Turning the tables: How SMEs can shape the future of food sector decarbonization
Pamela Jouven, Director, SME Climate Hub
The global food system is responsible for up to 37% of global emissions annually. And while farming may be the most visible part of the system, emissions also stem from land use, processing, distribution, packaging, refrigeration, retail, and waste.
In sectors like food and beverage manufacturing, small and medium sized enterprises (SMEs) are critical connectors, particularly in midstream segments where processing, distribution, and logistics occur.
Mobilizing and supporting these SMEs to cut their emissions is essential for larger companies to deliver on their own emissions reduction targets. Meanwhile, taking climate action helps small businesses build resilience amid shifting policy regulations, consumer demands, and global market pressures.
The SME Climate Hub is an initiative of the We Mean Business Coalition, co-founded and operated in partnership with the Exponential Roadmap Initiative and the UN Climate Change High Level Champion’s Race to Zero campaign, that offers SMEs free tools for decarbonization. As of 2025, nearly 10,000 SMEs have committed to net-zero through the SME Climate Hub, spanning 28 sectors of the economy, and thousands more are using the Hub’s tools and resources.
To support food and beverage SMEs, including the 226 that have already made the SME Climate Commitment, the Hub has launched new free climate action tools funded in part by a grant from Walmart and in collaboration with organizations such as Climate Collaborative, a member of the course development Steering Committee. These include a sector action checklist to track Scope 1, 2, and 3 emissions, plus two action courses focussed on two priority areas: one on tackling logistics holistically, and another on reducing and transitioning energy use. These are exactly the resources SMEs are asking for: 41% of SMEs told the Hub earlier this year in a survey that to take greater climate action, they need industry-specific guidance or solutions.
Talking about how the Hub’s tools can facilitate action, Hugh Anderson, Founder of Downton Distillery and SME Climate Hub member said: “Accessing tools for emissions reporting can be very expensive, but the SME Climate Hub provided a tool and reporting structure that allowed us to keep track of our emissions, without over complicating the process.”
Priority levers for decarbonization
According to a 2022 study, global food-miles account for nearly 20% of total food-systems emissions, making freight and transport electrification a low hanging fruit for sector decarbonization. Quick wins for SMEs taking action on logistics include lower fuel costs from optimized routes, efficient refrigeration with less energy consumption and reduced spoilage meaning fewer produce losses. When it comes to logistics, lowering emissions often goes hand in hand with lowering costs.
SME Climate Hub signatory Suma Wholefoods is one such company working hard to cut its transport emissions. Their 2024 Sustainability Impact Report shows they have cut fuel use by nearly 50,000 litres thanks to the operation of regional driving hubs, route planning and vehicle optimisation, driver training to reduce driver idling times and their use of two biogas trucks which emit 84% fewer emissions than their diesel equivalent.
On the energy side, electrification is an especially powerful lever. A McKinsey analysis estimates that by 2030, around 44% of the food and beverage sector’s energy demand could be easily electrified, thanks to the prevalence of low- to medium-temperature processes (e.g., baking, drying, pasteurization) that suit electric technologies like heat pumps and electric boilers.
SME Climate Hub signatory, Toast Ale’s 2024 Impact Report calls on the UK government to make good on its pledge to decarbonize the energy mix by 2030 so that small scale brewers can decarbonize production. But in the meantime, it has found novel ways to lower its carbon emissions. Since Toast Ale began brewing in 2016, it has turned 3.9 million slices of surplus bread into beer, avoiding emissions of 7.5 tCO2e.
To help SMEs replicate successes like Suma Wholefoods and Toast Ale, they can access the SME Climate Hub’s free tools to track emissions and action courses on logistics and energy and can get practical guidance on how to accelerate sector-wide progress.
The bigger picture
Small and medium-sized enterprises (SMEs) make up around 90% of businesses and more than 50% of employment worldwide. Globally, SMEs are major employers, providing 7 out of 10 jobs in emerging markets. In the EU alone, of the 216 million people in employment, 85 million of them, or 39%, work at an SME. As major employers, often operating with smaller teams and on a more agile basis than big businesses, SMEs need accessible and practical resources to support their climate efforts.
In the UK 77% of SMEs consider themselves to be at least in one supply chain relationship. While in the US, companies with fewer than 500 employees make up 98% of supply chain firms.
For large businesses, resilient supply chains – ones that have the capacity to adapt and recover quickly when faced with disruptions – are essential to a company’s overall competitiveness. However, just 1 in 4 disclosing companies that reported through CDP in 2023 are factoring supply chain climate-related risks into their risk management processes.
To increase the speed and scale of supply chain action, together with partners we have distilled common questions and valuable insights into a resource aimed at providing practical approaches and examples. Read our seven tips for big businesses that offer adaptable strategies and best practices.
Looking at a real-world example. In 2024, beverage manufacturing giant Heineken lowered its Scope 3 emissions by 14% against a 2022 baseline. And the firm is cascading its supply chain decarbonization too through the Supplier Leadership on Climate Transition (‘Supplier LOCT’) initiative with 56 of its suppliers establishing science-based targets, with an additional 18 suppliers joining the program in 2024. Added to this, the company launched the REfresh Alliance with 10 beverage companies to support suppliers in accelerating the adoption of renewable electricity.
Since SMEs form the backbone of supply chains as suppliers, their ability to decarbonize directly shapes the pace and credibility of larger companies’ own decarbonization efforts. For big businesses aiming to meet Scope 3 targets, in the food and beverage sector and beyond, supporting SME action is not optional, it’s a prerequisite for building resilient, low-carbon supply chains.
Two sides of the same coin
Effective decarbonization requires climate action at all levels. For large companies, that means embedding supplier engagement and supply chain resilience into strategy; for SMEs, it means seizing the accessible, cost-saving opportunities like those highlighted by the SME Climate Hub. By moving together, SMEs with their agility and reach, and large corporations with their scale and influence, the food and beverage sector can cut emissions faster, strengthen resilience, and create a more sustainable and competitive industry for the future.
With special thanks to Climate Collaborative for their input on this piece.
Get started with the SME Climate Hub tools today, or for big businesses discover our supplier engagement resources.