7 out of 10 Manufacturing Companies Say "Environmental Regulations Are a Heavy Burden"

'Actual Conditions of Corporate Burden from Environmental Regulations and Policy Support Tasks'
Chemical Substance Management, Total Air Emission Regulation Burdens

[Asia Economy Reporter Dongwoo Lee] Seven out of ten domestic manufacturing companies reported a significant burden due to environmental regulations. In response, companies have requested expanded government support to comply with these regulations.

The Korea Chamber of Commerce and Industry (KCCI) recently surveyed 305 domestic manufacturing companies on the "Actual Conditions of Corporate Burden from Environmental Regulations and Policy Support Tasks," revealing on the 19th that 76.0% of companies responded that the current level of environmental regulatory burden is 'high.' Those who answered 'average' accounted for 22.3%, and only 1.7% said 'low.'

The most burdensome environmental regulations were identified as 'Chemical Substance Management' (18.4%), 'Total Air Emission Regulation' (16.1%), 'Air Concentration Regulation' (15.1%), 'Chemical Substance Registration and Evaluation' (13.1%), 'Waste Management' (11.8%), 'Integrated Environmental Management' (7.9%), 'Resource Circulation Management' (7.2%), and 'Fine Dust Reduction Measures' (6.6%), in that order.

By company size, large enterprises cited 'Total Air Emission Regulation' (34.2%) as the most burdensome, mid-sized companies pointed to 'Chemical Substance Management' (24.8%), and small and medium-sized enterprises (SMEs) identified 'Waste Management' (25%) as the most challenging regulation.

Regarding difficulties with environmental regulations, companies most frequently cited 'investment costs for regulatory compliance' (45.5%), followed by 'excessive administrative procedures and paperwork' (31.5%), and 'lack of technology' (23.0%).

KCCI analyzed that the reason companies feel the environmental regulatory burden is high is due to the implementation of several regulations this year, including the expanded application of facility safety standards under the Chemical Substances Control Act, nationwide expansion of total air emission regulations, and a 30% strengthening of air concentration regulations compared to the previous year.

Companies plan to increase environmental investments to comply with the strengthened regulations. Among respondents, 68.4% said they plan to 'expand' environmental investment over the next three years (2020?2022) compared to the past three years (2017?2019). Those who said 'remain about the same' accounted for 30.9%, and only 0.7% planned to 'decrease.'

When asked about the extent of investment increase, companies planning to expand environmental investment reported an average increase of 56.6%. By size, large enterprises (61.8%) and mid-sized companies (60%) showed higher increases than SMEs (44.6%). By industry, petrochemical and refining sectors (87.5%) had the highest increase, followed by fine chemicals (67.7%), power generation (40.8%), and steel (38.1%).

Although companies bear the investment cost burden to respond to environmental regulations, many are not utilizing government support policies.

When asked about experience using government support programs related to environmental investment, 86.9% of companies answered 'no.' The main reasons for not using these programs were 'support targets limited to SMEs, etc.' (77.4%), followed by 'lack of practical help' (12.8%), and 'lack of information' (9.4%).

Regarding government support policies, companies collectively voiced the need to expand support targets and scales to better fit corporate realities. As improvements to government support systems, companies prioritized 'expanding the scale and targets of environmental investment support' (55.4%), followed by 'on-site technical support for companies' (33.8%), 'strengthening incentives for excellent companies' (8.8%), and 'support for regulatory compliance' (2.0%).

The areas where government support is most needed were identified as 'air' (55.4%), followed by 'chemical substances' (25.6%) and 'waste' (17.7%). Specific support tasks by sector included ▲ expanding tax credit rates and eligible targets for environmental conservation facilities ▲ expanding installation support targets for stack automatic measuring systems (TMS) ▲ expanding and regularizing fast-track approval for chemical substances ▲ expanding waste treatment infrastructure.

Kim Nok-young, Director of the Sustainable Management Center at KCCI, stated, "Many companies are making efforts such as expanding environmental investments, but the rapidly increasing environmental regulations are intensifying the burden of regulatory compliance on companies. We hope the government will actively consider expanding support for companies so they can smoothly implement the strengthened environmental regulations."

This content was produced with the assistance of AI translation services.