Addressing Climate Change Together: A Systems Thinking and Stakeholder Focused Intervention Perspective to Engaging SMEs on Carbon Emissions Reduction and Net Zero Schemes

The imperative of carbon emission reduction and the pursuit of Net Zero initiatives are increasingly recognized as pivotal in addressing the global climate crisis. Specific to businesses, adopting Net Zero initiatives ties-in with their social and environmental responsibility obligation. The idea of Social/Environmental Responsibility, and related concepts such as Environmental and Social Governance (ESG), is that businesses have a responsibility for the impact of their activities on society (i.e., stakeholders), and that this (i.e., impact) on stakeholders should be positive. ‘Positive impact’ has at least two main dimensions. First, the business’s activities are expected to have a positive impact on at least one of the triple bottom lines (environment, social and economic development). Secondly, it needs to ensure an appropriate provision is made for managing the potential negative impacts that (may) arise from business activity. The positive impact logic should apply to all businesses. However, the small business (i.e., SME) social responsibility context for Net Zero initiatives is not a common starting point for policy-makers and researchers. Correspondingly, understanding how Net Zero initiatives can be approached by this business category makes sense, not least because small firms are an important part of the economic and social landscape, consistently comprising more than 95% of private businesses around the globe. This chapter explores the crucial role of engaging diverse stakeholders in this endeavour, underscoring the need for inclusive, cooperative efforts to assist small businesses in transitioning to a low-carbon, sustainable future. Specifically, it examines the theoretical underpinnings and practical applications of stakeholder theory and system theory in environmental sustainability, focusing on carbon emission reduction and Net Zero initiatives that are relevant to the SME context.