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Aqueel I. Wahga, Richard K. Blundel and Anja Schaefer

As part of a broader effort to reduce environmental degradation, small- and medium-sized enterprises (SMEs) around the world are increasingly being required by different stakeholders to adopt more environmentally responsible business practices. While there is some research on what motivates SMEs to adopt environmental practices, our understanding of what enables SMEs to engage with environmental issues remains much more limited. Even less is known about motivations and enablers of SME environmental engagement in developing economies. The chapter addresses this gap by exploring the influence of human capital on environmental engagement of SMEs in Pakistan’s leatherworking industry. We found that human capital influences environmental practices in such SMEs in the form of both formal education and informal environmental learning. Environmental interventions by industry associations and other agents, such as chemical suppliers, as well as SMEs’ participation in environmental networks also had an impact on their environmental engagement. Well-designed and executed interventions by third parties have the potential to promote large scale improvements in environmental performance of this industry sector. Furthermore, awareness programmes should aim not simply to educate entrepreneurs and employees, but also to inspire them to pursue environmental opportunities.