8 December 2015: Focusing on micro and small enterprises (MSEs) is critical to climate change adaptation because these businesses provide livelihoods for the world’s poor, who are particularly vulnerable to climate change, according to a report by the UN Development Programme (UNDP) and the World Resources Institute (WRI). UNDP and WRI launched the report on the sidelines of the Paris Climate Change Conference.

Titled ‘Adapting from the Ground Up: Enabling Small Businesses in Developing Countries to Adapt to Climate Change,’ the report argues that governments, climate finance providers and large corporations should encourage micro and small businesses in developing countries to invest in adaptation and support efforts to build resilience. The report emphasizes that small businesses are well positioned to build climate resilience because they are embedded in communities and work in vulnerable sectors such as agriculture.

Speaking at the report launch, UNDP Administrator Helen Clark highlighted the importance of including small businesses in the agriculture, fisheries, forestry and livestock sectors in climate change adaptation efforts, describing these sectors as crucial “to build resilience to climate change.” She said strengthening the resilience of micro and small enterprises will strengthen communities’ resilience.

The report proposes six steps through which decision-makers can select policy options for their business community: engage stakeholders; prioritize vulnerable sectors; identify drivers to invest in adaptation; identify barriers preventing investment in adaptation; design interventions to catalyze MSE investment in adaptation; and implementation and scale-up. It suggests policy-makers help small businesses build resilience and adapt to climate change by: removing policy and regulatory obstacles to adaptation; providing fiscal incentives to stimulate risk reduction; building technical adaptation capacities; using innovative mechanisms to reduce investment risk; and providing MSEs with adequate information on climate change impacts.

The report features recommendations for developing country governments, large private sector actors, multilateral and bilateral partners and special climate funds. For example, it suggests large private sector actors support MSEs in the supply chain by providing financial and technical assistance and by providing better access to adaptation finance. The report recommends multilateral and bilateral partners act as knowledge banks, facilitate the transfer of information about successful business practices and catalyze engagement in adaptation by ensuring market access for MSE products, among other actions. [UNDP Administrator Statement] [WRI Publication Website] [IISD RS Coverage of Launch Event] [IISD RS Coverage of COP 21] [Publication: Adapting from the Ground Up: Enabling Small Businesses in Developing Countries to Adapt to Climate Change]