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SME Financing for Biodiversity: Building Nature Measurement and Impacts into SME Financing (‘SME FinBio’)

Commissioned by the Natural Environment Research Council (NERC) and Finance for Biodiversity (F4B), this 6-months project starting in February 2022 will examine the UK SME finance markets in relation to how they risk assess the Climate and Biodiversity impacts of their SME finance customers and portfolios. In particular, the project will focus on the processes by which finance providers (debt, equity and insurance) can advise and encourage SME self-reporting to facilitate the improved operation of UK SME finance markets for a sustainable future.

The research will involve multiple stakeholder interviews (40-50) with SME finance providers and related support agencies, alongside the collection of secondary data, reporting and academic literature. The study also includes 10 case studies with SMEs across a range of urban and rural sectoral activities, purposively selected to gain greater insights into the SME demand-side issues with self-reporting. We have partnered with Shoremount, a consultancy with expertise in training SMEs for ‘B Corp’ certification, to assist with the selection of enterprise cases and analysis of what works for SMEs in respect of their Climate and Biodiversity self-reporting. Findings form the research will be tested in a series of stakeholder workshops held online during Summer 2022.

Additionally, a specific case study of the agri-food sector will be undertaken, involving further sector specific insights into the financing of SMEs in a high-risk Biodiversity sector. The case study will involve further Key informant interviews and enterprise case studies.

The project will report in the Autumn of 2022. It will provide practical policy guidance to the Task Force on Nature-Related Financial Disclosures (TNFD) to improve the reporting activities of SMEs. It will include practical policy briefing and finance market ‘how to’ guidance tools which will be tailored to assist UK SMEs, their access to finance support agencies and their investors and insurers.

For further information, please contact:
Dr Robyn Owen; r.owen@mdx.ac.uk
Dr Suman Lodh; s.lodh@mdx.ac.uk
Professor Fergus Lyon for agri-food case study; f.lyon@mdx.ac.uk

NERC Outputs

The Growing Role for Biodiversity and Nature Positive Impact Investing - Presentation to Seedtribe and 5-13 investor networks

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