Request Free Trial
April 9, 2024

SMEs see benefits of climate action but demand more policy support

Electric car charging station
A majority of respondents to SME Climate Hub’s survey say they engage in emissions reduction efforts as they believe it offers ‘cost savings and return on investment’ (Photo: Nhac Nguyen/AFP via Getty Images)

Small and medium-sized enterprises are calling for supportive policies and government-sponsored benefits to help them increase their climate action

A majority of smaller companies (62 per cent) say “taking climate action” enhances their reputation and brings a variety of other benefits, shows a survey by the SME Climate Hub, a non-profit initiative led by the We Mean Business Coalition and the Race to Zero. 

Fifty-three per cent of the companies surveyed, all with fewer than 500 employees, said climate action leads to “increased business differentiation”, while 40 per cent responded that reducing emissions and becoming more sustainable offers branding benefits.

As to why they engage in emissions reduction efforts, 63 per cent of the 288 companies across 44 countries and 25 sectors said they believed it was “the right thing to do”, while 52 per cent said it offers “cost savings and return on investment”, and 46 per cent said it allows businesses to “get tax benefits or other government funding”.

Despite recognising the advantages of climate action, SMEs identified a number of barriers to greening operations. Fifty-two per cent of companies said a “lack of policies or government-sponsored benefits” was the main barrier to climate action, while the same figure cited “insufficient funding” as the top barrier.

Indeed, to take more climate action, 66 per cent of the surveyed SMEs said they needed greater financial support, 65 per cent called for more government incentives, and 52 per cent underlined the importance of “tools for measuring and monitoring emissions”.

The survey also showed a low understanding among SMEs of how to access climate funding. A majority of respondents (62 per cent) rated their knowledge about funding for climate action as “very poor”, while 22 per cent classified their understanding as moderate, and only 13 per cent said their understanding was high.

The report is available to read here.

A service from the Financial Times