Dun & Bradstreet India announced the launch of Sustainability Perception Index in collaboration with Small Industries Development Bank of India

2024-04-22 12:29:38 Business

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Mumbai, March 09, 2023: Corporate sustainability has become a mainstream business concept and not just an ethical consideration. An increasing number of MSMEs in India are getting on board as they recognize the value of sustainability, and are starting to look beyond commercial criteria to develop priorities and strategies. Businesses are transitioning from incremental improvements to bolder, systemic initiatives that have a net positive impact. There is no doubt among business leaders that sustainability ought to be on the agenda, and MSMEs are no exception.

Dun and Bradstreet India, in collaboration with Small Industries Development Bank of India (SIDBI), has introduced a quarterly Sustainability Perception Index (SIDBI - D&B SPeX). It is India?s first in-depth, quantitative look at the actions MSMEs are taking to implement sustainability principles and advance sustainable development goals. The index assesses the internal and external factors that shape the sustainability perception of businesses across three dimensions ? willingness, awareness, and implementation. The survey results show a high level of willingness among senior executives. In terms of awareness and implementation, the survey shows that there are distinct areas where Indian MSMEs are excelling and others where they lag. This first survey serves as an important benchmark for measuring MSMEs' actions in the future.

Speaking about the importance of sustainability goals, Avinash Gupta, Managing Director and CEO ? India, Dun & Bradstreet said, ?SPeX at 46 indicates that the perception of MSMEs towards sustainability is in the low to middle range. MSMEs believe that raising awareness is necessary to increase adoption of sustainability measures, and that these would benefit the bottom line (23%), staff retention (21%), and social lives and communities (20%). The greatest enabler of sustainability adoption is cost reduction, followed by internal management drive and government policies and regulations. The most difficult issues are technical expertise and established operational processes.?

Shri Sivasubramanian?Ramann,?Chairman and Managing Director of?SIDBI?stated, ?Understanding and awareness about ESG are gaining momentum amongst MSMEs and it is relevant in view of changing scenarios related to climate aspects. The survey report for Q3 2022-23 is a baseline exercise for measuring sustainability adoption among Indian MSMEs. The research delves into some of the significant difficulties and opportunities that MSME face when developing sustainability strategies. Future research will follow changes in MSMEs' perspectives and behaviour towards the adoption of sustainable business practices. This report will also enable stakeholders to align strategies for enhancing preparedness of MSMEs in pursuit of India?s carbon neutrality commitments.?
Highlights of the SPeX Report:

The Sustainability Perception Index (SpeX) for Oct-Dec, 2022 stands at 46, indicating a low level of perception towards sustainability by MSMEs of India.

Amongst the three stages of sustainability (willingness, awareness, and implementation) the sub-index for willingness is highest at 61, suggesting that MSMEs are willing to adopt sustainability measures

Implementation and awareness is low, with sub-index values of 41 and 40, respectively.

Most respondents cited the need for creating awareness as a step to improve sustainability adoption

Nearly 44% consider sustainability measures to be a useful guideline towards responsible governance, while another 19% consider it to be a requirement for working with global businesses

Awareness of sustainability measures is low amongst MSMEs as only 69% are partially aware of the opportunities from implementing sustainability measures and relevant sustainability factors for their business, sector, and geography
MSMEs believe that sustainability initiatives would have a positive impact on the bottom line (23%), impact on employee retention (21%) and positive outcomes on social lives and communities (20%)

50% of MSMEs chose ?ethics and integrity? as a sustainable priority, while only 20% chose ?diversity and inclusion? as their sustainable priority

78% of MSMEs consider sustainability initiatives to be closely linked to business strategies and only 22% consider them to be distinct and loosely linked

MSMEs prioritize economic objectives, followed by social and environmental goals while implementing sustainability measures

Cost reduction is the highest enabler for sustainability implementation (35%), closely followed by internal management drive (34%) and government policies & regulations (33%)

Technical know-how (23%) and established operating procedures (22%) are the biggest challenges

52% of MSMEs are unaware of green finance policies. While 35% are partially aware of them, only 3% have availed green finance

About Dun & Bradstreet:

Dun & Bradstreet, a leading global provider of business decisioning data and analytics, enables companies around the world to improve their business performance. Dun & Bradstreet?s Data Cloud fuels solutions and delivers insights that empower customers to accelerate revenue, lower cost, mitigate risk and transform their businesses. Since 1841, companies of every size have relied on Dun & Bradstreet to help them manage risk and reveal opportunity. For more information on Dun & Bradstreet, please visit www.dnb.com.
Dun & Bradstreet Information Services India Private Limited is headquartered in Mumbai and provides clients with data-driven products and technology-driven platforms to help them take faster and more accurate decisions across finance, risk, compliance, information technology and marketing. Working towards Government of India?s vision of creating an AatmaNirbhar Bharat (Self-Reliant India) by supporting the Make in India initiative, Dun & Bradstreet India has a special focus on helping entrepreneurs enhance their visibility, increase their credibility, expand access to global markets, and identify potential customers & suppliers, while managing risk and opportunity.

About SIDBI:

Small Industries Development Bank of India (SIDBI) in its role as the Principal Development Finance Institution for MSME sector has played a significant role in developing the financial services for MSME sector through various interventions including Refinance to Banks, Credit Guarantee programs, Development of the MFI sector, Contribution to Venture capital/AIF funds, MSME ratings, promoting digital lending ecosystem, etc. The Bank has proactively been working toward Energy Efficiency (EE) in MSMEs since 2005-06 as part of Direct Finance business using support of multilaterals like World Bank, ADB, GiZ, FCDO, JICA, AFD, KfW etc for energy efficient projects. SIDBI has taken steps to promote Energy Efficiency and Cleaner production in the MSME sector and propose to accelerate its efforts for MSME sector for their survival, growth and competitiveness in long run during prevailing climate related challenges.

Looking to importance of ESG aspects and the need for a simplified, customised ESG risk rating framework, SIDBI has already started integration of ESG framework into its operations. Subsequent to setting up of Green Climate Finance Vertical for prioritised focus, a Board level Committee has been constituted for guidance, oversight and monitoring on ESG, Green Strategy of the bank, including relevant SDGs etc. To lead with the example, SIDBI has set a target to become Carbon Neutral by 2024 and Net Neutral organization in subsequent years.

Through Green Financing products and other developmental activities, SIDBI enables the manufacturers and service providers in MSME sector to adopt green energy efficient technologies helping in lesser waste leading to positive impact on environment and sustainability.