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The Ethiopian government has been working intensively by identifying prioritized sectors that deserve series attention to build the required platform for the industry to play the key role in the economy of the nation. Among these prioritized sectors, Leather & leather products industry is found at the most top lists. Leather Industry Development Institute has an environmental as well as economic concern and is striving for the sustainability of the sector. An assessment is made on the status of the tanneries & based on their gaps, mitigation measures and solutions are proposed so as to enhance the environmental management capacity of the industries.