Small businesses have huge potential to supercharge the green economy transition, but are at risk of being left on the side-lines.
15 December 2022 Blog by Chris Hopkins, Economic policy lead, Green Economy Coalition
The transition to a greener economy is picking up speed. Countries around the world are seeing the opportunities of an economic model that is built on renewable resources, sustainable growth, and deeper alignment with nature and human wellbeing. There is clamour from citizens and scientists alike to act and address the climate crisis and other pressing environmental challenges, even as economies continue to develop.
UN Secretary General António Guterres has called for a ‘renewable energy revolution’, and to “[shift fossil fuel] subsidies to vulnerable people that want to engage in the green economy.” At the Green Economy Coalition (GEC), we agree wholeheartedly – and see micro, small and medium-sized enterprises (MSMEs) as powerful actors in this new economic model.
As we show in our new report with Finance Watch, small businesses account for up to 90% of jobs in many countries (especially emerging economies), and contribute between one-quarter and over half of all economic activity.
Yet small businesses are inadvertently cut out from participating in the green economy – by a lack of access to finance, a lack of recognition of the social and environmental value they bring, and from recourse to exemptions from environmental regulations, leading to a race to the bottom and leaving local green enterprises struggling to compete.