Quantcast
Environmental News for a Healthier Planet and Life

Help Support EcoWatch

3 Ways Small Business Plays Huge Role in Fighting Climate Change

Climate
3 Ways Small Business Plays Huge Role in Fighting Climate Change

One of the biggest outcomes of the recent UN Climate Summit came from the private sector, where, side by side with world leaders, 1,042 multinational corporations (MNCs) pledged their support for carbon pricing. Twenty-five of these companies—including Nestle, Unilever and Philips—even committed to price their own carbon internally to reduce emissions themselves.

Farmers in Cambodia are threatened by the impacts of climate change. Photo credit: Asladhrra, Flickr

This move is significant, as MNCs have a central role in planning for the impacts of climate change. However, if they are not already doing so, business leaders can go a step further by also making their supply chains—often made up of small businesses in developing countries—more resilient.

In most of the developed world, large corporations, such as those who pledged at the UN Climate Summit, are the main driver of economic growth and job creation. But that is not the case in most of the developing world, where micro- and small-sized businesses are the economic engines. Ensuring that the whole private sector has the capacity to adapt to climate change can support the resilience of populations everywhere.

Here’s a look at the reasons why small businesses have to play a significant role in mitigating and adapting to climate change:

1. Small businesses are best suited to reach vulnerable communities in low-income countries.

Despite their large financial and operational resources, MNCs do not have the same impact as small businesses in preparing the most vulnerable communities to be more resilient to extreme weather. The populations who will and already are experiencing the worst social and economic effects of climate change are the marginalized and poor populations who live in low-income countries. The World Trade Organization estimates that about 60 percent of all employees in developing countries work in micro and small businesses. In Sub-Saharan Africa, for example, these businesses account for 90 percent of all firms and make up about 25 percent of GDP. Because the majority of vulnerable populations rely on these businesses for their livelihoods, it is vital that they become climate-resilient and are given more priority in climate discussions.

2. If small businesses are resilient, so are communities.

Micro and small businesses are oftentimes the most direct contributors to a stable economy in low-income countries, providing a strong labor force, access to markets, and steady incomes. Climate-proofing the private sector—particularly at the small business level—will not only benefit business-owners, but also employees, households, and others in the extended value chain. For example, in Cambodia, farmers learned new techniques to increase their crop yields while managing scarce resources. By installing irrigation systems and planting new varieties, farmers produced more crops, ensuring food security to the nearby community even when faced with the impacts of climate change.

These businesses could also provide resilient goods and services to their communities—such as offering drought-resistant cassava instead of maize or corn, which are sensitive to climate variability—contributing to household adaptation. As such, the private sector would become a valuable ally in building climate-resilient communities and societies from the bottom up.

3. Vulnerable populations have the fewest resources to adapt to climate change.

The poor in developing countries are oftentimes highly dependent on the natural environment and have few savings and safety nets to adapt to a changing climate. In Africa, for example, at least 80 percent of the rural poor derive their primary income from employment in small businesses in agriculture, a sector highly susceptible to climate change because of its reliance on natural resources. Without proper risk management and planning, climate impacts like droughts and floods could have long-term impacts on development, creating chronic hunger, displacement, and an uneducated or unhealthy population. Without a strong private sector to support local livelihoods, vulnerable communities are even more exposed to the effects of climate change.

Creating Resilient Small Businesses

MNCs can help in these efforts by strengthening the resilience of their suppliers. However, many more micro- and small businesses not linked to MNCs will also need support. Thus, the public sector becomes an important player in implementing policies and providing financial resources, incentives, and support to help small businesses to adapt to climate change.

WRI’s Vulnerability and Adaptation team is currently researching ways that the private sector—including small businesses—can help create climate-resilient communities.

YOU MIGHT ALSO LIKE

ALEC Is Lying About Climate Change Google Chairman Tells Diane Rehm

World Leaders Say Addressing Climate Change Offers Unprecedented Opportunities for Economic Growth

Companies Warn Investors Climate Change Threatens Their Bottom Line

In an ad released by Republican Voters Against Trump, former coronavirus task force member Olivia Troye roasted the president for his response. Republican Voters Against Trump / YouTube

Yet another former Trump administration staffer has come out with an endorsement for former Vice President Joe Biden, this time in response to President Donald Trump's handling of the coronavirus pandemic.

Read More Show Less

EcoWatch Daily Newsletter

Climate Group

Every September for the past 11 years, non-profit the Climate Group has hosted Climate Week NYC, a chance for business, government, activist and community leaders to come together and discuss solutions to the climate crisis.

Read More Show Less

Trending

A field of sunflowers near the Mehrum coal-fired power station, wind turbines and high-voltage lines in the Peine district of Germany on Aug. 3, 2020. Julian Stratenschulte / picture alliance via Getty Images

By Elliot Douglas

The coronavirus pandemic has altered economic priorities for governments around the world. But as wildfires tear up the west coast of the United States and Europe reels after one of its hottest summers on record, tackling climate change remains at the forefront of economic policy.

Read More Show Less
Monarch butterflies in Mexico's Oyamel forest in Michoacan, Mexico after migrating from Canada. Luis Acosta / AFP / Getty Images

By D. André Green II

One of nature's epic events is underway: Monarch butterflies' fall migration. Departing from all across the United States and Canada, the butterflies travel up to 2,500 miles to cluster at the same locations in Mexico or along the Pacific Coast where their great-grandparents spent the previous winter.

Read More Show Less
The 30th First Annual Ig Nobel Prize Ceremony on Sept. 17 introduced ten new Ig Nobel Prize winners, each intended to make people "laugh then think." Improbable Research / YouTube

The annual Ig Nobel prizes were awarded Thursday by the science humor magazine Annals of Improbable Research for scientific experiments that seem somewhat absurd, but are also thought-provoking. This was the 30th year the awards have been presented, but the first time they were not presented at Harvard University. Instead, they were delivered in a 75-minute pre-recorded ceremony.

Read More Show Less

Support Ecowatch