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Transition of enterprises of various organizational and legal forms of ownership to environmentally oriented production

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The paper substantiates the authors’ vision of the sequence of actions and activities in the transition of enterprises of various organizational forms of management to environmentally oriented (green) agricultural products making. An organizational-economic mechanism for the functioning of environmentally oriented agricultural production is presented, which, according to the authors, acts as a sequence of actions in the implementation of interdependent organizational-economic, innovative-technological and management activities aimed at the optimal organization of agricultural production in the process of transition of agricultural producers to environmental management principles.
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International Journal of Mechanical Engineering and Technology (IJMET)
Volume 9, Issue 11, November 2018, pp. 1372–1381, Article ID: IJMET_09_11_141
Available online at http://www.iaeme.com/ijmet/issues.asp?JType=IJMET&VType=9&IType=11
ISSN Print: 0976-6340 and ISSN Online: 0976-6359
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IAEME
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Scopus Indexed
TRANSITION OF ENTERPRISES OF VARIOUS ORGANIZATIONAL
AND LEGAL FORMS OF OWNERSHIP TO ENVIRONMENTALLY
ORIENTED PRODUCTION
Voronkova O. Yu
Altai State University, Barnaul, Russia
Sycheva I. N
I.I. Polzunov Altai state technical university, Barnaul, Russia
Lomova L. A
Southwest State University, Kursk, Russia
Seliverstova M. A
Sochi State University, Sochi, Russia
Frolova I. I
Kazan Innovative University named after V.G. Timiryasov, Kazan, Russia
Stepanenko O. G
East-Siberian Branch of the FSBEIHE, the Russian State University of Justice,
Irkutsk, Russia
ABSTRACT
The paper substantiates the authors’ vision of the sequence of actions and activities
in the transition of enterprises of various organizational forms of management to
environmentally oriented (green) agricultural products making. An organizational-
economic mechanism for the functioning of environmentally oriented agricultural
production is presented, which, according to the authors, acts as a sequence of actions in
the implementation of interdependent organizational-economic, innovative-technological
and management activities aimed at the optimal organization of agricultural production
in the process of transition of agricultural producers to environmental management
principles.
Keywords: Organizational and Economic Mechanism, Greening, Land Use Ecology,
Organic Products, Certification.
Cite this Article: Voronkova O. Yu, Sycheva I. N, Lomova L. A, Seliverstova M. A,
Frolova I. I and Stepanenko O. G, Transition Of Enterprises of Various Organizational and
Legal Forms of Ownership to Environmentally Oriented Production, International Journal
of Mechanical Engineering and Technology, 9(11), 2018, pp. 1372–1381.
http://www.iaeme.com/IJMET/issues.asp?JType=IJMET&VType=9&IType=11
Voronkova O. Yu, Sycheva I. N, Lomova L. A, Seliverstova M. A, Frolova I. I and Stepanenko O. G
http://www.iaeme.com/IJMET/index.asp 1373 editor@iaeme.com
1. INTRODUCTION
Justifying the methodological approaches to the creation of an organizational-economic
mechanism for the functioning of environmentally oriented agricultural production, it is advisable
to present the very concept of the mechanism and identify its main elements in relation to the
current process [1]. Based on the idea of a mechanism as a specific sequence of states or processes
causing some or other impact or phenomenon, the organizational and economic mechanism of
transition of enterprises to environmentally oriented production acts as a combination of factors
and measures aimed at ensuring sustainable integrated development of agricultural production
through its greening, the purpose being to create an effective agricultural production of
ecologically safe and quality products, to preserve or reproduce soil fertility, as well as to improve
the current state of the environment [2].
Consequently, the organizational-economic mechanism for the functioning of
environmentally-oriented agricultural production, in the authors’ opinion, is a sequence of actions
in the implementation of interdependent organizational-economic, innovative-technological and
management activities aimed at the optimal organization of agricultural production in the process
of transition of agricultural producers to the environmental management principles.
1.1. Justification of the studied problem
In the process of conducting research on domestic agricultural production, in particular, Altai
Region, it was concluded that in the past two decades various organizational and legal forms of
management have been established and are functioning in the agricultural sector, therefore, the
transition to environmentally oriented agricultural production must meet the goals and
development strategies of each individual agricultural enterprise [3-5].
Given the incompatibility in size and diversity of the organizational and legal forms of
agricultural enterprises, the authors offer the following directions for organizing the transition of
enterprises to environmentally oriented production:
In integrated agrarian entities and large agricultural enterprises, the transition to greening
production is assumed through the creation of optimal conditions for the formation of eco-
economically efficient geo-ecosystems through rational land use with the minimum required level
of chemicalization in crop cultivation processes [6-13];
For organizational-legal forms of management that are small in terms of production, it seems
expedient to separate the environmental areas of their activities into a separate production unit
(subsidiary). In large agricultural enterprises and holdings, it is preferable to form separate
internal production units specializing in making environmentally safe agricultural products, in
accordance with the regulatory provisions of ecological agricultural production standards [14;
15], with the complete rejection of chemicalization.
2. METHODOLOGY
To optimize the implementation of the greening process in agricultural enterprises, based on a
comprehensive analysis of land-resource potential, real opportunities should be identified for
transition to this sphere of production activity both at the regional level and at the corporate level,
and on the basis of the information received, the economic feasibility of the transition to
environmentally friendly agricultural production should be identified [16; 17].
Based on the world experience of greening agriculture in the creation and operation of
environmentally oriented enterprises of small organizational forms, their production activities
should be organized in strict accordance with the norms of environmental standards with the
complete abandonment of chemicalization, using in agricultural production only organic and
natural mineral fertilizer systems and plant protection products [18-21].
Transition Of Enterprises of Various Organizational and Legal Forms of Ownership to
Environmentally Oriented Production
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When making a decision by an agricultural enterprise on the transition to environmentally
oriented production, the management of the enterprise will have to solve a set of tasks: select the
type of eco-products to be made in accordance with the demands of the market; to determine the
most optimal variant of the transition to greening today, this can be expressed by a complete
transition of the enterprise to the ecological principles of economic management, transition of a
separate production branch or an internal business unit [22-24], transformation of the crop
rotation system. As a result, the enterprise needs to adjust the existing organizational structure;
train specialists; master innovative production technologies; form a marketing system for
environmentally friendly products. A feature of the certification system for an environmentally
oriented enterprise is that not the final manufactured product is subject to certification, but the
entire process of production and processing, in this case only after that the enterprise’s products
are officially recognized as environmentally friendly and safe for the consumers [25-35].
3. RESULTS
As a result of the research, the authors have developed and proposed a specific algorithm for the
sequence of actions and activities in the transition of enterprises of various organizational forms
of management to environmentally oriented agricultural production. The essence is that, based
on the established soil fertility, climatic, organizational, economic, social environmental
conditions and market needs, optimal conditions are created for increasing economic efficiency
of greening an agricultural enterprise through the organization of crop production, based on the
effective structure of sown areas, given by the system of environmentally safe interchange of
crop rotation fields. This algorithm is a phased sequence of actions and activities in the transition
of agricultural enterprises to environmentally oriented production.
In large-scale agricultural enterprises, it seems more correct to organize ecologically oriented
production based on the principles of rational land use, designating the production and economic
purpose of each land plot based on the results of a comprehensive environmental and economic
assessment of all land plots of the enterprise. This procedure will allow developing a system of
organizational, economic, innovative, technological and managerial measures aimed at
optimizing land use, taking into account the existing potential of the enterprise, the qualitative
and ecological state of land resources and the needs of consumers.
Table 1 Algorithm of actions and activities in the transition of enterprises of various organizational
forms of management to environmentally oriented agricultural production
No
Large organizational forms of agricultural production
(financial agricultural production groups, farming firms,
agriholdings, agricultural production cooperatives, farm
(family) enterprise associations)
Small organizational forms of agricultural
production (farm (family) enterprises, LLC, sole
traders, personal subsidiary farms)
1 Marketing research of external and domestic market of
organic products [36].
Marketing research of domestic market of
organic products and related consumer needs
[36].
2
Laboratory assessment of land and the environment in the
area of the enterprise’s operation in connection with
environmental safety and the possibility of cultivating
environmentally friendly crop products
Laboratory assessment of land and the
environment in the area of the enterprise’s
operation in connection with environmental
safety and the possibility of cultivating
environmentally friendly crop products
3
Development of an investment project for the transition to
greener production. Assessment of available and required
resources. Expert evaluation of the investment project
[37]
Land resource assessment. Development of a
business plan for the transition to
environmentally oriented production.
Voronkova O. Yu, Sycheva I. N, Lomova L. A, Seliverstova M. A, Frolova I. I and Stepanenko O. G
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4
Selection of the optimal variant of transition to
environmentally friendly production (enterprise as a
whole, separate production branch / structural unit)
Applying for state financial support for the
project (grants, subsidies, employment center
programs)
5
Self-assessment of the company's activities in the field of
environmental management, inviting (training) of internal
auditors in quality management systems.
Attracting investors to the project, finding
markets, concluding long-term contracts with
enterprises for the processing of organic products
6
Preparation of a package of documents and submission of
an application to a certification authority to confirm the
environmental status of an enterprise (enterprise’s
products)
Development of the optimal structure of sown
areas and rotational rotation system, their
ecological and economic assessment
7
Start of the production process in accordance with the
environmental principles and standards of international
environmental management
Attraction of labor resources, purchase of
machinery, seeds, carrying out of ecological
agrotechnical methods [38]
8
Conducting advertising campaigns, conclusion of
contracts for the supply of products to major retail chains
and processing enterprises
Preparation of a package of documents and
submission of an application to a certifying
authority to confirm the ecological status of an
enterprise (enterprise’s products)
9 Entrance of the enterprise to foreign markets
Start of production activities aimed at
ecologization of land use
10
Expansion of the land use area at the expense of the lands
of the distribution fund, lease, including the involvement
of fallow and unused lands in the turnover
If necessary, an increase in the area of land use at
the expense of the lands of the distribution fund,
lease, including fallow and unused lands
11
Applying for state financial support for environmentally
friendly production activities (reimbursement of the
interest rate on investment loans, deferment of income
tax)
Entry into associations (unions) of producers of
organic products in order to optimize the
marketing and sales system, obtaining consulting
and information
12 Further improvement of the environmental quality
management system of products
Further improvement of the environmental
quality management system of products
The authors consider it necessary that one of the initial stages in the development of actions
and measures for the transition of enterprises of various organizational forms of management to
environmentally oriented agricultural production should be the obligatory laboratory assessment
of soil samples and air and water samples in the area of enterprise’s operation by a competent
accredited state laboratory to check their environmental safety and the ability to produce
environmentally friendly plant products [39-42].
In Altai Region and Altai Republic, such a laboratory can be the federal state “Central
Scientific and Production Veterinary Radiological Laboratory”, which is accredited to perform a
wide range of services in environmental and radiological research. Its competent work in this area
has been confirmed by the Federal Service for Veterinary and Phytosanitary Surveillance
(Rosselkhoznadzor) and FAPAS international tests. The laboratory is monitoring the residues of
prohibited and harmful substances in soil samples, products of plant and animal origin, in
particular, in the framework of the implementation of the WTO requirements.
The use of laboratory assessment of the soil and environment will allow enterprises to develop
a system of organizational, economic, innovative, technological and managerial measures in the
direction of green use of land in accordance with the qualitative and ecological condition of the
land and the market demand for organic products [43]. Of great importance is the optimization
of the system of alternating fields of crop rotations, since it is they which act as a reserve for
increasing economic efficiency within an enterprise’s transition to green principles of agriculture
[44-46].
Transition Of Enterprises of Various Organizational and Legal Forms of Ownership to
Environmentally Oriented Production
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In the previously existing Rosgiprozem’s (Republican State Design Institute for Land
Management) system, inland assessment activities, environmental requirements for land use were
not taken into account and the current environmental status of agricultural land was not reflected.
The main activity of Rosgiprozem was aimed at intensifying agricultural production at the
expense of land already used in production, as well as by involving more land in agricultural
production. As a rule, land plots of enterprises are now soils of various degrees of economic
suitability, and heterogeneous qualitative and ecological state. As a result, when making an
informed decision on the greening production, it is advisable to carry out an environmental
assessment of enterprises’ land resources with the goal of typing land and creating a system of
interchanging crop rotations fields, as well as forming a plan for organizational, economic,
innovative, technological and managerial activities seeking to rationally use the land.
Based on the results of a comprehensive environmental assessment of the state of land fund
of an enterprise and identifying the factors of land degradation, a basis is created for planning
measures for rational land use based on the introduction of adequate soil, climatic, landscape and
organizational-economic conditions for agricultural production. Then, a strategy is being worked
out for the expanded reproduction, preservation and restoration of soil fertility through the
introduction of an environmentally safe system of interchanging crop rotation fields, ensuring a
positive balance of humus in the soil via the introduction of green technologies with a minimum
level of chemicalization [47]. At the same time, a plan is being developed to provide the
agricultural enterprise with its own forage, seed stock and organic fertilizers.
Modern scientific studies show that the stability of agricultural production, its economic and
environmental efficiency is determined by the degree of stability of the agricultural landscape,
being based on the quality state and rational use of land at an agricultural enterprise.
Unfortunately, with the transition of the economy to market principles [48; 49] and the
emergence of new organizational forms of land ownership, agricultural producers are more
focused on market demands rather than on scientifically based patterns of agro-ecological
systems functioning. The system of interchanging crop rotation fields plays a minor role, resulting
in depletion of soil fertility and a decrease in the efficiency of agricultural production. As a result,
crop rotations should be considered as an autonomous ecological-economic system, designed to
ensure the efficiency of agricultural production [50-53].
When switching to organic agricultural production, the rotation of crops must take into
account the specifics, qualitative and ecological state of individual land plots [59], availability of
the necessary material and technical production facilities, market demand for organic products,
dynamics and seasonal fluctuations in prices, etc. Crop rotations should be planned on the basis
of the identified land categories according to their suitability for agricultural production [54; 58].
An important economic principle for the formation of crop rotation structure in the course of a
transition to green production is the reproduction of soil fertility due to the rational circulation of
elements and energy [55; 56]. This can be achieved only with the optimal combination of fodder,
grain and industrial crops, taking into account heterogeneous soil fertility [57; 59-60]].
4. CONCLUSION
From the above, one can conclude that the organizational-economic mechanism for the transition
of enterprises to environmentally-oriented agricultural production in various organizational forms
of enterprises is mainly aimed at improving the economic and environmental efficiency of crop
production industry. Effective implementation of the proposed mechanism is based on a set of
actions and measures to optimize crop production through rational land management with the use
of an adaptive landscape system and greening the interchange of crop rotation fields.
Formation of the methodological basis of the greening process in agricultural production on
the basis of a systematic approach, is offered to be considered by the authors as the interaction of
Voronkova O. Yu, Sycheva I. N, Lomova L. A, Seliverstova M. A, Frolova I. I and Stepanenko O. G
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interdependent ecological and economic processes towards ensuring the efficiency of agricultural
production by improving the ecological quality of land and products made. Based on this
approach, the authors have developed a mechanism for the transition of agricultural producers to
environmentally-oriented crop production, and proposed an algorithm for organizational,
economic, innovative, technological, marketing managerial measures to implement the proposed
mechanism.
In order to form a national market for environmentally friendly products, the organization of
specialized green agricultural enterprises is required, based on international environmental
standards for agricultural production. Advertising and marketing of environmentally safe
products of these enterprises will be possible only after receiving a certificate of passing by an
enterprise of the environmental certification of manufacturing and obtaining a license to use the
trademark "green product".
The decision by an agribusiness on the feasibility of a transition of manufacturing products
to the environmental principles of management should be based on a comprehensive assessment
of the prevailing spatial, climatic, ecological, organizational and socio-economic conditions of
the region and a particular enterprise. Comprehensive assessment also involves the analysis of
the existing system of land use at the enterprise, the efficiency of land management, financial,
material, labor and other production resources, distribution channels for the products, road and
other production infrastructure [58].
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