What is green entrepreneurship?

Amid escalating environmental challenges and climate change, green entrepreneurship has emerged as a vital pathway to achieving environmental sustainability. It involves the creation and implementation of business ideas that contribute to environmental conservation, reduce waste, and promote the use of renewable resources. However, green entrepreneurs often face several challenges, including higher costs associated with sustainable materials and processes, difficulties in accessing finance, and challenges in convincing consumers to pay a premium for eco-friendly products.

A prime example of green entrepreneurship is Method, a home cleaning products company that has become a leader in the eco-friendly cleaning products market. From the outset, Method's founders aimed to create products that were not only effective but also more sustainable than their competitors. This included using plant-based ingredients and recycled materials for their packaging. Despite facing initial challenges in securing funding and attracting consumers, Method has become a billion-dollar company and has inspired other businesses to adopt more sustainable practices.

The Role of Education and Support

One of the key factors influencing green entrepreneurial intentions is the level of education and support available to entrepreneurs. A study conducted by Aldo Alvarez-Risco et al. assessed the influence of education development support, conceptual development support, and country support on entrepreneurial self-efficacy and green entrepreneurial intentions among business students in Ecuador. The study found that educational support for developing entrepreneurship, conceptual support for developing entrepreneurship, and country support for entrepreneurship had a positive influence on entrepreneurial self-efficacy. Additionally, entrepreneurial self-efficacy had a positive influence on green entrepreneurial intentions. These findings suggest that providing adequate education and support can enhance the ability of entrepreneurs to carry out green entrepreneurship and contribute to ecological ventures.

The Finnish government has implemented a comprehensive system of support, including programmes that provide access to technical expertise, business mentoring, and financial resources. They have also created strong public-private partnerships to facilitate the exchange of knowledge and expertise. This has helped to create a thriving ecosystem of green entrepreneurs, including companies like Fortum, a leading producer of sustainable energy solutions. As a result, Finland has become a global leader in sustainable business practices.

Environmental Management and Green Branding

Effective environmental management is also crucial for the success of green entrepreneurship and sustainable business ventures. A study conducted by Luidmula Starchenko et al. examined the relationship between environmental management and green brand at the company level. The study found that companies with effective environmental management had a higher net profit and loyalty to the green brand. This suggests that implementing effective environmental management practices can not only contribute to environmental sustainability but also enhance the financial performance and brand loyalty of the company.

So, this shows that companies that take the time to develop robust environmental management systems, such as implementing environmental policies and procedures, monitoring and measuring environmental impacts, and continuously improving environmental performance, can really see a positive return on their investment. It's not just about doing the right thing for the environment; it's also about the bottom line. In terms of an example, let's look at IKEA. IKEA is well known for its robust environmental management system, which includes the use of sustainable materials and the promotion of sustainable consumption habits among consumers.

Ecopreneurship and User Business Models

Ecopreneurship involves the adoption of radical environmental technologies and user business model innovation by established ventures. A study conducted by N. Abdelkafi and E. Hansen examined ecopreneurship in established ventures that serve as early adopters of radical environmental technologies in the e-mobility sector. The study identified four patterns of entrepreneurial user business models in e-mobility: predominantly simple use, complementary business, feedback to core business, and additional business. The study also explored the transformation path of a case company, which started with simple use and then moved to the feedback to the core business pattern. These findings suggest that adopting user business models can facilitate the diffusion of environmental technologies and contribute to industry transformations.

Volvo is adopting user business models in e-mobility by developing vehicles with the option to lease batteries instead of purchasing them. This user business model has several benefits: it reduces the initial cost of the vehicle for the customer, it allows Volvo to retain ownership of the batteries and optimise their lifecycle management, and it provides a more sustainable way of using electric vehicles. With this model, Volvo is positioning itself as a leader in e-mobility, while also creating value for its customers and the environment.

Blockchain Technology and Green Innovation

Blockchain technology has been heralded as a game-changer for addressing severe environmental and economic sustainability challenges. A study conducted by M. R. H. Polas et al. investigated the role of blockchain technology in green innovation practices and its impact on green economic sustainability among small- and medium-sized enterprises (SMEs) in Peru. The study found that sustainability orientation and sustainability attitude had a positive and significant effect on the adoption of green innovation that employs green energy (solar) technology towards a sustainable green economy. Additionally, the intention to use blockchain technology mediated the relationship between sustainability orientation and social perception with the adoption of green innovation. These findings suggest that embracing green innovation and blockchain technology can protect the environment, boost community cohesiveness, and contribute to green economic sustainability.

One example is the IBM Food Trust, which is a blockchain-based network that helps to track and monitor the movement of food through the supply chain. This makes it easier to trace food contamination and ensure food safety, which can have a positive impact on the environment and public health. There are also blockchain-based platforms that are being used to promote sustainable supply chains and fight deforestation.

Green entrepreneurship is crucial for achieving environmental sustainability and combating climate change. Providing adequate education and support, implementing effective environmental management practices, adopting user business models, and embracing green innovation and blockchain technology are all key strategies for promoting green entrepreneurship and sustainable business ventures. Governments, universities, and organisations should work together to provide the necessary support and incentives to green entrepreneurs and facilitate the adoption of innovative technologies and practices that contribute to environmental sustainability.

It's important to emphasise the need for policymakers and regulators to support green entrepreneurship by creating incentives and removing barriers that discourage green innovation and investment. Additionally, the media has an important role to play in raising awareness about the benefits of green entrepreneurship and sustainability, and in changing public perceptions about these issues.

Consumers also have a role to play by demanding more environmentally friendly products and services, and by supporting businesses that are taking steps to operate in a more sustainable way.

References

• Factors Affecting Green Entrepreneurship Intentions in Business University Students in COVID-19 Pandemic Times: Case of Ecuador by Aldo Alvarez-Risco et al.
• Environmental management and green brand for sustainable entrepreneurship by Luidmula Starchenko et al.
• Ecopreneurs' creation of user business models for green tech: an exploratory study in e-mobility by N. Abdelkafi and E. Hansen
• Blockchain Technology as a Game Changer for Green Innovation: Green Entrepreneurship as a Roadmap to Green Economic Sustainability in Peru by M. R. H. Polas et al.