Green SMEs: Catalyst for Green Economy

With ‘green’ being the buzzword across all industries, greening of the business sector and development of green skills has assumed greater importance all over the world. SMEs, startups and ecopreneurs are playing a vital role in the transition to a low-carbon economy by developing new green business models for different industrial sectors. Infact, young and small firms are emerging as main drivers of radical eco-innovation in the industrial and services sectors.

Green SMEs

What are Green SMEs

Green SMEs adopt green processes and/or those producing green goods using green production inputs. A judicious exploitation of techno-commercial opportunities and redevelopment of business models, often neglected by established companies, have been the major hallmarks of green SMEs.

For example, SMEs operating in eco-design, green architecture, renewable energy, energy efficiency and sustainability are spearheading the transition to green economy across a wide range of industries. The path to green economy is achieved by making use of production, technology and management practices of green SMEs. Impact investment platforms allows individuals to invest in environmentally sustainable companies.

Categories of Green Industries

Environmental Protection Resource Management
Protection of ambient air Water management
Protection of climate Management of forest resources
Wastewater management Management of flora and fauna
Waste management Energy management
Noise and vibration abatement Management of minerals
Protection of biodiversity and landscape Eco-construction
Protection against radiation Natural resource management activities
Protection of soil, groundwater and surface water Eco-tourism
Environmental Monitoring and Instrumentation Organic agriculture
Research and Development Research and Development

Key Drivers

The key motivations for a green entrepreneur are to exploit the market opportunity and to promote environmental sustainability. A green business help in the implementation of innovative solutions, competes with established markets and creates new market niches. Green entrepreneurs are a role model for one and all as they combine environmental performance with market targets and profit outcomes, thus contributing to the expansion of green markets.

Some of the popular areas in which small green businesses have been historically successful are renewable energy production (solar, wind and biomass), smart metering, building retrofitting, hybrid cars and waste recycling.

As far as established green industries (such as waste management and wastewater treatment) are concerned, large companies tend to dominate, however SMEs and start-ups can make a mark if they can introduce innovative processes and systems. Eco-friendly transformation of existing practices is another attractive pathway for SMEs to participate in the green economy.

The Way Forward

Policy interventions for supporting green SMEs, especially in developing nations, are urgently required to overcome major barriers, including knowledge-sharing, raising environmental awareness, enhancing financial support, supporting skill development and skill formation, improving market access and implementing green taxation.

In recent decades, entrepreneurship in developing world has been increasing at a rapid pace which should be channeled towards addressing water, energy, environment and waste management challenges, thereby converting environmental constraints into business opportunities.

About Salman Zafar

Salman Zafar is the CEO of BioEnergy Consult, and an international consultant, advisor and trainer with expertise in waste management, biomass energy, waste-to-energy, environment protection and resource conservation. His geographical areas of focus include Asia, Africa and the Middle East. Salman has successfully accomplished a wide range of projects in the areas of biogas technology, biomass energy, waste-to-energy, recycling and waste management. Salman has participated in numerous national and international conferences all over the world. He is a prolific environmental journalist, and has authored more than 300 articles in reputed journals, magazines and websites. In addition, he is proactively engaged in creating mass awareness on renewable energy, waste management and environmental sustainability through his blogs and portals. Salman can be reached at salman@bioenergyconsult.com or salman@cleantechloops.com.
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