 428-437.

[33] Arbelo, A., Pérez-Gómez, P., Rosa-González, F. M., & Ramos, L. (2014). “Eco-efficiency: Environmental performance vs economic performance”. Management Studies, 2(4), 239-253.

[34] Heras-Saizarbitoria, I., García, M., Boiral, O., & de Junguitu, A. D. (2020). “The use of eco-efficiency indicators by environmental frontrunner companies”. Ecological Indicators, 115, 106451.

[35] Zielińska-Chmielewska, A., Olszańska, A., Kaźmierczyk, J., & Andrianova, E. V. (2021). “Advantages and constraints of eco-efficiency measures: The case of the polish food industry”. Agronomy, 11(2), 299.

[36] Majid, S., Zhang, X., Khaskheli, M. B., Hong, F., King, P. J. H., & Shamsi, I. H. (2023). “Eco-efficiency, environmental and sustainable innovation in recycling energy and their effect on business performance: evidence from European SMEs”. Sustainability, 15(12), 9465.

[37] Putri, W. H., & Sari, N. Y. (2019, March). “Eco-efficiency and eco-innovation: strategy to improve sustainable environmental performance”. In IOP Conference Series: Earth and Environmental Science (Vol. 245, No. 1, p. 012049). IOP Publishing.

[38] Sudha, S. (2020). “Corporate environmental performance–financial performance relationship in India using eco-efficiency metrics”. Management of Environmental Quality: An International Journal, 31(6), 1497-1514.

[39] Fadjarenie, R. A., Rachmadani, C., & Tarmidi, D. (2024). “Cost Reduction Strategy In Manufacturing Industries Empirical Evidence From Indonesia”. Jurnal Akuntansi, 28(1), 61-79.

[40] Priambodo, B., & Hartono, D. M. (2018). “Determination of eco-efficiency level of solid waste management of polypropylene cloth on motorcycle tire industry in Cileungsi (West Java)”. In E3S Web of Conferences (Vol. 74, p. 06006). EDP Sciences.

[41] Doorasamy, M. (2015). “The effectiveness of Material Flow Cost Accounting (MFCA) in identifying non-product output costs and its impact on environmental performance in paper manufacturing companies: A case study in Kwa-Zulu Natal”. The Journal of Accounting and Management, 4(3).

[42] Esfahbodi, A., Zhang, Y., Liu, Y., & Geng, D. (2023). “The fallacy of profitable green supply chains: The role of green information systems (GIS) in attenuating the sustainability trade-offs”. International Journal of Production Economics, 255, 108703.

[43] Liu, Z. (2017). “Contributing to Intrinsic Sustainable Development: A Study of Environmental Management Accounting Implementation in Chinese Companies (Doctoral dissertation, University of Sheffield)”.

[44] AbouAssi, K., & Bies, A. (2018). “Relationships and resources: The isomorphism of nonprofit organizations’(NPO) self-regulation”. Public Management Review, 20(11), 1581-1601.

[45] Hansen, E. G., & Schaltegger, S. (2016). “The sustainability balanced scorecard: A systematic review of architectures”. Journal of Business Ethics, 133, 193-221.

[46] Effendi, B. (2021, April). “The Impact of Environmental Performance on Firm Value: Evidence from Indonesia”. In 7th Regional Accounting Conference (KRA 2020) (pp. 155-161). Atlantis Press.

[47] Sunarjo, W. A., Setyanto, R. P., & Suroso, A. (2022). “Motives And Green Innovation Performance in Indonesian Small and Medium Enterprises (Sme's) Batik-A Qualitative Case Study”. Calitatea, 23(186), 74-82.

[48] Milios, L. (2021). “Towards a circular economy taxation framework: Expectations and challenges of implementation”. Circular Economy and Sustainability, 1(2), 477-498.

[49] Choudhari, A. A. (2018). “Techniques to reduce the cost of raw material and to gain the profits”. International Research Journal of Engineering and Technology (IRJET), 5(8).

[50] Perdana, S., & Rahman, A. (2020, December). “Waste Analysis in the Painting Process of Doll Houses Using Value Stream Mapping (VSM)”. In 1st International Conference on Folklore, Language, Education and Exhibition (ICOFLEX 2019) (pp. 113-118). Atlantis Press.

[51] Chandrasekhar, S. S., Tsai Do, B. S., Schwartz, S. R., Bontempo, L. J., Faucett, E. A., Finestone, S. A., ... & Satterfield, L. (2019). “Clinical practice guideline: sudden hearing loss (update)”. Otolaryngology–Head and Neck Surgery, 161(1_suppl), S1-S45.

[52] Munoz Hurtado, S. (2023). “Evaluating innovations in municipal solid waste management: a case study of their feasibility and potential impact in Colombia (Doctoral dissertation, Technische Hochschule Ingolstadt)”.

[53] Gold, N. O., Taib, F. M., & Ma, Y. (2022). “Firm-level attributes, industry-specific factors, stakeholder pressure, and country-level attributes: global evidence of what inspires corporate sustainability practices and performance”. Sustainability, 14(20), 13222.

[54] Mancilla-Leytón, J. M., Fernández-Rodríguez, M. J., De la Lama-Calvente, D., & Borja, R. (2024). “Evaluation of batch mesophilic anaerobic digestion of waste Euro banknotes for methane Production: Preliminary studies and kinetic approach”. Waste Management, 173, 22-28.

[55] Acs, Z., Åstebro, T., Audretsch, D., & Robinson, D. T. (2016). Public policy to promote entrepreneurship: a call to arms. Small business economics, 47, 35-51.

[56] Sunarjo, W. A., Manalu, V. G., & Adawiyah, W. R. (2021). “Nurturing Consumers'green Purchase Intention On Natural Dyes Batik During Craft Shopping Tour In The Batik City Of Pekalongan Indonesia”. Geo Journal of Tourism and Geosites, 34(1), 186-192.

[57] Hyatt, D. G., & Berente, N. (2017). “Substantive or symbolic environmental strategies? Effects of external and internal normative stakeholder pressures”. Business Strategy and the Environment, 26(8), 1212-1234.

[58] Barclay, P. (2013). “Strategies for cooperation in biological markets, especially for humans”. Evolution and Human Behavior, 34(3), 164-175.

[59] Ghisellini, P., Cialani, C., & Ulgiati, S. (2016). “A review on circular economy: the expected transition to a balanced interplay of environmental and economic systems”. Journal of Cleaner production, 114, 11-32.

[60] Bhatia, M., Meenakshi, N., Kaur, P., & Dhir, A. (2024). “Digital technologies and carbon neutrality goals: An in-depth investigation of drivers, barriers, and risk mitigation strategies”. Journal of Cleaner Production, 451, 141946.

[61] Pu, G., Li, S., & Bai, J. (2023). “Effect of supply chain resilience on firm’s sustainable competitive advantage: a dynamic capability perspective”. Environmental Science and Pollution Research, 30(2), 4881-4898.

[62] Aragão, C. G., & Jabbour, C. J. C. (2017). “Green training for sustainable procurement? Insights from the Brazilian public sector”. Industrial and Commercial Training, 49(1), 48-54.

[63] Katsikeas, C. S., Leonidou, C. N., & Zeriti, A. (2016). “Eco-friendly product development strategy: antecedents, outcomes, and contingent effects”. Journal of the Academy of Marketing Science, 44, 660-684.

[64] Chuang, S. P., & Huang, S. J. (2018). “The effect of environmental corporate social responsibility on environmental performance and business competitiveness: The mediation of green information technology capital”. Journal of business ethics, 150, 991-1009.

[65] Schauerte, R., Feiereisen, S., & Malter, A. J. (2021). “What does it take to survive in a digital world? Resource-based theory and strategic change in the TV industry”. Journal of Cultural Economics, 45(2), 263-293.

[66] Harsanto, B., & Permana, C. T. (2021). “Sustainability-oriented innovation (SOI) in the cultural village: an actor-network perspective in the case of Laweyan Batik Village”. Journal of Cultural Heritage Management and Sustainable Development, 11(3), 297-311.

[67] Markman, G. D., Russo, M., Lumpkin, G. T., Jennings, P. D., & Mair, J. (2016). “Entrepreneurship as a platform for pursuing multiple goals: A special issue on sustainability, ethics, and entrepreneurship”. Journal of Management Studies, 53(5), 673-694.

[68] Gulluscio, C. (2023). “Legitimacy Theory. In Encyclopedia of Sustainable Management “(pp. 2209-2215). Cham: Springer International Publishing.

[69] Ahn, S. Y., & Park, D. J. (2018). “Corporate social responsibility and corporate longevity: The mediating role of social capital and moral legitimacy in Korea”. Journal of Business Ethics, 150, 117-134.

[70] Sulthonuddin, I., & Herdiansyah, H. (2021). “Sustainability of Batik wastewater quality management strategies: analytical hierarchy process”. Applied Water Science, 11, 1-12.

[71] Maryani, A. T., Dewi, S., Syarifuddin, H., & Wibowo, Y. G. (2023). “Strategy for Liquid Waste Management for Batik Industry in Ulu Gedong Village, Jambi, Indonesia”. Ecological Engineering & Environmental Technology, 24.

[72] Baumgartner, R. J., & Rauter, R. (2017). “Strategic perspectives of corporate sustainability management to develop a sustainable organization”. Journal of Cleaner Production, 140, 81-92.

[73] Guenster, N., Bauer, R., Derwall, J., & Koedijk, K. (2011). “The economic value of corporate eco‐efficiency”. European financial management, 17(4), 679-704.

[74] Mosgaard, M., Riisgaard, H., & Huulgaard, R. D. (2013). “Greening non-product-related procurement–when policy meets reality”. Journal of cleaner production, 39, 137-145.

[75] de Oliveira Santos, H., Alves, J. L. S., de Melo, F. J. C., & de Medeiros, D. D. (2020). “An approach to implement cleaner production in services: Integrating quality management process”. Journal of Cleaner Production, 246, 118985.

[76] Roscoe, S., Subramanian, N., Jabbour, C. J., & Chong, T. (2019). “Green human resource management and the enablers of green organisational culture: Enhancing a firm's environmental performance for sustainable development”. Business Strategy and the Environment, 28(5), 737-749.

[77] Ding, Z., Yi, G., Tam, V. W., & Huang, T. (2016). “A system dynamics-based environmental performance simulation of construction waste reduction management in China”. Waste management, 51, 130-141.

[78] Negash, Y. T., Sarmiento, L. S. C., Tseng, M. L., Lim, M. K., & Ali, M. H. (2021). “Engagement factors for household waste sorting in Ecuador: Improving perceived convenience and environmental attitudes enhances waste sorting capacity”. Resources, Conservation and Recycling, 175, 105893.

[80] Chen, H., Hao, Y., Li, J., & Song, X. (2018). “The impact of environmental regulation, shadow economy, and corruption on environmental quality: Theory and empirical evidence from China”. Journal of Cleaner production, 195, 200-214.

Downloads

Published

2025-05-29

Conference Proceedings Volume

Section

Articles

How to Cite

Challenges and strategies for enhancing environmental performance in Indonesia’s batik industry. (2025). BIS Economics and Business, 2, V225022. https://doi.org/10.31603/biseb.268

Similar Articles

11-20 of 31

You may also start an advanced similarity search for this article.