(Finance) – General and the UNDPthe United Nations Development Programme, brought together representatives of the Ministry of Finance of the Malaysiafrom Bank Negara Malaysia, SME Association of Malaysia and the insurance and finance industry to present concrete solutions on how increase the resilience of small and medium-sized enterprises (PMI) compared to climate changes and other risks. The event took place as part of the partnerships between Generali andInsurance and Risk Finance Facility of UNDP to reduce the protection gap for vulnerable communities and raise awareness on these issues, to establish how the insurance sector can promote safety, sustainability and greater resilience for SMEs in developing countries.
Generali is also expanding its operations in Asia SME EnterPRIZE projectbuilding on efforts over the past three years with thousands of SMEs across Europe to celebrate and cultivate a culture of sustainability.
During the event a joint report entitled “Building MSME Resilience in Southeast Asia”, focusing on selected value chains in Thailand and Malaysiawhich proposes an alternative approach for identify the risks and needs of micro, small and medium-sized enterprises (MSMEs), representing the majority of businesses in Southeast Asia (99.6% in Thailand and 97.4% in Malaysia), with the aim of developing insurance and risk management services, and distributing these solutions to businesses.
The report finds that the growth and survival of SMEs are threatened by a series of risks, including climate change, business disruption and limited access to capital markets. These are intensified by the lack of adaptation and risk management mechanisms, as well as insurance coverage: less than 5% of MSMEs in Southeast Asia, in fact, have some form of insurance.
Research integrates the SME EnterPRIZE White Paper developed as part of the Generali initiative aimed at promoting a culture of sustainability among SMEs. Generali and UNDP also presented the “SME Loss Prevention Framework”, a digital tool that exploits the potential of data to promote the preparation and awareness of SMEs in the face of risks to communities in vulnerable contexts, starting from Malaysia and the risk of flooding. Hosted on an easy-to-use online platform, the framework will also developed as an app and may be expanded to include other countries in Asia and around the world.
The event in Malaysia will also offer four innovative solutions to improve the resilience of SMEs faced with various risks, including climate risks. In the coming months they will be announced finaliststwo of which will receive up to 40,000 US dollars each, as well as technical assistance to support the development of their ideas and the opportunity to leverage the global presence of Generali and UNDP.
Jaime Anchústegui MelgarejoCEO International of Generali, said “the MSME community in Malaysia, Thailand and the wider Asian region is indispensable to the growth and development of these markets. However, they face very real and growing risks due to change climate and other factors that impact business continuity and the ability to seize new opportunities. Insurance is at the heart of the solution to make micro and small-medium enterprises more resilient and is the
driving force of the partnership between Generali and UNDP”.
Rob Leonardi, International – Asia Regional Officer of Generali, said “MSMEs and MSMEs have long been a key driver of growth and innovation in Asia. Their contribution to the development of the region is indisputable, but they are increasingly vulnerable to risks arising from climate change, geopolitical and market tensions. Our partnership with UNDP recognizes these challenges and intends to use insurance and risk financing solutions to increase coverage of MSMEs and increase their resilience.”
Lucia SilvaGroup Chief Sustainability Officer of Generali, recalled that “promoting a culture of sustainability among SMEs and ensuring their financial resilience means supporting sustainable development and reducing the protection gap for vulnerable communities”.
Niloy BanerjeeUNDP Malaysia Local Representative, said “we must rapidly support the development of resilience and resistance of SMEs in the face of all foreseeable risks through holistic and innovative solutions and tools – and insurance represents one of the most important for SMEs”.
Jan KellettGlobal and Corporate Lead on Insurance and Risk Finance, Team Leader of UNDP’s Insurance and Risk Finance Facility, added that “in ASEAN, where MSMEs account for 45% of the region’s GDP, vulnerability to rapidly increasing risks such as Climate risks represent not only a development challenge, but also an immense opportunity for the public and private sectors to collaborate and help businesses develop their capacity to understand and manage these risks.”