The challenges of our time – climate change, inequality and environmental degradation – require urgent and innovative solutions. Traditional profit-driven business models often contribute to these crises, but business itself has the potential to transform. By redefining success to prioritize environmental stewardship, economic inclusion and social well-being, businesses can be a driving force in achieving the Sustainable Development Goals (SDGs).
Young green and social entrepreneurs are at the heart of this transformative change. These leaders of change bring passion, innovation and a fresh perspective to solving complex social and environmental problems. However, despite their potential, they face significant barriers to expanding their impact. Youth Business International (YBI)In cooperation with the member of Mongolia, Development SolutionsAs outlined in our recent policy document, this advocates a global movement to better support young people.“Promoting and Supporting Green and Social Business Models Among Young Entrepreneurs to Advance the Sustainable Development Goals”.
The Critical Role of Green and Social Entrepreneurs
Social and green enterprises are more than businesses; they are catalysts for systemic change. According to the World Economic Forum, globally, social enterprises generate nearly $2 trillion in revenue and create nearly 200 million jobs each year. These impact-based enterprises are essential for sustainable economic development by directly contributing to the SDGs by addressing issues such as poverty, education, clean energy and climate action.
Young entrepreneurs are particularly well suited to lead this movement. Driven by a deep commitment to making a difference, they approach business with a purposeful mindset, incorporating social and environmental goals into their operations. A 2022 study commissioned by the YBI found that young entrepreneurs under the age of 35 were twice as likely as their older counterparts to prioritize solving social or environmental problems through their business.
These young leaders bring a unique combination of local insight and global awareness, leveraging emerging technologies and innovative business models to drive impactful change. However, they need the right support systems to grow their businesses.
Barriers Holding Back Effective Youth-Led Enterprises
Starting a business is never easy, but the hurdles are especially high for young entrepreneurs with green or social missions. Among the most pressing problems:
- Access to finance: Investors often consider green and social enterprises riskier due to their longer payback period. Young entrepreneurs struggle to secure funding, with less than 15% of social enterprises in low-income countries accessing adequate funding.
- Adjustment complexity: Uncertain and fragmented regulatory environments can hinder the growth of social and green enterprises. Without harmonized legal frameworks, these businesses face unnecessary operational barriers.
- Consumer acceptance: While consumer interest in sustainable products is growing, price sensitivity and skepticism remain barriers. For young entrepreneurs with limited marketing budgets, competing with established brands can be difficult.
- Supply Chain Issues: Ensuring environmentally and socially responsible supply chains is both expensive and logistically complex, especially for startups.
- Impact measurement: A tangible social or environmental impact is important to attract investors and customers. However, the lack of standardized metrics and limited resources for impact evaluation complicate this process.
Call to action
If we want to unlock the potential of young green and social entrepreneurs, we need governments, businesses, investors and civil society to come together to create a supportive ecosystem. YBI and Development Solutions urge stakeholders to take the following actions:
- Creation of youth-oriented funds: Governments and financial institutions should create investment funds specifically targeting youth-led green and social enterprises, combined with tax incentives for investors.
- Simplify the rules: Streamline legal processes and provide tailored frameworks that recognize and support the unique needs of social and green businesses.
- Promote Green Promotions: It makes green alternatives more competitive and accessible by providing subsidies and tax breaks for businesses that produce sustainable products.
- Ensure supply chain integrity: Support young entrepreneurs in building transparent and responsible supply chains through tools, partnerships and incentives.
- Standardize Impact Metrics: Develop unified frameworks to measure impact and provide training to help entrepreneurs effectively communicate their results.
- Enter Education Skills: Integrate green and social entrepreneurship skills into educational curricula to prepare the next generation of change-makers.
Building a Movement for Change
The challenges we face today cannot be solved by efforts alone. They require a collective commitment to foster innovation, collaboration and sustainability. Supporting young green and social entrepreneurs is not only about helping individual businesses succeed, but also about transforming economies and creating a sustainable, fair future for all.
It’s time for action. Together, we can empower the next generation of changemakers to advance the Sustainable Development Goals and build a world where business truly serves people and the planet.
Join us in this vital action. Explore the policy document of YBI and Development Solutions »Promoting and Supporting Green and Social Business Models among Young Entrepreneurs to Advance the Sustainable Development Goals” here.
