Climate Change: Quick Guide for SME business
What is Climate Change?
Weather patterns across the globe are changing - summers are hotter, storms more intense, and winters milder in many places. This global phenomena is called “climate change” or “global warming"
These changes are caused by the release of “greenhouse gasses” such as carbon dioxide from combustion. While some release of carbon dioxide is natural and absorbed by nature, burning fossil fuels has tipped our climate out of balance.
There are many efforts to reverse this trend - these are often called “decarbonization.” For locations already experiencing the impact of climate change, efforts are being taken to adapt to our new reality in “climate adaptation”
Why does it matter?
Climate change has broad consequences, both to society as a whole, and for your business. The impacts of climate change include:
Physical risks to assets and infrastructure from storms, erosion, wildfires, and sea level rise. For businesses, this can mean higher insurance prices, supply chain disruptions, and catastrophic losses.
Limited water supply as weather patterns change, so can the availability of groundwater and rain. This can have a large impact on agriculture and other water-intensive businesses.
Increased disease risk. As temperatures rise, mosquito-borne tropical diseases can impact new areas.
Biodiversity loss as temperature-sensitive species lose their homes, or lifecycles fall out of synch. For example, birds may lay eggs at the same time of year, while the bugs to feed the young arrive earlier or later due to temperature changes.
How can I measure my contribution?
Carbon footprint refers to the amount of greenhouse gasses an individual, product, or business contributes to global warming. These can be called GHG footprints, GHG emissions, or other names. These are a proxy for your contribution to global climate change, and can compare between sources.
Measuring your carbon footprint is a complex subject - check out our dedicated article to learn how to navigate this topic.
How does climate change impact a SME?
Climate change will impact some SMEs more than others, and there is a range of ways your business could be impacted:
Increased risk and insurance costs: physical risks such as storms, flooding, and wildfires can directly translate to your insurance bill. For example, home insurance costs rose rapidly in California after the 2025 wildfires. Avoiding locations where these risks are high can save you money.
Customer requests: for B2B companies with large customers, you may be asked to provide information about your carbon footprints as your customers comply with their own regulations (such as the CSRD) or voluntary reporting (e.g. GHG Protocol). As a supplier to a larger organization, you form part of their value chain and are an important part of Scope III emissions.
Opportunities to grow: customers, large and small, are beginning to prioritize suppliers that align with their sustainability ambitions. When combined with smart marketing, transparency, and customer experience, the price premium can be even higher. Additionally, large companies striving to reduce their value chain impacts prefer suppliers who can demonstrate controlled risks, measure their impact, and are working to reduce it.
Cut costs and GHG emissions by increasing energy efficiency or smart investments in renewable energy. Cutting costs directly increases your profits, and can set your business apart to customers who care about climate.
What can I do about it?
There are opportunities to improve both your business operations and impact on climate change. Start by discovering whether climate change is the issue your business should focus on with our Quick Sustainability Assessment, and get in touch to develop your strategy for creating value together.
