Small and medium-sized businesses are worried about climate change, but a BMO Climate Institute survey said few have plans to address it.
The institute operates to bridge policy with science and finance to prepare the market for a decarbonized economy. It surveyed 600 businesses in Canada and the U.S. between October 18 and 21, 2022.
It said 69 per cent of respondents expected climate change to disrupt their operations over the next five years, and almost a third said they already feel the impact. However, only 24 per cent have decided what they will do.
Small and medium-sized businesses make up 98 per cent of all operations in Canada and employ 70 per cent of the workforce, so the issue is critical. Still, business owners feel they receive little help from the government. Just nine per cent feel supported by political leaders.
Many business leaders said they see opportunities to partner with banks to meet climate change goals, and 17 per cent said their financial institutions are already fulfilling this role. However, half think their banks could do more. Eighty per cent of small and medium companies said they'd welcome any insight their banks might have.
"The BMO Climate Institute commissioned this survey to seek a deeper understanding of how small and medium-sized businesses -- fundamental participants in a successful energy transition -- view climate change and the associated risks and opportunities," said Susan McGeachie, the head of the institute. "We weren't surprised most SMEs don't yet have a climate change plan in place. We were surprised to learn that so many of them are already feeling its impact."
The results stand in contrast with large organizations which are already taking action to manage greenhouse gas emissions throughout their supply chain. According to the institute, they are increasingly asking suppliers to report their greenhouse gas emissions so they can ultimately cut their carbon footprint.
Only 15 per cent of smaller organizations view greenhouse gas reduction as their top climate-related impact. The survey found 44 per cent believe severe and unpredictable weather poses a more immediate risk. As a result, the institute believes they could be missing opportunities to transition to a lower carbon economy.
"Many of these companies are part of the supply chains of much larger organizations," said McGeachie. "This is a gap that will need to close."
McGeachie added Canada still lacks economic incentives to decarbonize, "particularly when the costs associated with addressing climate change are highly uncertain."