Robyn Owen, Co-Chair ISBE Entrepreneurial Finance Special Interest Group
Professor Javed Hussain from Birmingham City University hosted a groundbreaking conference examining financing of green innovative SMEs from the regional perspective, showcasing Birmingham City and the West Midlands region. Over 60 policymakers, practitioners, enterprises and academics attended, including presentations by Birmingham City Council, Midlands Energy Hub, Lombard Commercial and Private Banking, Footsteps – Faiths for a Low Carbon Future and leading SME finance researchers from England (Professors Marc Cowling and Robyn Owen), Professor Mark Gilman, Birmingham City University, Ireland (Professor Ciaran Mac an Bhaird) and Scotland (Dr Ian Cairns). We are grateful for support from the Institute for Small Business and Entrepreneurship (ISBE) and ESRC Centre for Understanding Sustainable Prosperity (CUSP).
The conference highlighted the need to support SME innovation to tackle climate emergency. Birmingham is one of the first UK cities to declare a City Centre clean air zone by 2020. Delivering such a rapid transition has massive repercussions for SMEs and requires not only financial support, but also a comprehensive planning strategy to enable change. The conference presentations and debate sought to address this from an SME financing perspective, with several key themes emerging:
- SMEs are a vital and dynamic part of the regional economy and can be a major force for climate change, but this will only work if policies provide a just transition that engages them and addresses their lack of resources.
- Local and regional finance, whilst possessing local knowledge and connections, is often small-scale and insufficiently structured to supply the needs of key SMEs, including early stage innovators that could provide key climate change solutions.
- Green enterprise cleantech definitions and performance metrics remain sketchy. The market is evolving fast and it is evident that policy has to examine more closely the circular economy value of investments.
- The relationships between energy efficiency (production and use), transport and climate impacts need to be carefully balanced in climate change strategies.
- Green New Deals which provide overarching strategies and properly cost externalities could demonstrate justification for public spending and need for more cohesive policy approaches which will seek to balance regional inequalities with national resources.
- Financial and professional intermediaries, including academic researchers have a key role to play in enhancing cross border, local, regional, national and international policy and service linkages to support an effective green finance ecosystem for SME green innovation.
In summary, to achieve the rapid transition required, clear strategic policy needs to be in place at local, regional and national levels – alongside international engagement – that addresses the considerable financing and support needs of green SMEs and prioritises the financing of green circular economy businesses and greening of all SMEs, marking a major shift from the current market-led, for profit Anthropocene disaster paradigm.
Since its launch in January 2017, ISBE’s Entrepreneurial Finance SIG has gone from strength to strength, hosting significant, well-attended events for its members and wider network, and building an impressive list of journal outputs. A recent special issue of the International Journal of Entrepreneurship and Innovationhas been produced under the auspices of the SIG, edited by SIG Chairs, Robyn Owen and Ciarán Mac an Bhaird and Mark Freel. The journal can be accessed here: https://journals.sagepub.com/toc/ieia/current
This is the second journal special issue produced under the auspices of the SIG in 8 months (a special issue of the journal Strategic Change was produced in February).