Summary
Micro, small and medium enterprises (MSMEs) in emerging and developing economies (EMDEs) are aware of climate risks and are taking adaptation action. With the adaptation finance gap in developing economies estimated at up to $339 billion per year, and private sector reporting on adaptation still largely absent, this report makes the case for better data, smarter financing instruments, and a renewed focus on the firms that stand to lose — and gain — the most from climate investments.
Why is this data especially important to MSMEs in EMDEs?
Smaller firms face higher exposure to asset damage, rising adaptation costs, and longer recovery periods after climate shocks. Yet despite shouldering disproportionate climate costs, limited insights exist on firm-level adaptation to date, due to challenges in measuring adaptation and limited visibility of private sector action. This report changes that. Drawing on data from over 20,000 firms across 46 developing countries through the World Bank Enterprise Survey, it offers the most comprehensive firm-level analysis to date of how MSMEs in emerging market and developing economies are adapting to climate change — and what is holding them back.
How can we address the data gap?
This report introduces a detailed adaptation finance typology tailored to MSMEs and offers actionable insights for investors, financial institutions, policymakers, and development organizations working to close the gap.
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