Redefining SME productivity measurement and assessment for a low carbon economy

The UK faces dual policy requirements for improved business productivity and progression to a low carbon economy to achieve Net Zero by 2050 or earlier. Investment in innovative, early stage Cleantech firms will play an important role in meeting the low carbon targets, but high costs, risks and long time horizons make financing problematic. Whilst a great deal of government intervention has been directed at necessary large-scale green infrastructure schemes, there has been relatively less attention on creating an effective financing system for early stage, innovate Cleantech SMEs. Furthermore, traditional productivity measures rarely account for the wider impacts of low carbon innovation investment in these early stage SMEs.

Alongside partners from the Centre for Enterprise and Economic Development Research (CEEDR) at Middlesex University, the Centre for Understanding Sustainable Prosperity (CUSP), St John's Innovation Centre and the UK Green Angel Syndicate, SQW is currently working on a study for the ESRC-funded UK Productivity Insights Network (PIN) exploring how productivity measures could be redefined for Cleantech SMEs to reflect environmental outcomes and stimulate more low carbon impact investing. This research is multi-disciplinary, combining expertise in policy evaluation, productivity, entrepreneurial and behavioural finance, and low carbon innovation. The project will explore the metrics and indicators used by investors and SMEs trying to value the environmental, social and economic contribution of their investments, and identify areas for improvement in policy and practice to encourage low carbon investment. We are also interested in how 'standard' productivity measures can be adjusted to take into consideration wider sustainability requirements necessary to achieve a low carbon environment.

We welcome feedback and collaboration from key policymakers, cleantech market experts and support providers, impact investors and investment groups. If you would like to contribute to this research, please get in touch with Rebecca Pates at