Mukt Shabd Journal ISSN NO : 2347-3150

Green Entrepreneurship in Theory and Practice

Gouri RV,
Research Scholar in Commerce,
University of Kerala,
Thiruvananthapuram.

ABSTRACT
The increasing concerns about climatic change and sustainable development have led to considerable
shift in Indian markets. The consumers, today, prefer green products over traditional products as move
towards becoming environmentally and socially responsible. Thus many companies are updating and
redesigning their products keeping a greener perspective. Hence the idea of green entrepreneurship is
slowly and steadily gaining a strong hold in Indian markets. This study is explorative in nature as it
provides insights on the emergence of the concept of green entrepreneurship and its role in the Indian
context. Based on the available literature, this study provides a conceptual suggestion model that
describes the connection between environmental, economic and social factors responsible for the
development of green entrepreneurship which leads to the achievement of sustainable development.
The opportunities and challenges faced by the green entrepreneurs are also explored in the light of the
initiatives taken up by the business firms and government of India. This study sheds light on the idea
of green entrepreneurs and their role as innovators to introduce green manufacturing technologies and
create environmental friendly products and services to increase the job opportunities and thereby
keeping a check on the green economy. The study concludes that green entrepreneurs are drivers of
changing this economy greener. They contribute to the minds of the people to green thinking and
consumption. This will in turn helps in boosting environmental and economic gains.

Key words: Green Entrepreneurship, Environmental Degradation, Sustainable Development Goals.

INTRODUCTION

Environmental degradation is perhaps the biggest concern of academic experts, policy makers,
government and civil societies all over the world in the 21stcentury. Recently established Sustainable
Development Goals (SDGs) have been gaining worldwide acceptance and awareness is growing all
over the world about environmental degradation and scarcity. Thephenomenon of climatic change not
only changed the balance of ecology, but possesses serious threat to the stability of economies as well.
In the context of growth in economic gains, widespread decline in natural systems followed. This
shows that the natural environment has reached its limits. Thus there arises a conscious effort to
change the consumption and production pattern according to environmental and social dimensions.
The traditional attempts to solve ‘why’ and ‘how’ to environmental problems can be made greener or
eco-friendly. However, it soon became apparent that the objective of becoming greener can be
achieved only if sincere efforts are taken from the inception of the company. Thus entrepreneurs with
innovate business solutions should come up to address the social and environmental challenges for a
sustainable future. In the light of this need, a new category of entrepreneursis slowly rising to meet the
sustainability concerns.

The term ‘Green Entrepreneur’ was coined by Berle in 1991. Since then, there are a lot of
arguments for and against it. However, there is still more to be answered in this regard like: what are
the main ideas that make Green Entrepreneurs, how can they be defined wisely and how to distinguish
them from the non-Green Entrepreneurs. So there arise a need for a detailed analysis on how these
green entrepreneurs conceive an idea and incubate and acquire new commercial ventures, gather

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resources to develop them and finally putting their plan into action in order to run a business
profitably

In the present era of industrialisation, India is also developing to keep up the pace with the
globalisation. But in this mad rush, the Earth’s resources are being exploited and they are depleting.
Therefore Green entrepreneurs are vehicles of change. They play an important role in sustainable
development. The changes in global climate also tend people to shift to green production and
consumption in the recent decades. The tastes and preferences of Indianconsumers are switching to
environment friendly products and services. This led to the emergence of green markets in India.
Green entrepreneurship concept uses the innovative concepts and develops new products not only to
cater to the needs of the consumers but also to participate in the e of sustainable development in the
long run.Hence green entrepreneurs act as a link between innovation and sustainability. Green
commodities are those which are eco-friendly or packaged in an environment friendly way.

This study aims at studying the emergence and evolution of the concept of green entrepreneurship
and exploring the main factors that contribute to this phenomenon. This study also takes into
consideration a few case studies of successful green initiatives. The role of government and private
sectors are also examined in this study. In the conclusion part, suggestions to overcome the barriers
for sustainable development are given.

REVIEW OF LITERATURE

In the recent decades, there have been considerations among the policy makers regarding the
determinants of the green growth. An important one among seems to have escaped notice is that what
policy makers ad economist ultimately need is a green entrepreneurship model. (Farinelli et al., 2011).
Green entrepreneurs are economic actors, whose central role is to make ideas into reality into
commercially profitable ventures.

The interaction between environment, sustainability and entrepreneurship were referred to by

the researchers using different terminologies like ‘green entrepreneurship’ (Berle, 1991), ‘Eco
entrepreneurship’ (Schaper, 2002), ‘ecopreneurship’ (Schaper, 2002) and ‘environmental
entrepreneurship’ (Keogh &Polonsky, 1998). But Dean and McMullen (2007) argue that
sustainability and entrepreneurship are different concepts and green entrepreneurship can be of no
substitute to it. The sustainable entrepreneurship tries to create a balance between people, desire and
profit (Elkington, 1998). On the contrary, the green entrepreneurship is all about the environment and
creation of financial benefits (Thomson, Kiefer, York, 2011).The different definitions of green
entrepreneurship can be classified on the basis of the levels of entrepreneurship they refer to.

The first attempts to define the green entrepreneur and describe his/her characteristics are in
the 1990s. Hall (2013) mentions that the term “green entrepreneurship” appeared for the first time in
the book “The Green Entrepreneur: Business Opportunities That Can Save the Earth and Make You
Money” by Gustav Berle (1991). Berle’s definition is short, quite poetic, morally focused and maybe
quite accurate: “Green entrepreneurship is taking responsibility to create the world we dream of.”

As noted by Farinelli et al. (2011), a correct understanding and clear definition of green
entrepreneurship models becomes especially important in a reality where big corporations prefer to
invest in green marketing (creating a green image without real, measurable and strategically directed
change in their business processes) rather than in green innovations.

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Gibbs (2009) observes that sustainable entrepreneurship bases itself upon Schumpeter’s
fundamental concept of “creative destruction” and today it has the potential to break the current
economic model which exhausts the Earth’s resources without being able to substitute them with
others or to leave them enough time to replenish themselves naturally. Sustainable entrepreneurship
can turn into the driving force for the emergence of a new holistic sustainable system in the three
dimensions – economy, environment, and society.

According to Kotchen (2009, p.28), green entrepreneurship is “The practice of starting new
businesses in response to an identified opportunity to earn a profit and provide (minimise) a positive
(negative) environmental externality”

Anderson and Leal (1997, p.3) referred green entrepreneurs as “Entrepreneurs using business
tools to preserve open space, develop wildlife habitat, save endangered species and generally improve
environmental quality”.

Dean and McMullen (2007, p.53) defined green entrepreneurship as “The process of defining
and exploiting economic opportunities that are present in environmentally relevant market failures”

In his study, Shaper (2010) attempted to integrate a framework for intelligently defining green
entrepreneurship based on the wide range of ideas and literature available in this paper. Although this
phenomenon is quite different, he argues that in principle, green entrepreneurs can be distinguished
from traditional entrepreneurship and its counterparts in terms of three distinct features. Shaper (2010)
proposes that green entrepreneurs share the first feature in common with its counterparts. In this
regard, his findings are in line with the findings of Thompson, Kiefer and York (2011), who stated in
a later study that all green entrepreneurs identify market opportunities, access to resources and make
their venture profitable in the long run. So, like traditional entrepreneurs, every green
entrepreneurialactivityis entrepreneurial. The second characteristic of green entrepreneurs is that it
differentiates them from their competitors, the net effect of their commercial venture on their natural
environment and the development of sustainability. However, Shaper (2010) has not proposed any
method for evacuating the negative and positive effects of an enterprise.Thirdly, Shaper (2010) states
that the goals, values and aspirations of green entrepreneurs deviate from the path of commercial
entrepreneurs.

With an increasing awareness of the threats of climate change, there has been a change in the
consumption pattern and this has opened up new opportunities for entrepreneursare emerging in the
green market (Paramashivaiah et al., 2013).A new species associated with this phenomenon, which
are zealous, moves their entrepreneurial attitudes towards environmentalism for an ecological society
(Allen &Malin, 2008). So environment concerned entrepreneurs who focus on sustainable
development can be called as Green Entrepreneurs or Ecoprenuers. According to Nikolaou et al.
(2011) green entrepreneurship may be defined as a new business start – up in production industry or
environmental services which focus on preservation of natural conditions or natural resources such as
eco – tourism, wastewater treatment, recycling, renewable energy and biodiversity. In the emerging
green market scenario in India, green entrepreneurs focus on carrying out their business by keeping
environmental conservation in their mind for the welfare of the society. Although there is a large
literature available in the area of entrepreneurship till date, it was accepted as a formal discipline only
in 1980s.Further, green management is again a newer concept and it gained attention in 1990s.Thus
the concept of green entrepreneurship is less researched and less well known compared to
entrepreneurship

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Most authors mention the following characteristics as inherent to green entrepreneurs:

 They act as entrepreneurs, realizing ideas with a high level of risk

 They have strong internal motivation related to a heightened sensitivity to environmental
problems
 They address an environmental/social problem/need consciously and this is at the core of their
business activity
 Their business activities have a net positive effect on the natural environment and at the same
time they are financially sustainable
 They consciously strive to contribute to a more sustainable future, contributing both with their
social and environmental values.

OBJECTIVES OF THE STUDY

1. To get a conceptual view of Green Entrepreneurship

2. To identify the Factors contributed and Challenges faced by Green Entrepreneurs in India
3. To provide suggestions to promote Green Entrepreneurship in India.

RESEARCH METHODOLOGY

The study explores the concept of ‘green entrepreneurship’ using all the available secondary
literature sources such as research papers, websites and innovator’s interviews on print and digital
media. Based on the available literature, a conceptual model is derived about green entrepreneurs who
facilitate a connection between environmental, economic and social factors for greener Indian
markets.

Green Entrepreneurship-A Conceptual Model

According to the study, the pioneers in the field of entrepreneurship and management used the
term ‘environmental entrepreneur’, ‘green entrepreneur’, ‘Ecoprenuers’, etc. Terry Clark from
Goizueta Business School, Emory University coined the term Green Entrepreneurs.The term green
entrepreneur is a combination of two terms namely, environment and entrepreneurship.Ecoprenuers
are important for economic development because they are important in providing employment and are
considered as a driving force for change and they are commended for introducing innovations,
adopting new ideas and developing and responding to rapid change. The combination of
environmental, economic and social goals creates strategies that increase competition, benefit society
and lead to active entrepreneurship and innovation to solve the problems of the environment. One of
the studies reveals that three main sociological constructs in green business, namely, personal
motivation and mission, leads to sustainable development in the long run. Based on this study of
green entrepreneurs, a figure has been developed, which shows its structure, depicted in Figure 1.

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ENVIRONMENT

SOCIAL
SUSTAINABILITY
OBJECTIVES
GREEN
ENTREPRENUER

INNOVATION TECHNOLOGY

Figure 1: Composition of Green Entrepreneurs

Green Entrepreneurs In India

The recent debates on the emergence of green entrepreneurs drew attention to the need for
exploring the various dimensions of this new class of entrepreneurs in the scenario of developing
countries. To dig into the socio-cultural factors and motivations that shape green entrepreneurs and
the challenges they face at all levels, 10 green entrepreneursare considered. All of these innovative
ventures are started by entrepreneurs who are from are diverse socio-economic and cultural
backgrounds but driven by the general purpose of creating with the help of their innovative ventures.
The analysis of these cases reveals the ecological, social and economic impact of green
entrepreneurship development in India.

1. Go Green BOV by Dhivik Reddy, 29years, Bangalore: Increased concern about global
warming and fuel prices made Dhivik Reddy realise that only electric vehicles are going to
gain prominence in near future. In 1996, his father Ashok Reddy has introduced Landri
conversion kits to turn petrol and diesel into liquefiedpetrol gas, which motivated Dhivik to
go for a greener environment. Reddy’s Go Green BOV(Battery Operated Vehicle) formed as
a venture under their company ACTD Electronics and Electricals in 2007 to manufacture
electric 2 wheelers ranging from Rs.28,000 to Rs.48,000, which don’t burn the fuel, thus no
smokeemission. One can travel by this bike up to 120km with a fully charged battery. The
buyers of these bikes were encouraged to plant a sapling. The Go Green BOV has a unit in the
Kolar District in addition to this there are 96 dealers in South India. Further they have
received many enquiries fromBrazil, Philippines, Australia and other European countries for
electric vehicles
2. Biotech Bags by T.S. Shankar, 46 years: In 2010, he founded Biotec Bags with an investment
of Rs.1 crore, along with his friends Ravi Iyer, 50 and K N Laxman, 60 for making
biodegradable plastic bags. These bags costs Rs.200/kg are coated with a food grade enzyme.
In 180 days, 90% of the bag is decayed.
3. Herbal Products by RajaramTripathi, 49years: Tripathi felt that the main cause of raising
debts of farmers is due to the wasteful cost of pesticides and fertilizers. His team uses farm
made organic fertilizers including leaves and cow dung. His farms also use bio-wastes.A
group of 200 tribesmen markets this with the help of Central Herbal Agro Marketing
Federation of India. They set up a plant for food related production with an annual turnover of
Rs.20 crores.

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4. Natural Khadi by Mini VarkeyShibu, 46 years: Mini believes in “khadinomics”. With her
husband, Kocheri C Shibu, who works at a hydraulic company in Himachal Pradesh, Mini, an
NID graduate, opened her first retail store for eco-friendly fashion dresses in December 2007
in Bangalore. The store is called MINC, short for 'mini' couture, to promote the youth to buy
eco-friendly fabric. The intention of her venture was to attract youngsters to the eco-friendly
wears to conserve the values of India’s rich heritage. All of the Fabric used in the store are
organic and are from the adivasis of the Dharmapuri district of Tamil Nadu. Strictly no
chemical fertilizers are applied.
5. Green Oil by AnupamJalote, 46 years: Green oil produces organic fertilizer and sells it in
small quantities under the brand name of Green Oil Karishma. The company is in the process
of building a 1MW power plant connected to the National Grid in the village of Samod near
Jaipur.It’s like a modern gobar gas plant produce bio-methane through anaerobic digestion.
Rotten fruits, vegetables, cattle and elephant dung and other organic farm produce can be
used to produce electricity from waste.The company will also sell fertilizers as organic by
products. He aims to build 10 power plants of 1 MW each in 5 years. The company’s current
revenue is R.3 lakhs to Rs.4Lakhs.
6. Green Gold by Surendranath, 53 years: Surendranath started an NGO in 1996 called Uravu,
leaving his job in the field of journalism, by joining the interested people from different walks
of life. Inspiration of Uravu was founded from various social movements related to
environmental protection, livelihood problems and dangers of unregulated development. It
focuses on building houses and crafts using bamboo.
7. Biomass pellet by Mahesh Yagnaraman, 48 years &MukundDeogaonkar,
47years:Yagnaraman and Deogaonkar joined First Energy, a subsidiary of BP energy, in
2006. They came forward with Oorja Biomass pellet stove, a year later, in collaboration with
Indian Institute of Science in Bangalore. They started by targeting houses in rural and small
towns by encouraging house wives to quit cooking in chulha.Substituting stoves with
firewood reduces pollution and deforestation. The pellets are made of peanut husks and
agricultural waste, to make sure that the farmers don’t burn the wastes.
8. Mitti Cool fridge by MansukhlalRaghavjibhai Prajapati,48years: In 2002, Prajapati started the
Mitti Cool Fridge for commoners using clay. It works without electricity. The perishables are
kept fresh for 7 days, the water is cold and milk and yogurt fresh for about 24 hours. He is
currently working on Mitty Cool Houses, a cool house without any consumption of additional
power.
9. Healthy detergent by PreethiSukumaran, 34 years and SrinivasKrishnaswamy, 36 years: This
Chennai based duo has always been environmentally conscious. They, in 2011, they launched
their own company, Krya Consumer Products in 2011, which produces household products
with natural ingredients. Their first product was Krya natural detergent powder that saves 25
Litres of water per wash compared to other chemical detergents. But, this detergent is more
expensive than the normalones
10. Chalk and Chuckles toys by PallaviomenAgarwal, 35 years and PrachiAgarwal, 30 years:
These sisters make interactive toys for children of all ages. They don’t use plastic; all their
toys are made of cardboard. All the inks used in the games are soybean based and in paints
turpentine is not used.

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ANALYSIS

Opportunities available to the Green Entrepreneurs

The growing environmental concerns like pollution, climate change, greenhouse gases
emissions and global warming made a paradigm shift in customer preferences towards eco-friendly
products. This change in the consumption patterns has led to the emergence of green markets due to
increased education and awareness on environmental issues by inculcating innovations and
redesigning of the production and supply chains. Green business opportunities lead to the emergence
of socially and environmentally motivated entrepreneurs. The connection between environmental
concerns, green markets, green entrepreneurs and Sustainable Development are shown in Figure 2
below.

ENVIRONMENTAL EMERGING GREEN SUSTAINABLE

CONCERNS GREEN MARKET ENTREPRENUERS DEVELOPMENT

Climatic Change, Green Products, Green challenges, Human

development
Carbon Emission, Eco-labelling, Green business,
Economic
Pollution, Green Consumers, Social and development
economic goal,
Global Warming Innovation and Environmental
redesign Green idea and development
innovation.
Social
development.

Figure 2: Connection between environmental concerns, green markets, green

entrepreneurs and Sustainable Development

Challenges for Green Entrepreneurs

The biggest challengefor green entrepreneurs is creating customer value through

innovative products and cost control. Along with this another task is consumer education
on environmental hygiene. However, green entrepreneurs face challenges such as lack of
alternatives for the traditional commodities, cost control, redesign, lack of proper research
and development facilities. These challenges can be reduced if the right support is
received from all stake holders.

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Conceptual Model for Green Entrepreneurship

Based on the study, the following conceptual model of Green Entrepreneurship is

suggested:

Conceiving an Idea

Collecting information and checking if

required resources are available

Identifying Opportunities and

Threats

Converting the opportunity into

action by overcoming the threats

Green Entreprenuership outcome

Findings of the Study

From the above cases, it can be inferred that there are opportunities for green entrepreneurs to link
their new business ideas to a wider range of environmental issues. Hence they can motivate others to
convert their ideas into reality.

i. India has the best resources and opportunities for fostering Green entrepreneurship
ii. There is a link between environmental issues, green entrepreneurs and sustainable
development.
iii. As people are more concerned about the environment now, many prefereco-friendly products.
This helps in boosting the green entrepreneurs.
iv. Green market is an emerging market with a lot of scope for further advancements.
v. As we look into the drivers for green innovations, it is observed that they are all inspired from
environment or social goals rather that financial motives.

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Suggestions

i. To raise awareness of the community regarding green entrepreneurship, socially

responsible projects can be prepared with Role models.
ii. Due to the cooperation between universities and industries, environmental technology can
be improved and thereby having the green entrepreneursgets this technology at low cost.
iii. Local bodies and business incubators play an important role in green entrepreneurship.
Their support may be an opportunity for green business and local entrepreneurs.
iv. Eco friendly gardens can be set up on roof tops to supply for a particular area.

CONCLUSION

From the study it can be identified that green entrepreneurship has got a lot of opportunities for
beginners... customers shift towards eco-friendly products is paving way for more green businesses.
The success stories of green entrepreneurs in India highlight the importance of flourishing green
business here. However, it also has their own opportunities and challenges.

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