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 1 / 26 OPEN ACCESS Citation: Díaz Tautiva JA, Barros-Celume S, Lecuna A, Barragan-Rodriguez C (2025) Navigating climate change: Climate change awareness and strategies in micro, small, and medium-sized enterprises in a developing economy. PLoS One 20(7): e0327165. https:// doi.org/10.1371/journal.pone.0327165 Editor: Tianheng Shu, Tsinghua University, CHINA Received: November 20, 2024 Accepted: June 10, 2025 Published: July 2, 2025 Copyright: © 2025 Díaz Tautiva et al . This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Data availability statement: The minimal anonymized dataset necessary to replicate the analysis is available in the following reposito- ry: (https://osf.io/fnymj/) with assigned DOI https://doi.org/10.17605/OSF.IO/FNYMJ. RESEARCH ARTICLE Navigating climate change: Climate change awareness and strategies in micro, small, and medium-sized enterprises in a developing economy Julián Andrés Díaz Tautiva 1,2☯, Sebastian Barros-Celume 3☯*, Antonio Lecuna4‡, Camila Barragan-Rodriguez5‡ 1 Centro de Gestión y Economía Aplicada, Departamento de Ciencias Económicas y Administrativas, Facultad de Ciencias Jurídicas, Económicas y Administrativas, Universidad Católica de Temuco, Temuco, La Araucania, Chile, 2 SK Research, Oxford Business College, Oxford, United Kingdom,

3 Facultad de Ciencias Económicas y Administrativas, Universidad Católica de la Santísima Concepción, Concepción, Biobío, Chile, 4 Katz School of Business, Fort Lewis College, Durango, Colorado, United States of America, 5 Facultad de Economía y Negocios, Universidad Del Desarrollo, Santiago, Región Metropolitana, Chile ☯ These authors contributed equally to this work. ‡ AL and CBR also contributed equally to this work. * sbarros@ucsc.cl Abstract Given the limited research on climate change (CC) awareness and strategies among micro, small, and medium-sized enterprises (MSMEs), this study aims to address three key questions: To what extent are MSMEs aware of CC and decarbonization? How do MSMEs strategize to address CC and achieve carbon neutrality? What factors shape MSMEs’ attention to CC and decarbonization? Drawing on theoretical insights from the Attention-Based View, we analyze CC awareness and strategies among 1,453 Colombian ventures to identify common patterns and traits between them. Our findings reveal a significant gap in MSMEs’ understanding of essential concepts such as carbon neutrality, decarbonization, and the overall impacts of CC on their businesses. Moreover, the results indicate that most MSMEs exhibit greater awareness of CC-related strategies at the corporate practice level than those aimed at operational processes. On average, respondents estimate that achieving carbon- neutral emissions will take between five to twenty years. Based on our findings, we propose scholarly, managerial, and policy recommendations to enhance CC aware-

ness and promote effective CC-related strategies across MSMEs from different economic sectors.

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 2 / 26 Introduction Among industrialized economies, around 95 percent of organizations are categorized as Micro, Small, and Medium-Sized Enterprises (MSMEs) [1]. MSMEs are key to economic growth and development, producing more than 50 percent of the total value added and 60 percent of private sector jobs [2]. However, on a global scale, MSMEs contribute significantly to environmental degradation, accounting for approximately 50–60 percent of total carbon emissions worldwide [1,3,4]. Therefore, they highly contribute to the increasing effects of climate change (CC), which is understood as massive large discontinuous changes resulting in alterations in the global average tem- perature, affecting the capacity of natural ecosystems, generating disruptions in precip- itation patterns, and increasing the occurrence of extreme weather events [2,5–7]. As a result, CC introduces uncertainty regarding the availability of production factors (e.g., energy, raw materials, and human capital), and disruptions in the business environment itself, which may impact organizational growth and survival [8–13]. Despite the crucial role of MSMEs in the rising effects of climate change, most research on organizational strategies related to climate change has focused on large corporations. Existing literature has extensively explored how large firms adapt their business operations [14] in response to increasing scrutiny from various stakeholders [15]. Extant research has also examined the organizational determinants of environ-

mental strategies under uncertain conditions [16], the growing trend of disclosure among large firms to comply with evolving standards and regulations [17,18], and their cooperative and innovation-driven initiatives to mitigate environmental impacts and externalities [19]. Additionally, the literature has analyzed how contextual fac- tors—such as normative, market, and social pressures—shape corporate environ- mental behavior, long-term investments, mitigation efforts, and economic outcomes [20–22]. Moreover, previous research has examined how some industries have shifted their processes, adopting cleaner production inputs [23,24]. Nonetheless, little empirical attention thus far has focused on how MSMEs per- ceive and strategize toward CC [25,26]. This gap may be partially explained by the weaker law enforcement regarding MSMEs’ environmental behavior compared to larger organizations, thus limiting available information for large empirical studies among MSMEs. This issue becomes increasingly prominent in developing markets [4,27], where environmental regulations targeting MSMEs are fewer and where official data among MSMEs is even scarcer and harder to find. As a result, research on MSMEs’ environmental practices remains inconclusive, inconsistent, and dis- jointed [3]. To face this concern, a body of literature has emerged in the last couple of years to understand the actions and decisions through which MSMEs develop a sustainability orientation [28,29] and their attitudes and strategic responses toward

CC [30,31]. Overall, there is an increasing interest in understanding how MSMEs perceive CC and how public policies could help MSMEs address this grand global challenge [32]. Following the call toward guiding MSMEs’ actions towards a greener economy [26], this research aims to answer three interrelated questions: (a) To what extent are Funding: The author(s) received no specific funding for this work. Competing interests: The authors have declared that no competing interests exist.

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]

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 4 / 26 highlighted that MSMEs develop sustainability strategies based on perceived value creation across environmental, social, and economic domains, often shaped through multi-stakeholder dialogues and influenced by the experiences and per- ceptions of organizational members. In turn, Sáez-Martínez, Díaz-García, and González-Moreno (2016) [37] found that external pressures, such as market demands and regulatory requirements, trigger sustainability strategies across firms. Henriques and Catarino (2016) [36] found that energy-related decisions depend on firm-specific characteristics, such as information accessibility and cognitive resources. Lastly, Nejati, Amran, and Ahmad (2014) [25] suggested that firms expe- riencing pressures from employees and customers tend to adopt more proactive environmental practices, like reducing greenhouse gas emissions. This implies that both external pressures and internal resources play a significant role in shap- ing CC strategies among MSMEs. Theoretical insights: Attention-based view Concerning organizational awareness and responses to CC, we draw theoretical insights from the Attention-Based View (ABV) [15,40–42]. In brief, ABV posits that organizations prioritize their attention—essentially their awareness—based on the most pressing issues impacting their organizational goals and survival [40,42]. Specifically, organizations notice, encode, interpret, and concentrate their time and effort on specific environmental concerns and strategies linked to them

[42]. As such, organizations recognize contextual factors as key drivers for understanding and assessing their vulner- ability to CC [41]. Indeed, organizations allocate their attention and resources to strategies that integrate sustainability objectives with operational goals, ensuring alignment between environmental and business imperatives, thus, responding selectively to ecological pressures and normative discourses [42]. However, firms that perceive CC as a low-priority issue tend to focus solely on financial value creation, prioritizing short-term profitability over sustainability. Importantly, perceived ecological pressures—driven by factors such as carbon market availability, the nature of the business community, and the economic sector—along with normative discourses—shaped by external pressures—may constrain firms’ strategic choices and attention toward sustainability-oriented strategies and practices. Data and methods Research paradigm and context Given the complexity and multidimensional nature of CC’s impact on business activities, this study adopts a pragmatic philosophical approach. This perspective, rooted in non-reductive naturalism, emphasizes problem-solving and practical knowledge above other considerations [43,44]. In essence, a pragmatic philosophical perspective focuses on how our social world continually unfolds through collective efforts to address the demands of modern life [44]. Such an approach highlights the importance of aligning beliefs with actions in the inquiry process that underpins the pursuit of new knowl-

edge [43]. From this standpoint, research endeavors aim to develop novel and useful insights about phenomena, enhanc- ing human perspectives, beliefs, and experiences [45]. Although existing research has emphasized the influence of contextual characteristics on MSMEs’ awareness and strategies toward CC [3], the majority of studies have focused on MSMEs within African [34,38], Asian [25,27,31,32,35], and European contexts [14,26,30,36,37,39,46], leaving the Americas relatively unexplored [3,7]. To address this gap, we conducted an exploratory, deductive quantitative study on Colombian MSMEs, aiming to deepen and expand the contex- tual understanding of CC awareness and strategic responses among these ventures within a developing Latin American country. Latin America has been widely conceptualized as a fertile context for theory building and empirical testing in the management field [47]. Colombia, as a developing nation and signatory to key international climate agreements—includ- ing the United Nations Framework Convention on Climate Change (1992), the Kyoto Protocol (1998), and the Paris Agreement (2015)—has committed to ambitious climate goals. These include a 51 percent reduction in greenhouse gas emissions by 2030 and the achievement of carbon neutrality by 2050. To this end, Colombia has established industry- specific targets under Law 2169/2021, focusing on sectors such as mining and quarrying, tourism, and manufacturing.

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 5 / 26 For this purpose, since 2016 Colombia has pursued a continual legislative agenda to reduce CC [48,49]. Specifically, it has ratified several green tax laws targeting greenhouse emissions from producers and importers of fossil fuels (Law 1819/2016). In addition, the Colombian government has imposed a specific tax for each ton of greenhouse emissions (i.e., 25,799.56 Colombian pesos- approximately 6.37 United States Dollars- in 2024) for highly polluting and resource- intensive industries. More so, several Colombian governments have established general CC regulations for large firms, financial corporations, and firms within the energy sector (Law 1931/2018). These regulations compel enterprises to elab- orate emission reports, mitigation and adaptation plans, and environmental responsibility strategies, establishing various economic incentives to reduce greenhouse emissions. Fig 1 illustrates the geographical scope of our research, which falls under the administrative jurisdiction of the larg- est business association in Colombia. This meta-organization oversees nine provinces within the Cundinamarca region: Bogotá, Sumapaz, Soacha, Oriente, Sabana Centro, Guavio, Medina, Almeidas, and Ubaté. These provinces encompass 59 municipalities and the capital city, forming a business community of 495,981 active ventures as of 2023 [50]—repre- senting approximately 28.5 percent of Colombia’s active businesses. Of these, 85 percent are concentrated in the capital,

while 15 percent are distributed across the municipalities. Overall, MSMEs account for 99.3 percent of all ventures in the region. In 2023, this region contributed approximately 31.3 percent of the national Gross Domestic Product, generating Fig 1. Geographical location of the Cundinamarca Region and the research site. https://doi.org/10.1371/journal.pone.0327165.g001

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 6 / 26 around 4.1 percent of Colombia’s total carbon emissions (approximately 9.91 million tons of greenhouse gases), with nearly 15 percent of these emissions originating from ventures in the secondary economic sector [51]. Consequently, this contextual setting provides a robust foundation for addressing our research questions and objectives. Sample and survey We partnered with the largest business association in Colombia to analyze firm-level data collected through a phone survey conducted as part of the Industrial Decarbonization Project. The anonymized dataset was provided to the research team in February 2024. An independent company surveyed between May and August 2023, employing a stratified prob- abilistic sampling method to ensure a 5 percent margin of error and a 95 percent confidence level. The survey targeted key respondents within the firms—business owners, C-level executives, and sustainability managers—possessing rele- vant knowledge of environmental and sustainability-related organizational strategies and practices. Data collection was conducted via phone interviews using a structured questionnaire. Respondents provided verbal informed consent, which was recorded. The selection of this survey method was based on three interrelated factors: (1) an increased likelihood of response from key participants compared to web-based surveys, considering the cultural characteristics of Colombian

respondents; (2) budget constraints associated with implementing the Industrial Decarbonization Project; and (3) the opportunity to clarify complex concepts in real time if respondents had doubts. Previous research highlights the advan- tages of this sampling approach, emphasizing its accessibility across diverse geographical and individual contexts and the potential for respondents to feel more comfortable describing their perspectives compared to face-to-face or web-based surveys [52]. The data collection process strictly adhered to Colombian data protection regulations, including Law 1581 of 2012 and Law 1266 of 2008, and complied with the ethical principles outlined in the Declaration of Helsinki. The survey focused on three core components. First, firmographic data for each respondent, including the type of eco- nomic activity—whether the respondent was a juridical entity (i.e., formal organizations registered under Colombian busi- ness laws) or a natural person engaged in formal entrepreneurial activities. Additionally, information was collected on the economic sector, industry, and organizational size (measured by sales for juridical entities and by the number of employ- ees for natural persons). Second, respondents provided insights on their knowledge and perceptions of CC and decar- bonization, particularly their awareness of specific CC-related concepts. Respondents were also asked to identify entities within their value chain perceived to be at risk due to CC. Further questions focused on their awareness of CC strategies,

distinguishing between those endorsed at the corporate level and those applied operationally. Finally, respondents shared their perceptions and awareness regarding carbon neutrality within their ventures. This section comprised three ele- ments: the timeline in which they anticipated achieving carbon neutrality; their awareness of strategies at both corporate and operational levels aimed at attaining this sustainability goal and whether they had implemented any carbon-related practices or programs, and; lastly, factors that might influence their awareness of carbon neutrality, including leadership diversity, perceived pressure from key stakeholders (such as customers and investors), and awareness of the carbon mar- ket at the national level. Variables and measures In line with our research paradigm, we focused on policy-relevant variables related to CC and carbon neutrality. First, we conceptualized CC awareness as respondents’ perceived knowledge of key concepts, including “Global Warming,” “Climate Change,” “Greenhouse Gas Mitigation,” “Adaptation to Climate Change Impact,” “Offsetting of Greenhouse Gas Emissions,” “Carbon Neutrality,” and “Decarbonization.” Respondents rated their knowledge of these concepts using a 5-point Likert scale, ranging from “Low Knowledge” to “High Knowledge.” Additionally, we measured perceived risk associated with CC based on three potential impacts: direct impact on the firm itself, external impact on the supply chain (both on suppliers and customers), or no impact from CC at all. Additionally, we assessed strategic awareness of CC by

examining whether respondents were knowledgeable about strategies at both the corporate and operational levels. At the

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 7 / 26 corporate practice level, we considered awareness of practices such as using sustainable transportation (e.g., electric or hybrid vehicles), analyzing and measuring carbon footprint indicators, engaging in voluntary tree planting and refor- estation, purchasing or issuing green bonds, and producing green energy. At the operational process level, we examined awareness of energy reduction and efficiency programs, environmental policy implementation, networking with clusters and associations focused on CC, adopting hybrid work models to reduce carbon emissions, green planting initiatives, and waste reclassification practices. In addition to assessing strategic awareness, we identified the anticipated timeline for ventures to achieve carbon neutrality. Respondents were asked to choose from several options: within 5 years, between 6 to 10 years, between 11 to 20 years, more than 20 years, not in the company’s interest, deemed infeasible, or unknown. We also evaluated knowl- edge of specific carbon-neutral strategies at both the corporate and operational levels. At the corporate practice level, we considered strategies such as compensating for carbon emissions through reforestation or biodiversity restoration, imple- menting shared transport systems for employees, purchasing green bonds, and establishing “life fences” to enhance bio- diversity. At the operational process level, we focused on practices like conducting environmental diagnostics of corporate

impacts, optimizing the use of raw materials, providing training in environmental and energy management, adopting clean energy sources, and implementing comprehensive waste management systems. To further analyze the factors influencing ventures’ awareness toward carbon neutrality, we incorporated several elements that describe external pressures and normative discourses shaping sustainability-oriented decisions. First, we included a dummy variable to assess whether organizational decisions were made by a gender-balanced executive team (i.e., 50 percent male, 50 percent female at the C-level), assigning a value of 1 if gender-balanced leadership was reported. Additionally, two dummy variables captured perceived pressures from key stakeholders: one indicating whether customer pressures were perceived as relevant or very relevant, and another for investor pressures. Each variable was assigned a value of 1 if the venture perceived these pressures as relevant or very relevant. Furthermore, we complemented our analysis with two dummy variables measuring perceived support from the govern- ment and key stakeholders (employees). A value of 1 was assigned if the venture perceived these sources of support as relevant or very relevant. Additionally, we considered internal constraints by incorporating dummy variables reflecting capi- tal (i.e., financial, human, or time) and technological barriers. Each variable was assigned a value of 1 if the venture identi- fied these barriers as relevant. Lastly, we created three dummy variables to capture ventures’ awareness and engagement

with carbon neutrality initiatives: (1) knowledge of carbon markets, assigned a value of 1 if the venture reported aware- ness of such markets; (2) involvement in carbon-neutral practices, assigned a value of 1 if the venture actively engaged in these practices; and (3) participation in organizational programs related to carbon neutrality, assigned a value of 1 if the venture was involved in such programs. Data analysis Our data analysis consisted of three interrelated steps. First, we employed descriptive analysis techniques to identify com- mon patterns regarding ventures’ awareness of CC and their strategic decisions toward carbon neutrality. Specifically, we categorized ventures into different subsamples based on organizational type and economic sector, focusing on compar- ing means across these subgroups. This descriptive analysis aimed to highlight variations and commonalities to uncover potential awareness gaps and shortcomings that could guide future research and the development of targeted public pol- icies and interventions [27,36,38,53]. Subsequently, for each category of analysis, we conducted a non-parametric Pear- son chi-square (X2) test of homogeneity [54] to assess the distributional similarities within subgroups. This test enabled us to determine whether two or more populations shared similar distributions across a single categorical variable. We per- formed each test using the ‘chisq.test’ function from the ‘stats’ package in R, applied to count-based contingency tables.

For each test we computed the p-value based on the asymptotic chi-squared distribution of the test statistic. The code and data supporting these analyses are publicly accessible via the DOI provided in the Data Availability Statement.

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 8 / 26 Lastly, we examined the factors influencing ventures’ awareness regarding (a) the feasibility of achieving carbon neu- trality within five years and (b) whether carbon neutrality was perceived as unfeasible or not part of their strategic plan. To analyze these decisions, we employed a Probit model with robust standard errors. This model incorporated independent variables related to awareness, including capital and technology barriers, gender balance in leadership, perceived pres- sures from customers and investors, perceived support from the government and key stakeholders (employees), ventures’ awareness of carbon markets, and the adoption of carbon-related practices and programs. To mitigate potential omitted variable bias, we controlled for economic sector and organizational characteristics. The code and data supporting these analyses are publicly accessible via the DOI provided in the Data Availability Statement. Results MSMEs description Initially, we explored the nature of the sample obtained through the survey, categorizing each respondent based on their nature (whether juridic or natural person). Given the scarcity of empirical studies exploring the perceptions, awareness, and CC strategies among non-large organizations, we developed three categories that encompass the majority of Colom- bian business ventures [55,56]: (a) Self-employed -SE- (i.e., single natural individuals who manage all business functions

independently, that is, without employees); (b) Small Business Owners -SBO- (i.e., single natural individuals with at most ten employees but lack a formal organizational structure); and (c) Micro, Small, and Medium-sized Enterprises -MSMEs- (i.e., juridical persons with a formal organizational structure). These categories were chosen to capture different types of entities within the Colombian business community, allowing for a more nuanced analysis of the MSMEs’ CC awareness and strategic responses with relevant contrasting groups. Table 1 overviews the sample distribution categorized by the nature of the respondents and their corresponding economic classification (by economic sector and industry). Most of the sample consisted of SE (44.6 percent; N = 648), followed by SBO (37.9 percent; N = 551) and MSMEs (17.5 percent; N = 254). In terms of economic sectors, most of the sample was categorized within the tertiary economic sector (64.3 percent; N = 934), followed by the secondary sector (29.6 percent; N = 430) and the primary sector (6.1 percent; N = 89). Regarding industries, most of the sample consisted of ventures in the wholesale and retail trade industry (Tertiary Sector; 35.2 percent; N = 512), followed by manufacturing industries (Secondary Sector; 26.1 percent; N = 379) and accommo- dation and food services (Secondary Sector; 6.2 percent; N = 90). Overall, the sample distribution is representative of the research context under study, as it reflects the predominant economic activities within such, emphasizing the significant

presence of the tertiary sector over the other ones. Awareness: From global warming to decarbonization Subsequently, we explored the awareness-perceived knowledge of the sample regarding CC and decarbonization (please refer to Table 2 for an overview). Panel A of Table II summarizes the results for the overall sample. The findings indicate that ventures show a considerable familiarity with general concepts such as “Global warming” (36 percent of the sample selected “5” on the scale; Mean All = 3.79) and “Climate Change” (36 percent of the sample selected “5” on the scale; Mean All = 3.81). However, knowledge levels are more moderate for terms such as “Greenhouse Gas Mitigation” (25 per- cent of the sample selected “3” on the scale; Mean All = 2.82), “Adaptation to climate change impacts” (29 percent of the sample selected “3” on the scale; Mean All = 3.31), and “Offsetting of greenhouse gas emissions” (25 percent of the sam- ple selected “3” on the scale; Mean All = 2.70). In contrast, a significant portion of respondents was unfamiliar with “Carbon Neutrality” (38 percent of the sample selected “1” on the scale; Mean All = 2.33) and “Decarbonization” (33 percent of the sample selected “1” on the scale; Mean All = 2.57). These findings indicate that while there exists a slight common knowl- edge of general CC phenomena, more specific terms related to carbon management remain largely unknown among most respondents.

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 9 / 26 Furthermore, Panel B, C, and D in Table 2 present the results according to each category. There is a persistent trend across all types of ventures showing “High Knowledge” about concepts such as “Climate Change” and “Global Warm- ing.” Specifically, MSMEs exhibit a higher awareness level (Mean MSMEs = 3.97) in contrast to the other subsamples (Mean SE = 3.65; Mean SBO = 3.73). Moreover, the MSMEs subsample showcases a higher awareness level regarding concepts such as “Greenhouse Gas Mitigation,” “Adaptation to Climate Change Impacts,” and “Offsetting of Greenhouse Gas Emissions” (Mean MSME = 3.17) compared to the other subsamples (Mean SBO = 2.80; Mean SE = 2.80). Finally, the SE subsample shows the lowest awareness level about “Carbon Neutrality” and “Decarbonization” (Mean SE = 2.28) in contrast with the other subsamples (Mean SBO = 2.33; Mean MSME = 2.68). In summary, smaller businesses are less aware of CC strategies than larger ones. To assess the consistency of these patterns, we analyzed the distribution across categories using a Pearson chi-square (X2) homogeneity test. The results indicate statistically significant hetero- geneous behavior in the samples regarding their awareness levels on various climate-related issues: (a) Global warming (X2 = 33.08; p = 0.00); (b) Climate change (X2 = 25.10; p = 0.00); (c) Greenhouse gas mitigation (X2 = 43.72; p = 0.00); (d) Adaptation to climate change impacts (X2 = 31.17; p = 0.00); (e) Offsetting of greenhouse gas emissions

(X2 = 43.96; p = 0.00); (f) Carbon neutrality (X2 = 32.49; p = 0.00); and (g) Decarbonization (X2 = 28.58; p = 0.00). These findings highlight a significant divergence in the business community’s awareness of climate-related issues. They Table 1. Sample Description. Sectors By Economic classification SE SBO MSMEs Grand Total 254 648 551 Primary Sector 8 30 51 Agriculture, Livestock, Hunting, Forestry, and Fishing 6 23 38 Mining and Quarrying 1 1 9 Water Distribution; Sewage and Wastewater Treatment, Waste Management, and Environmental Sanitation Activities 1 6 4 Secondary Sector 36 170 224 Construction 1 12 37 Electricity, Gas, Steam, and Air Conditioning Supply 0 0 1 Manufacturing Industries 35 158 186 Tertiary Sector 210 448 276 Accommodation and Food Services 22 61 7 Administrative and Support Service Activities 8 15 19 Artistic, Entertainment, and Recreation Activities 0 8 4 Education 2 6 11 Financial and Insurance Activities 4 2 7 Human Health and Social Work Activities 2 6 4 Information and Communications 5 8 23 Other Service Activities 10 26 3 Professional, Scientific, and Technical Activities 11 24 42 Public Administration and Defense; Compulsory Social Security 0 0 1 Real Estate Activities 0 7 15 Transportation and Storage 2 10 16 Wholesale and Retail Trade 135 255 122 Other commercial activities 9 19 2 Capital investors 0 1 0 Note. SBO = Small Business Owners; SE = Self-Employed; MSMEs = Micro, Small, and Medium-sized Enterprises. https://doi.org/10.1371/journal.pone.0327165.t001

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 10 / 26 also align with recent empirical research in developing regions [57,58], which has pointed to low levels of climate change awareness among ventures—limiting the successful implementation of strategies to address its effects. Moreover, the results underscore the need for tailored learning initiatives to raise awareness of environmental challenges, fostering engagement with sustainability practices. Table 2. Awareness and Perceived Knowledge. Panel A. All sample Concept 1 2 3 4 5 Total Mean N 1 6.68 6.26 23.74 27.60 35.72 100.00 3.79 1,453 2 6.54 6.19 22.57 28.63 36.06 100.00 3.81 1,453 3 25.46 15.69 24.91 19.13 14.80 100.00 2.82 1,453 4 12.11 12.04 29.18 25.60 21.06 100.00 3.31 1,453 5 28.49 16.79 24.98 16.17 13.56 100.00 2.70 1,453 6 38.47 18.72 22.85 10.81 9.15 100.00 2.33 1,453 7 33.10 16.66 22.71 15.07 12.46 100.00 2.57 1,453 Panel B. MSMEs Concept 1 2 3 4 5 Total Mean N 1 4.90 3.81 21.05 30.13 40.11 100.00 3.97 551 2 5.44 4.54 17.79 31.58 40.65 100.00 3.97 551 3 20.15 12.16 25.05 23.77 18.87 100.00 3.09 551 4 9.98 10.53 24.32 31.58 23.59 100.00 3.48 551 5 22.50 15.79 22.69 21.78 17.24 100.00 2.95 551 6 32.67 16.88 23.96 13.79 12.70 100.00 2.57 551 7 28.86 15.61 21.05 17.60 16.88 100.00 2.78 551 Panel C. SBO Concept 1 2 3 4 5 Total Mean N 1 6.33 8.49 26.23 26.85 32.10 100.00 3.70 648 2 6.48 6.94 25.46 27.62 33.49 100.00 3.75 648

3 27.62 18.98 25.31 17.13 10.96 100.00 2.65 648 4 12.35 12.50 33.33 22.38 19.44 100.00 3.24 648 5 31.79 17.59 27.01 13.58 10.03 100.00 2.52 648 6 40.74 20.37 23.15 9.26 6.48 100.00 2.20 648 7 35.03 17.44 23.46 14.97 9.10 100.00 2.46 648 Panel D. SE Concept 1 2 3 4 5 Total Mean N 1 11.42 5.91 23.23 24.02 35.43 100.00 3.66 254 2 9.06 7.87 25.59 24.80 32.68 100.00 3.64 254 3 31.50 14.96 23.62 14.17 15.75 100.00 2.68 254 4 16.14 14.17 29.13 20.87 19.69 100.00 3.14 254 5 33.07 16.93 24.80 10.63 14.57 100.00 2.57 254 6 45.28 18.50 19.69 8.27 8.27 100.00 2.16 254 7 37.40 16.93 24.41 9.84 11.42 100.00 2.41 254 Note. Values in percentage. Concepts denote (1) Global warming; (2) Climate change; (3) Greenhouse gas mitigation; (4) Adaptation to climate change impacts; (5) Offsetting of greenhouse gas emissions; (6) Carbon neutrality (zero balance between emissions and offsets); (7) Decarbonization (hav- ing a low-emission production process). N = Sample Size. 5-point Likert scale where 1 indicates “Low Knowledge” and 5 indicates “High Knowledge”. SBO = Small Business Owners; SE = Self-Employed; MSMEs = Micro, Small, and Medium-sized Enterprises. https://doi.org/10.1371/journal.pone.0327165.t002

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 11 / 26 Risk perception: Who is most affected by climate change impact Afterward, we examined the risk perception of each type of venture regarding CC. Respondents assessed potential impact pathways, distinguishing between internal risks (i.e., the initial and most prominent CC effects on the venture itself) and external risks (i.e., the initial and most prominent CC effects on business partners such as suppliers or customers). Table 3 presents the identified risk perception and the corresponding Perceived Impact Probability (PIP). Specifically, most of the sample considers an internal impact pathway as the most likely (PIP = 0.54), followed by an external path (PIP = 0.32). Additionally, a smaller proportion of respondents believe that CC will not affect anyone (PIP = 0.09) or they lack enough information to perceive a risk (PIP = 0.01). Table 3 presents the results according to each subsample. The MSMEs subsample perceived an internal risk as most likely (PIP MSMEs = 0.59), in contrast to the other subsamples (PIP SBO = 0.50; PIP SE = 0.50). Besides, the SBO subsample perceived an external risk path as most likely (PIP SBO = 0.36), compared to other subsamples PIP MSMEs = 0.25; PIP SE = 0.35). More so, we observe that the MSMEs (PIPMSMEs = 0.14) and SE (PIPSE = 0.14) subsamples showed the highest perception of no-risk compared to the other subsample (PIPSBO = 0.13). Lastly, the SBO subsample showed the highest response indicating a lack of awareness of risks (PIPSBO = 0.02) compared to the other

subsamples (PIPMSMEs = 0.01; PIP SE = 0.01). As such, results suggest that MSMEs have varied perceptions regarding who will be most affected by CC. However, the prevalence of responses that prioritize internal stakeholders indicates a trend toward considering CC impacts within the organization’s direct sphere of influence. To assess behavioral patterns among firms, we examined the distribution using a Pearson chi-square (X2) homo- geneity test. The results indicate statistically significant heterogeneity in the samples regarding their risk perception (X2 = 30.41; p = 0.00). This finding suggests that ventures perceive climate risks differently, primarily influenced by their internal characteristics. Given their size, ventures must make strategic choices regarding key business functions (e.g., site location, capital allocation, labor management, and production patterns, among others), which shape their organizational exposure and vulnerability to climate-related pressures. The observed heterogeneity reinforces the importance of evalu- ating risks based on the resources and capabilities available to each venture while also considering potential variations in the physical, ecological, and socioeconomic systems in which they operate [59,60]. Assessing strategic awareness: Climate change management Afterward, we explored strategic awareness regarding CC management. Respondents were asked to describe their knowl- edge of strategies at both the corporate practice and operational process levels aimed at addressing the challenges their

ventures face related to CC. Panel A of Table 4 reveals that most MSMEs demonstrate higher awareness of strategies at the corporate practice level compared to those aimed at operational processes. Specifically, 54.63 percent of the MSMEs identi- fied corporate practice level strategies. Additionally, the SBO subsample showed the highest awareness regarding corporate practices level strategies (63.27 percent), while the MSMEs subsample exhibited the highest awareness at the operational Table 3. Climate Change Risk Perception. Risk Perception Pathways All Sample SE SBO MSMEs Internal 0.54 0.50 0.50 0.59 External 0.32 0.35 0.36 0.25 None will be affected 0.09 0.11 0.09 0.07 No response 0.05 0.03 0.04 0.07 Not know 0.01 0.01 0.02 0.01 Note. SBO = Small Business Owners; SE = Self-Employed; MSMEs = Micro, Small, and Medium-sized Enterprises. https://doi.org/10.1371/journal.pone.0327165.t003

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 12 / 26 processes level (27.04 percent). Moreover, we found that the SE subsample displayed the lowest awareness (11.02 percent) about strategies related to climate change compared to the other subsamples. These findings, supported by the Pearson chi-square (X2) test of homogeneity (X2 = 32.49; p = 0.00), reveal statistically significant heterogeneity across firms, regard- less of economic sector. These patterns resonate with previous empirical findings [61], which posit that most organizations exhibit a unique combination of strategies at the corporate practice level (i.e., including carbon compensation, reduction, and independence) toward shaping their long-term carbon generation. This variation underscores the importance of tailored strategies depending on the organizational characteristics, size, and economic sector that may influence the organizations’ capacity to adopt and implement effective climate-related initiatives [62]. Furthermore, we examined strategic awareness at the economic sector level. Panel B of Table 4 reveals that ven- tures within the primary economic sector exhibit a higher strategic awareness at the corporate practice level compared to the operational process level. Indeed, a significant proportion of ventures in the primary sector of the economy indicated awareness of corporate practice strategies (62.92 percent), while a smaller proportion mentioned opera- tional process strategies (15.73 percent). Notably, 23.53 percent of MSMEs in the primary sector did not respond,

Table 4. Strategic Awareness. Panel A. All sample (N = 1453) Strategic Awareness SE SBO MSMEs Grand Total At the level of corporate practices 55.91 63.27 54.63 58.71 At the level of operational processes 24.80 20.83 27.04 23.88 No response 8.27 8.02 14.70 10.60 Not aware 11.02 7.87 3.63 6.81 Total 100.00 100.00 100.00 100.00 Panel B. Primary sector (N = 89) Strategic Awareness SE SBO MSMEs Grand Total At the level of corporate practices 50.00 70.00 60.78 62.92 At the level of operational processes 25.00 16.67 13.73 15.73 No response 0.00 6.67 23.53 15.73 Not aware 25.00 6.67 1.96 5.62 Total 100.00 100.00 100.00 100.00 Panel C. Secondary sector (N = 430) Strategic Awareness SE SBO MSMEs Grand Total At the level of corporate practices 66.67 67.65 58.93 63.02 At the level of operational processes 11.11 15.29 27.23 21.16 No response 11.11 8.82 10.71 10.00 Not aware 11.11 8.24 3.13 5.81 Total 100.00 100.00 100.00 100.00 Panel D. Tertiary sector (N = 934) Strategic Awareness SE SBO MSMEs Grand Total At the level of corporate practices 54.29 61.16 50.00 56.32 At the level of operational processes 27.14 23.21 29.35 25.91 No response 8.10 7.81 16.30 10.39 Not aware 10.48 7.81 4.35 7.39 Total 100.00 100.00 100.00 100.00 Note. Values in percentages. SBO = Small Business Owners; SE = Self-Employed; MSMEs = Micro, Small, and Medium-sized Enterprises. https://doi.org/10.1371/journal.pone.0327165.t004

PLOS One | https://doi.org/10.1371/journal.pone.0327165 July 2, 2025 13 / 26 possibly indicating uncertainty or a lack of awareness regarding climate change strategies. Similarly, a substantial portion of SE ventures (25.00 percent) expressed lack of awareness of any strategy. In contrast, when examining the secondary economic sector, Panel C of Table 4 shows that MSMEs and SBO exhibit greater awareness of strategies at the corporate practice level (MSMEs = 58.93 percent; SBO = 67.65 percent) compared to operational processes (MSMEs = 27.23 percent; SBO = 15.29 percent). SE ventures in this sector demonstrated a higher awareness of strat- egies at the corporate practices level (66.67 percent), with a notable percentage (11.11 percent) indicating no response or lack of awareness. Finally, Panel D of Table 4 shows that SE and SBO in the tertiary economic sector exhibit higher awareness of strategies at the corporate practices level (SE = 54.29 percent; SBO = 61.16 percent) compared to MSMEs (50.00 percent). However, MSMEs in the tertiary sector demonstrated greater awareness of operational process strategies (29.35 percent) than SE (27.14 percent) and SBO (SBO = 23.21 percent). The above findings, supported by the Pearson chi-square (X2) test of homogeneity, indicate significant heterogeneity across economic sectors (Primary : X2 = 80.49; Secondary : X2 = 54.32; Tertiary : X2 = 54.32; p = 0.00), reinforcing the notion that ventures across different sectors exhibit varied levels of strategic CC awareness. According to previous empiri-

cal studies [63], the impact and strategic response to CC vary across the business community. Indeed, based on our anal- ysis, MSMEs exhibit heterogeneous strategic approaches to cope with the increased pressures on the operational viability of businesses, which may be constrained by the resources available within the organization [62]. These sector-specific variations emphasize the need for tailored CC strategies and educational efforts that address the unique challenges and opportunities faced by firms from different sectors. Carbon neutrality: Strategic timing and antecedents Subsequently, we explored the period upon which MSMEs expect to achieve carbon neutrality. Table 5 details the stra- tegic timing for each type of MSME. Panel A shows that a significant proportion of respondents believed they could achieve carbon-neutral emissions within five years (33.72 percent), while 42.53 percent expected to reach this goal within six to twenty years. However, a notable share of respondents expressed either a lack of interest in carbon neu- trality (15.62 percent), skepticism about its feasibility (13.08 percent), or insufficient information to estimate its timing (10.67 percent). Furthermore, the Pearson chi-square (X2) test of homogeneity (X2 = 42.01; p = 0.00) revealed statis- tically significant heterogeneity in strategic timing across SEs, SBOs, and MSMEs, indicating that these groups follow varied timelines for achieving carbon neutrality. This suggests a lack of a unified societal objective for reaching this goal.

Moreover, these results align with recent discussions on climate neutrality, that stress the absence of standardized global guidelines for establishing net-zero strategies [64,65]). This lack of clear directives has led to challenges in setting socially accepted carbon targets and designing appropriate strategies, with the approach to carbon neutrality largely influenced by company size. In turn, panels B, C, and D in Table 5 present the strategic timing by economic sector. We observe that most firms in the primary sector perceive achieving carbon neutrality in a period lower than 10 years (Mean Primary Sector = 0.71), a pro- portion that is higher than others economic sectors (Mean Secondary Sector = 0.45; Mean Tertiary Sector = 0.51). This suggests that MSMEs in the primary sector view carbon neutrality as critical for survival. The Pearson chi-square (X2) test of homo- geneity indicates homogeneity among business ventures within the primary sector (X2 = 11.90; p = 0.454). This suggests that businesses within this sector may share a common strategic approach, possibly viewing carbon neutrality as a critical component achievable in the short term. More so, we observe that a higher proportion of MSMEs from the secondary sec- tor (Mean Secondary Sector = 0.12) perceive achieving carbon neutrality in a period higher than 10 years but lower than twenty years. This proportion is higher than others economic sectors (Mean Primary Sector = 0.05; Mean Tertiary Sector = 0.08). This

result could imply that MSMEs from the secondary sector may plan and invest with a long-term perspective to achieve sig- nificant changes in their production processes. This perspective is further supported by the Pearson chi-square (X2) test of homogeneity, which indicates homogeneity among ventures within this sector (X2 = 17.06; p = 0.148), thus, suggesting