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Enabling SMEs to promote climate changemitigation and adaptation

Global Programme PSACCAngelika Frei-Oldenburg

Engaging the private sector for green growth and climate change, workshop organised by OECD and DCED,

Paris, 1 March 2016

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• Objectif principal: mettre au point et tester des instruments pour le renforcement des capacités du secteur privé en vue de l’adaptation au changement climatique

Central America

Morocco

Bangladesh

Rwanda

Objective: Concepts and instruments for strengthening capacities of the private sector in order to adapt to climate change impacts are identified, enhanced, assessed and disseminated.

Target Group: SMEs in developing and emerging countries (no farmers)

Duration: 2014 - 2017

Global Programme PSACC

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General Approach

Climate-resilient andCompetitive Private Sector

Sensitization Capacity Building Financing Knowledge & Mainstreaming Mechanism Network

Strengthen thedialogue andcooperation on effective approacheswithin German andinternational developmentcooperation

Raising awareness ofprivate sector actors in terms of actions andopportunitiesregarding CC impacts

Anchoring instrumentsto enhance theadaptability of theprivate sector & theuse of businessopportunities from CC

Testing instrumentsfor the use of thefinancial sector tofinance adaptation toCC and providingadvisory services on adaptation financingfor SME

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A business approach to adaptation:���� Ensuring business survival and growth

New products/ services

Direct risks

Risk and opportunity assessment

Indirect risks

•Create new products/services

• Increase efficiency • Anticipate regulation• Improve reputation• Tap into new funding

streams

• Build resilience and avoid future costs

Business opportunity

Competitiveadvantage

Riskmanage-

ment

Adaptation assures survival and enables growth of businesses in times of changing climate

Why adapt?

Growth

Survival

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Products - Our approach is integrating several aspec ts

Developing a Methodology for Climate Risk Management

Awareness Raising for Companies

Train of Trainer for dissemination

Information on Finance Mechanism

• Awareness Raising Workshops• Company Case Studies• Various communication activities

• Vulnerability Assessment and adaptation Strategy and Measures (Tools, Cost-Benefit)

• Manual for Industrial Zones (IZ)

• Training manual for SMEs • Training manual for IZ managers

• GAP Analysis Adaptation Needs • Advisory/ Manual on Adaptation

financial instruments for SME• Case Study

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Methodology –The Four Step – Assessment for the Private Sector

Exposure to CC

CC Risk and OpportunityAssessment

Identification of CC adaptationmeasures

Cost- Benefit Analysis

Developing and communicating a CCA Strategy

Assessment of past experiences with CC impactsAssessment of expected CC impacts

Online-Tool developed in the MME Programm in India and available under

www.climate-expert.in

Select measuresto be implemented

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Methodology –How is Climate Change Effecting Enterprises

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Impact Areas Risks (due to CC impacts) Adaptation op tions Buildings / Infrastructure

• Facilities and premises flooded • Stocks under water

• Adapting the pavement at the entrance • Integrating flood barriers

Processes • Disruption in water supply• Power cuts & overheating of fridges

• Integrating sustainable water management system, new recycling plant

• Awareness raising of employees (water)• New insulation materials

Logistics and Stock

• Decreasing available fish stocks • Disruption in logistics & supply chain (blocked

roads during floodings)

• Supplier diversification for fish exports to Europe & product diversification for canned food

• Support suppliers with weather alert system

Employees & Communities

• Deterioration of working conditions & decrease in productivity during heat waves

• Include more green spaces at the company premises

• Optimise indoor ventilation

Government & regulations

• Stricter regulations on environmental issues• Increased water prices

• Monitoring system on environmental regulations

Market • Higher constraints and requirements from international clients on climate and environmental issues

• CSR reporting

Finance • Higher requirements from banks in terms of climate issues

• New financing opportunities

• Research on available green finance opportunities in Morocco

First Results – Assessment in Fishing industry

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Two ideas for the financing challenge

Water is a crucial adaptation issue for industries as droughts and heat waves

are critical incidents for companies

-> Why not establishing credit lines for SMEs that are rel ated on water

efficiency (cost saving approach)?

In order to distinguish adaptation additionality for Financial Insitutions

-> Why not integrating certificated CC Risk (vulnerabil ity) assessment

approaches for companies as basis for special adaptation cr edits/

grants?

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