During the Economist’s “Week Insight Hour” session, the topic of “the Green Industrial Revolution” was brought to light. There were many discussions on the initiatives of the different sectors taken on global sustainability issues. However, one interesting take was with respect to SMEs’ challenges and their opportunities in this regard.
SMES WANT TO PLAY THEIR PARTS
SMEs have the same appetite to start decarbonizing as large businesses, if not more. These enterprises recognize the growing mega-trend which heavily affects today's consumer behavior. They know that to capture future demand, it is essential to start the transition as soon as possible.
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However, what SMEs can now do merely includes lowering energy consumption and dealing energy efficiency issues. This is because they lack the investment necessary to fund large-scale and innovative sustainability projects. Furthermore, in this current economic situation whereby global challenges like inflation and supply chain distribution continue to be of great threats to businesses, SMEs are forced to be in survival mode. All they can afford to do now is to focus on cost reduction.
WHAT REMAINS TO BE DONE?
A survey cited by the Economist states that 66% of SMEs feel that they lack the knowledge and data to deal with emissions tangibly, and 70% feel that they lack the funds. All in all, much more effort is required to help SMEs succeed in their sustainability initiatives. For instance, to successfully tackle the issue of having inadequate funds to take action, collaborations in research and development is vital. On top of that, the efforts to measure emissions must be implemented so that businesses know where to start.
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It is crucial to recognize the roles of SMEs and take in account the part they play as well as the weight they can pull in this global fight against carbon emissions. After all, small businesses contribute a large portion of the economy (for instance, 44% of American GDP) and, therefore, global carbon emissions.
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