Micro, small and medium enterprises (MSMEs) in Tamil Nadu and Gujarat are increasingly exposed to the effects of climate change, but many have yet to adopt structured plans to manage climate-related risks, according to findings presented at a stakeholder consultation held in Coimbatore.
The discussions highlighted that while businesses are experiencing the impact of rising temperatures, erratic rainfall, water shortages and other extreme weather events, preparedness remains limited. Experts noted that most MSMEs continue to focus on immediate operational challenges and have not integrated climate resilience into their long-term business strategies.
The consultation brought together representatives from industry, research institutions, government agencies and sustainability organisations to examine how climate risks are affecting industrial clusters. Participants observed that although awareness of climate change has improved over the years, the majority of small businesses still lack formal climate action plans, greenhouse gas accounting systems and adaptation measures.
Studies shared during the event revealed that several MSMEs have not assessed their exposure to climate-related disruptions or identified ways to reduce emissions and improve resource efficiency. Businesses also face challenges in accessing technical expertise, financial support and reliable information required to implement sustainability initiatives.
Industry experts stressed that climate change is no longer an environmental concern alone but has become a business risk that directly affects productivity, supply chains and operational costs. Heat stress, water scarcity, flooding and disruptions in power supply are already impacting manufacturing operations across industrial clusters, making climate preparedness an economic necessity.
Participants recommended that MSMEs begin by conducting climate risk assessments, monitoring energy and water consumption, improving resource efficiency and adopting cleaner technologies. They also encouraged businesses to develop clear mitigation and adaptation strategies that align with evolving environmental regulations and market expectations.
The consultation underscored the importance of collaboration between governments, industry bodies, financial institutions and research organisations to help MSMEs transition towards sustainable operations. Stakeholders called for targeted policy support, easier access to green financing, capacity-building programmes and practical guidance to enable smaller enterprises to adopt climate-resilient practices.
Experts also pointed out that large corporations are increasingly expecting their suppliers to meet environmental, social and governance (ESG) standards. As a result, MSMEs that fail to strengthen their climate preparedness may face challenges in maintaining their competitiveness in domestic and global markets.
Tamil Nadu has introduced several climate-focused initiatives through its Climate Change Mission, while industry associations are promoting sustainability practices among businesses. However, speakers noted that greater participation from MSMEs is essential to achieve meaningful progress.
The consultation concluded that climate action should become an integral part of business planning rather than a compliance exercise. By investing in energy efficiency, renewable energy, sustainable resource management and climate adaptation measures, MSMEs can reduce operational risks, improve resilience and create long-term value. Strengthening climate preparedness will not only help businesses withstand future environmental challenges but also enhance their competitiveness in an economy that is steadily moving towards sustainable and low-carbon growth.
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