By most accounts, the story of Singapore has been a remarkable one. From humble beginnings without natural resources or industry, Singapore has transformed into a global economic powerhouse with a first-class education system, thriving industries, innovative infrastructure, and one of the highest home ownership rates in the world at about 89%. This remarkable journey of growth and resilience has been underpinned by strategic governance, an emphasis on innovation, and a commitment to improving the lives of Singaporeans.

With that said, like many other nations, Singapore now faces an existential challenge in an era marked by climate change and increasingly severe weather events. As a low-lying island-state, Singapore is particularly vulnerable to the threat of rising sea levels, making climate adaptation an urgent priority. The UN Sustainable Development Report 2024 highlighted this by identifying key areas where Singapore faces significant challenges in its progress toward some of the 17 Sustainable Development Goals (SDGs), particularly SDG 12 (Responsible Consumption and Production) and SDG 13 (Climate Action).

In response to these challenges, Singapore has implemented the Singapore Green Plan 2030, launched in February 2021. Known simply as the Green Plan, this comprehensive blueprint for sustainable development represents a coordinated, multi-ministry public sector effort, driven in partnership with the community and private sector. The Green Plan outlines clear targets across five pillars: City in Nature, Energy Reset, Sustainable Living, Green Economy, and Resilient Future. These pillars reaffirm Singapore’s commitment to achieving net-zero emissions by 2050, in line with the Paris Agreement, while enhancing food and water security, building climate resilience, and greening infrastructure and industry.

Achieving these ambitious goals requires participation across all sectors, but the key to net-zero largely lies in the hands of small and medium-sized enterprises (SMEs). This is both a matter of scale – SMEs make up 99% of Singapore’s enterprises and employ 72% of the workforce – and a matter of impact. SMEs have an extensive presence across Singapore’s business landscape, embedded in production lines, trade supply chains, business value chains, and enterprise networks. Their influence spans numerous sectors, and collectively, their actions can significantly drive or hinder the nation’s decarbonisation efforts.

However, embarking on the path to net-zero poses unique challenges for SMEs, many of whom may lack the resources or expertise that larger corporations have. The 2024 Singapore Business Federation (SBF) Bain & Company SME Decarbonisation Survey revealed that 60% of SMEs lack in-house capability for decarbonisation, and 46% are not even aware of potential solutions. As a result, only a third of SMEs have made significant progress in their decarbonisation efforts, in stark contrast to larger enterprises, where approximately 80% have advanced their sustainability agendas.

While barriers to decarbonisation exist, sustainable development and value creation can often go hand-in-hand. According to the 2024 SBF Bain SME Decarbonisation Survey, which surveyed approximately 500 Singapore SMEs, around half of those actively engaged in decarbonisation efforts have unlocked tangible economic benefits. These include market differentiation, which enables SMEs to increase their market share or command higher price premiums, as well as operational cost savings, eligibility for green grants and funding, and reduced regulatory compliance risks and costs.

One prominent example is the Gryphon Tea Company (Gryphon Tea), a Singapore-based tea manufacturer that has successfully incorporated environmental, social, and governance (ESG) goals into its core business strategy and operations. Gryphon Tea transitioned to FSC-certified paper for packaging, plastic-free and compostable tea bags, and has optimised its Heating, Ventilation, and Air Conditioning (HVAC) systems. These initiatives have not only led to cost savings of approximately 5% but also elevated Gryphon Tea’s sustainability credentials, helping it position itself as a brand of choice for eco-conscious consumers. Gryphon Tea’s story illustrates that sustainable practices can yield economic benefits and strengthen brand loyalty in increasingly eco-aware markets.

Another example is People Bee Hoon Factory, a rice vermicelli producer that has seen considerable economic returns through its commitment to sustainability. By installing solar panels on the rooftop of its facility, People Bee Hoon Factory now generates approximately 30% of its electricity needs from solar power, resulting in significant cost savings. Additionally, the reduction in carbon emissions – estimated at 138 tonnes annually – is equivalent to planting 189 trees, and underlines the environmental impact of their investment. Beyond electricity, the company has optimised its washing process, reducing water consumption by about 50% and further cutting waste and operational costs.

Recognising the challenges faced by SMEs in their decarbonisation journey, the Singapore government offers a wide range of grants and funding options to support sustainability efforts. These schemes are designed to assist SMEs at different stages of their sustainability journey, from those just starting out to innovation-driven enterprises with research and development (R&D) capabilities. Government-backed programmes offer much-needed financial support and resources, which are essential in helping SMEs develop and implement sustainable practices.

For example, Enterprise Singapore’s Energy Efficiency Grant incentivises SMEs in the food services, food manufacturing, and retail sectors to adopt energy-efficient equipment and processes. Qualifying SMEs can receive up to 70% funding support for adopting pre-approved, energy-efficient equipment, allowing them to reduce their carbon footprint and realise cost savings on capital and overhead expenditure. This grant provides SMEs with the immediate financial boost needed to adopt greener technologies, making the transition to sustainability more feasible.

SMEs with R&D capabilities can access additional support through initiatives such as the Closing the Resource Loop (CTRL) Funding Initiative by the National Environment Agency (NEA). This programme funds research and development on sustainable resource recovery solutions, addressing key waste streams like e-waste, plastic waste, and food waste. Such R&D efforts are pivotal to achieving a circular economy, a core component of Singapore’s Zero Waste Masterplan, which seeks to transform waste into valuable resources and close resource loops.

In the financial sector, the Monetary Authority of Singapore (MAS) has introduced the Green and Sustainability-Linked Loan Grant Scheme (GSLS), the first of its kind globally. This scheme aims to make green financing more accessible for SMEs by subsidising the cost of engaging independent service providers to verify the green credentials of sustainability-linked loans. By facilitating access to green loans, this initiative encourages SMEs to adopt sustainable practices without the financial strain that might otherwise deter them.

In addition to these options, several other schemes offer funding and financing to help businesses enhance resource and energy efficiency. Examples include the Water Efficiency Fund by the Public Utilities Board (PUB), which supports water-saving initiatives, and the Building Retrofit Energy Efficiency Financing (BREEF) scheme, facilitated by the Building and Construction Authority (BCA) and participating financial institutions, which provides financing for energy-efficient building retrofits.

To further build sustainability capabilities, Enterprise Singapore launched the Enterprise Sustainability Programme (ESP) in 2021 with a $180 million investment. The ESP offers sustainability-focused training and supports capability-building projects. It also fosters collaborations with trade associations, chambers, and corporates to drive sector-specific sustainability initiatives. Through the ESP, SMEs can gain the knowledge and skills needed to integrate sustainability into their core business strategies, creating a sustainability ecosystem that spans training, certification, and financing.

Furthermore, to bridge the gaps in awareness, capability, and financing among SMEs, Bain & Company, SBF, and Enterprise Singapore have partnered to launch the Sectoral Net Zero Transition Programme. This programme offers a digital tool powered by generative AI, which enables SMEs to develop decarbonisation plans with minimal expertise or effort. The programme also includes expert-led workshops that offer structured, sector-specific training to address the unique needs and challenges faced by different sectors. By providing SMEs with resources tailored to their specific circumstances, the programme aims to accelerate their journey toward net-zero.

Several SMEs in Singapore have emerged as champions of energy efficiency and decarbonisation, demonstrating that sustainable practices can be integrated into existing business operations without compromising profitability. For instance, Onn Wah Precision Engineering, established in 1961, exemplifies how traditional companies can adapt to modern sustainability standards. Despite being in a high-energy industry that requires climate-controlled facilities, Onn Wah has committed to decarbonisation and received the Outstanding SME award at the Energy Efficiency National Partnership (EENP) Awards 2023. Working with the Energy Efficiency Technology Centre (EETC), Onn Wah installed a 263kWp solar panel system and heat-rejection solar films, achieving an annual energy saving of 76,062 kWh. By implementing small changes, such as fixing air leaks and switching to LED lights, the company saved additional energy and demonstrated that even minor adjustments can yield significant results.

Another recipient of the Outstanding SME award at the EENP Awards 2023, PLC Industries has made strides in energy efficiency by integrating it into both operations and company culture. PLC’s partnership with the EETC enabled them to conduct an energy profile assessment, which identified opportunities to reduce consumption. Installing 234 solar panels allowed PLC to generate energy savings of 117,510 kWh, reducing carbon dioxide emissions by 476.7tCO2e (tonnes of carbon dioxide equivalent). The company has also adopted Schneider Electric’s Decarbonisation Programme, with the ambitious goal of reducing electrical consumption by 40% by 2030. This commitment reflects PLC’s determination to lead by example in the transition to a low-carbon economy.

In alignment with Singapore’s Zero Waste Masterplan, other SMEs are driving innovation in waste management and recycling. These enterprises embody the creative thinking and technological advancement needed to increase the national recycling rate to 70% and reduce waste-to-landfill per capita per day by 30% by the year 2030. Through their efforts, they are making valuable contributions to both resource recovery and waste reduction – vital components of the circular economy.

Biomax Green Pte Ltd, a biotechnology company in Singapore, developed a Rapid Thermophilic Digestion System that transforms organic waste into 100% pure organic fertiliser within just 24 hours. This innovative solution not only addresses waste disposal challenges faced by various industries, but also contributes to the circular economy by turning waste into a resource – benefiting both the environment and businesses seeking sustainable practices.

Meanwhile, N&E Innovations, a MedTech company headquartered in Singapore, developed Vikang99, the world’s first antimicrobial agent derived from upcycled food waste. Certified to eliminate viruses, including coronaviruses, it is engineered with 100% natural antimicrobial compounds that are non-toxic. This breakthrough not only addresses the growing need for effective antimicrobial agents, but also tackles food waste, which remains a significant environmental challenge. In recognition of its efforts, N&E Innovations was awarded the Hinrich Foundation SME Sustainable Trade Award Singapore 2023.

Making waves on the international stage, Seven Clean Seas, a waste management and environmental restoration company, has removed over 4 million kg of plastic from the ocean through projects in Thailand and Indonesia. Their innovative plastic credits system enables businesses to achieve plastic neutrality by funding ocean-bound plastic removal, providing a unique solution to tackle plastic waste. These efforts earned Seven Clean Seas an Impact Enterprise Excellence Award in the SME category at the Sustainability Impact Awards 2024, organised by The Business Times and United Overseas Bank (UOB).

SMEs in Singapore have demonstrated that sustainability is not just an ideal, but a practical business approach that can lead to growth, resilience, and innovation. By integrating sustainability as a core part of their vision, strategy, and mission, these SMEs are enhancing their brand image, improving economic viability, and boosting operational efficiency. Their efforts contribute Singapore’s sustainable development goals, and the well-being of the planet we all share.

Together, the combined efforts of the public and private sectors can pave the way toward a greener, more resilient future for Singapore and the world.