Navigating climate change: Climate change awareness and strategies in micro, small, and medium-sized enterprises in a developing economy

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 3 / 26 MSMEs aware of CC and decarbonization? (b) How do MSMEs develop strategies to address CC and achieve carbon neutrality? (c) What factors shape MSMEs’ attention to CC and decarbonization? To explore these questions, we analyzed the awareness and strategic approaches of 1,453 ventures in Colombia—a developing economy in the Global South— specifically focusing on their awareness of CC and carbon neutrality. Our results indicate a significant heterogeneity in awareness levels influenced by economic sectors. This variation in awareness shapes the strategic actions in response to CC-related pressures. Notably, while many MSMEs in our sample exhibited limited awareness of CC, most acknowl- edged an internal impact of CC on their operations, recognizing its direct effects on their business activities and outcomes. Furthermore, our findings suggest that MSMEs displayed greater awareness of strategies at the corporate practice level compared to those targeting operational processes. By analyzing and comparing MSMEs from different economic sectors, we gain granularity in understanding their commonalities and differences across a wide range of CC-related variables and dimensions. Based on this, we propose new avenues for research with implications for scholars, policymakers, and practitioners. This article is structured as follows. First, section 2 presents the theoretical framework, providing a comprehensive liter-

ature review on the emergent topic of CC among MSMEs. Next, section 3 describes the material and methods. Afterward, section 4 presents the analysis of MSMEs’ perceptions, awareness, and CC strategies. Next, section 5 elaborates on the main implications of our findings. Finally, section 6 addresses the main limitations and concluding remarks. Literature review Climate change awareness and strategies in MSMEs The literature linking MSMEs’ awareness and strategies toward CC is still in its infancy. Two primary streams have emerged to explore this phenomenon. The first stream investigates the determinants influencing organizational response to climate-related challenges [22,26,29,30,32–35]. Within this stream, Mungai, Ndiritu, and Rajwani (2023) [34] explored the drivers of environmentally driven policies and practices, finding that organizations that undergo an audit process and engage in internal awareness initiatives—such as compensation policies linked to environmental impact—experience improved environmental performance in terms of energy consumption and savings. In turn, Cai et al. (2022) [35] exam- ine how external pressures foster awareness about climate change (CC). In short, they found that factors such as media influence and local corporate social responsibility initiatives significantly correlate with low-carbon behaviors among entrepreneurial ventures, thus, suggesting that external pressures can drive a shift toward sustainable practices. Similarly,

Lo, Liu, and Cheung (2019) [33] explored how the attributes and capabilities of key corporate decision-makers shape awareness of CC risks. Overall, they find that executives operating in disadvantaged contexts—characterized by limited human and social capital—are more likely to recognize the vulnerability of their firms to extreme weather events. Likewise, Chowdhury, Maiti, and Bhattacharyya (2016) [32] explored CC awareness at the community level, noting that bridging the gap between scientific knowledge and practical application demands the development of multidimensional educational programs tailored to diverse target audiences. Importantly, Afolabi et al. (2023) [26] explored sustainable behavior among MSMEs, noting that their organizational objectives are often disconnected from greenhouse gas reduction goals. This misalignment is attributed to unclear sustainability targets, knowledge gaps about CC, a lack of perceived benefits from addressing environmental concerns, and limited information on sustainability reporting and best practices. Finally, Fuchs, Mohan, and Strob (2023) [29] investigated awareness patterns among Swiss MSMEs, finding that firms with limited human capital exhibit lower CC awareness than larger corporations. Ultimately, their findings reinforce that awareness is closely tied to the environmental knowledge resources within each firm. The second research stream delves into the determinants of CC strategies [25,27,28,36–39]. For instance, Dale et al.

(2022) [27] proposed that MSMEs’ strategic choices are heavily influenced by their capacity to adapt by selecting suit- able management tools to address immediate and long-term environmental risks. Similarly, Luederitz et al. (2021) [28]