Report on SME Sustainability and the Sustainable Development Goals (SDGs)

Introduction

Small and medium-sized enterprises (SMEs) constitute 90% of businesses worldwide and contribute between 40% and 60% of greenhouse gas (GHG) emissions in the business sector. Despite their significant environmental impact, SMEs remain one of the most under-supported groups in the global sustainability transition. This report highlights the critical role of SMEs in achieving the Sustainable Development Goals (SDGs), particularly those related to climate action and economic growth.

Key Findings from the World Economic Forum White Paper

The World Economic Forum, in collaboration with Schneider Electric, released a white paper titled Sustainability Meets Growth: A Roadmap for SMEs and Mid-Sized Manufacturers. The report emphasizes that accelerating the sustainability transition in SMEs can substantially advance the achievement of the Paris Agreement targets and stimulate economic growth, aligning with SDG 13 (Climate Action) and SDG 8 (Decent Work and Economic Growth).

1. Shift in Perspective: Sustainability is evolving from being seen as a cost to a strategic growth opportunity for SMEs.
2. Five-Stage Roadmap: The report provides a practical framework for SMEs and mid-sized manufacturers to integrate environmental sustainability into their operations and strategies.
3. Support Mechanisms: It outlines necessary public and private sector support, including access to finance, knowledge-sharing, networks, policy guidance, and implementation assistance.

Role of SMEs in Climate Action and Sustainable Development

• SMEs are critical players in global supply chains and can act as powerful multipliers of climate action, contributing to SDG 9 (Industry, Innovation, and Infrastructure) and SDG 12 (Responsible Consumption and Production).
• The report stresses that sustainable transformation offers SMEs a competitive advantage amid evolving economic and regulatory environments.
• Meeting the Paris Agreement goals requires global GHG emissions to peak before 2025 and decline by 43% by 2030, a target that SMEs can significantly influence.

Challenges Faced by SMEs

Despite growing awareness, SMEs face several obstacles in adopting sustainability practices:

• 53% cite competing priorities such as cost pressures and business expansion.
• 47% identify policy uncertainty as a barrier.
• 42% report financial constraints.

Recommendations for Enabling SME Sustainability

The report recommends a collaborative approach involving both public and private sectors to support SMEs, tailored to their unique needs. Key enablers include:

• Access to sustainable finance (supporting SDG 17: Partnerships for the Goals)
• Knowledge-sharing platforms and networks
• Clear policy guidance and regulatory frameworks
• Implementation support to integrate sustainability into business models

Conclusion

Empowering SMEs and mid-sized manufacturers to lead sustainable transformation is essential for a resilient and inclusive global economy. Aligning SME sustainability efforts with business growth is not only feasible but critical to limiting global warming to 1.5°C, thereby advancing multiple SDGs including SDG 13 (Climate Action), SDG 8 (Decent Work and Economic Growth), and SDG 12 (Responsible Consumption and Production).

Upcoming Event: Annual Meeting of the New Champions 2025

The 16th Annual Meeting of the New Champions will be held from 24 to 26 June 2025 in Tianjin, People’s Republic of China. Under the theme “Entrepreneurship for a New Era,” the meeting will gather over 1,700 leaders from various sectors to explore entrepreneurial solutions addressing global challenges, further supporting the SDGs through innovation and collaboration.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 9: Industry, Innovation and Infrastructure
   • The article focuses on small and medium-sized enterprises (SMEs) and mid-sized manufacturers, highlighting their role in sustainable industrialization and innovation.
2. SDG 13: Climate Action
   • The article discusses the importance of reducing greenhouse gas (GHG) emissions and meeting the Paris Agreement targets to limit global warming to 1.5°C.
3. SDG 8: Decent Work and Economic Growth
   • It emphasizes leveraging sustainability as a growth opportunity for SMEs, linking economic growth with environmental sustainability.
4. SDG 17: Partnerships for the Goals
   • The article calls for collaborative support mechanisms between public and private sectors to enable SME sustainability transitions.

2. Specific Targets Under Those SDGs Identified

1. SDG 9 Targets
   • Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes.
2. SDG 13 Targets
   • Target 13.2: Integrate climate change measures into national policies, strategies, and planning.
   • Target 13.3: Improve education, awareness-raising and human and institutional capacity on climate change mitigation, adaptation, impact reduction, and early warning.
3. SDG 8 Targets
   • Target 8.4: Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation.
4. SDG 17 Targets
   • Target 17.17: Encourage and promote effective public, public-private and civil society partnerships, building on the experience and resourcing strategies of partnerships.

3. Indicators Mentioned or Implied to Measure Progress

1. GHG Emissions Reduction
   • Percentage reduction in greenhouse gas emissions by SMEs and mid-sized manufacturers, aligned with the Paris Agreement goals (e.g., 43% decline by 2030).
2. SME Sustainability Adoption
   • Proportion of SMEs implementing sustainability measures and integrating environmental sustainability into their operations and business strategies.
3. Access to Support Mechanisms
   • Availability and utilization of finance, knowledge-sharing platforms, networks, and policy guidance tailored for SMEs.
4. Policy and Regulatory Environment
   • Level of policy certainty and support for SMEs in sustainability transitions.

4. Table: SDGs, Targets and Indicators

Source: eco-business.com