The Future of SMES, Sustainability and the Pandemic

Norin Arshed, Victoria Chukwudum, Marta Anzillotti, Massimo Spinelli

Research output: Book/ReportCommissioned report


There is widespread agreement that adopting sustainable practices is critical for businesses, organisations, and society (Deng & Ji, 2015; Eccles, et al., 2014; Santos et al., 2013). While larger organisations have moved quickly in achieving sustainability goals, small to medium enterprises (SME) are falling significantly behind in implementing sustainability practices in their business activities (Mani et al., 2020; Nakamba et al., 2017). Although the advancement of large organisations in this regard is appreciable, nonetheless, society cannot fully benefit from sustainability unless SMEs implement sustainable practices, as these smaller firms account for many businesses globally (Chowdhury & Shumon, 2020). The engagement of SMEs in sustainability practices would not only contribute to global sustainability but these practices could enhance their competitive advantage (Moon et al., 2014). It has been established those sustainable organisations generally perform better than others that do not adequately maintain sustainable practices (Huq et al., 2014; Klassen & Vereecke, 2012;).

However, the adoption of sustainability practices by SMEs has suffered an unexpected setback because of the latest global pandemic – COVID-19 – which has significantly impacted businesses of all sizes (Ashford et al., 2020). It is a known fact that many SMEs have been dealing with policy challenges, environmental uncertainties, and business survival, particularly as a result of the impact of the COVID-19 crisis (Accountancy Europe, 2020). However, as always, crises bring with them circumstances that can translate to either opportunities or threats for entrepreneurship (Doern et al., 2019), depending on both the entrepreneurs and governments (Higgins-Desbiolles, 2020). Thus, the current pandemic can generate an opportunity for entrepreneurial activities, possible diversity of local economies (Greene & Rosiello, 2020), and support SMEs’ reorientation towards sustainability practices (Albaz et al., 2020; Barbagila et al., 2021).

This report provides an overview of SMEs’ sustainability practices during COVID-19 and the future of the agenda for all stakeholders involved. Based on a systematic literature review, we identify the challenges and opportunities of SMEs’ sustainability during COVID-19. We further outline the role of governments in implementing sustainability practices for SMEs, particularly in times of a crisis. By doing so, this study contributes to the literature on sustainability, as well as on SMEs. More importantly, the study’s recommendations for post-pandemic recovery can serve as a guide for SMEs and governments in formulating strategies to enhance sustainability within these smaller firms.

This report is structured as follows. First, we provide an understanding of sustainability as a concept. Second, we detail the methodological approach taken. Third, we discuss the dominant themes emanating from the review of relevant literature and finally we provide recommendations for policy and to inform future research directions.
Original languageEnglish
Place of PublicationLondon
Publisher89 Initiative
Number of pages40
Publication statusPublished - 2022


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