SME Responses to Climate Change in Southeast Asia

Micro-, small- and medium-sized enterprises (SMEs) account for approximately 97 per cent of all active business entities within the ASEAN region. They are an important contributor to both emissions generation and future reduction.

A recent large-scale, multi-country quantitative assessment was undertaken into how SMEs are dealing with climate change in Indonesia, Malaysia, the Philippines, Singapore and Vietnam. Most respondents reported a high level of concern about climate change.

Over 90 per cent of firms are currently undertaking measures to reduce emissions, albeit that they are typically simple steps such as reducing air conditioning and electricity, recycling or installing low-energy lighting.

Common intentions to deal with future extreme weather events include reducing emissions, developing a disaster plan, or reviewing business insurance policies.

Major obstacles to dealing with climate issues are firstly, a lack of knowledge and secondly, insufficient funds. Governments are the preferred source of information, followed by business associations/chambers, friends and family. Social media, YouTube and websites are overwhelmingly the dissemination modes of choice. There were significant variations in these patterns from one reporting country to another.

Policymakers can help SMEs adjust to climate change by: encouraging them to adopt simple emission reduction measures; providing training and financial support; ensuring appropriate online delivery of advisory and assistance measures; and localizing responses to meet the needs of SMEs which are specific to different ASEAN member states.

Michael T. Schaper is a Visiting Senior Fellow with the ISEAS – Yusof Ishak Institute, Singapore and an Adjunct Professor with the John Curtin Institute of Public Policy, Curtin University, Western Australia.