The Role of Government Support in SMEs’ Adoption of Sustainability

In the existing literature on small and medium-sized enterprises' (SMEs') sustainability adoption, research focused on the US has been limited compared to Europe. Investigating the role of government as a major driver and/or barrier to SMEs' engagement in sustainable practices, our study uncovers findings from interviews with 75 NY State SMEs, representing a broad cross section of industries and geographical spreads across communities of various sizes. The most common sustainable solutions implemented included recycling/waste reduction, use of renewable/efficient energy, adoption of reusable materials, sourcing from local suppliers/supporting local economy, and utilizing third-party sustainability audits or achieving sustainability-related accreditations. While municipalities, states, and federal government offer incentives and impose regulations to motivate and shape SMEs' adoption of sustainable strategies, our results indicate limited impact of such interventions. Although SMEs are adopting sustainable solutions and believe that their efforts are paying off, they also indicate that lack of guidance from government has prevented them from improving the scope of their sustainability programs. Promotion of sustainable practices by SMEs in the US, we believe, needs more deliberate and focused strategies. As self-motivated, passionate and driven as many of the owners/managers we interviewed are in adopting sustainable practices, public agencies should play a leading role in informing SME practitioners on the incentives available and how to access them as well as other types of targeted educational and consulting services. Industry associations could also help by offering similar informational and training programs.