Tackling the climate crisis requires the net zero transition of millions of SMEs around the world. Although SMEs have a relatively small individual environmental and carbon footprint, their aggregate contribution to greenhouse gas emissions is significant, estimated at 50-70% of the GHG emissions of the business sector. Yet most SMEs are currently at the very beginning of the journey to net zero, facing considerable knowledge, capacity and resource constraints. Most notably, a large share of SMEs lack the awareness of the steps they need to take to advance in the net zero transition, which curbs their demand for sustainable finance and investment. At the same time, SMEs face considerable financing constraints when they do seek to undertake net zero investments. The first annual conference of the OECD Platform on Financing SMEs for Sustainability will explore the drivers and constraints to the provision and uptake of sustainable finance for SMEs as well as the policies, instruments, tools, and approaches that public and private actors in the SME finance ecosystem can use to improve SME access to sustainable finance.
The conference brought together high level participants from the public sector (policy makers, public financial institutions, SME agencies, financial sector regulators, etc.), private financial institutions, ecosystem actors, SMEs, researchers and practitioners to explore the key drivers, challenges and potential solutions to the provision and uptake of sustainable finance for SMEs. Discussions were centred on a number of key questions:
- What are the latest developments in the landscape for sustainable finance for SMEs? How can we leverage finance to accelerate the green transition for SMEs?
- What is driving the demand for sustainable finance, and what obstacles need to be lifted to strengthen the provision of finance for small businesses?
- What instruments are best suited to finance SMEs’ sustainability projects?
- How can Fintech companies support SMEs in integrating environmental considerations into their operations?
- How can non-financial services and support be strengthened to help accelerate SMEs’ green transition?
- What are the key priorities for future action?
