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By Pallavi Ahuja
Sustainability for MSMEs: With a large coastal population, high levels of heat exposure and risk of concurrent flood and droughts, India is one of the countries which is most vulnerable to climate change. The Intergovernmental Panel on Climate Change (IPCC) continues to warn that emissions must be halved by the year 2030 to limit the worst impacts of climate change, yet emissions continue to climb, increasingly putting the country at risk.
We must urgently adapt to remedy a rapidly warming world – countries, companies and people alike. While countries are increasingly developing climate aligned policy frameworks and regulations, big companies are leading the way with ambitious decarbonisation targets, compliances and transformational business models.
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However, these companies are still missing a key piece of the climate puzzle. The majority of large corporation’s greenhouse gas emissions come from their supply chains – the businesses that are supplying their goods, materials, and services. In fact, supply chain emissions are on average over 10 to 11 times higher than the emissions produced within a corporation’s own walls.
In India alone, there are over 60 million micro, small and medium sized enterprises (MSMEs) employing over 110 million people. Although the individual footprint of each company may seem small, together, they have a massive impact on the climate. It is critical that these businesses reduce their carbon footprint at the speed and the scale required to effectively reach net zero and help limit the worst impact of climate change, which disproportionately effects SMEs themselves.
In a recent survey conducted by the SME Climate Hub, Indian SMEs reported having a strong will to create a better future for their business and for the planet. They recognise the need to take action and are stepping up in the fight against climate change. In addition to reducing their own emissions, MSMEs can also help to promote climate action and awareness of the issue among their communities.
However, with limited resources, little knowledge and funding constraints, it can be extremely challenging for SMEs to strategise their action plan. Ensuring small business can effectively reduce their emissions requires them to have relevant skills, technologies and an understanding of the changing ecosystem.
Initiatives like the SME Climate Hub aim to help small businesses on their journey to mitigate their environmental impact and build resilient businesses for the future. The SME Climate Hub offers a suite of free tools and resources to help SMEs decarbonize and benefit from the transition. Resources include Climate Fit, a free online training course specifically designed for SMEs to help them better understand how to join the collective race to net zero and integrate climate transition plans within their business.
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The transition to a climate-safe world with net-zero emissions is inevitable and has already begun. The challenge is not how, but when we will make the necessary strides towards reductions.
Presently, there are over 120 Indian MSMEs, that have made a net zero commitment through the SME Climate Hub. Businesses, large and small, are reinventing their operations to be fit for the future, and positioning themselves as leaders for the markets of tomorrow, ensuring they are competitive, relevant and profitable. The resources are available. Now, every business, no matter the size, needs to stand up and take action.
Pallavi Ahuja is the Manager of Systems Transformation at We Mean Business Coalition. Views expressed are the author’s own.
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