What is green business and why is it important?
Every week in your work, studies, media or conversation you hear terms like ESG, green transition, sustainable development, renewable energy, lithium (lithium batteries)… You hear and listen about ecology, discussions about whether electricity should be more expensive or not, how to do it most efficiently heat in the apartment or house, and similar issues.
Green business, also known as sustainable business, refers to organizations that act responsibly towards the environment. These include recycling, energy management and sustainable sourcing. In a time of climate change, depleted resources and pollution, the importance of green business is undeniable.
Opportunities for green business in Bosnia and Herzegovina
The field of green business offers young entrepreneurs exceptional progress in innovation and leadership potential. New businesses in Europe focusing on renewable energy solutions, waste, sustainable agriculture and environmentally friendly products are on the rise. Growth is guaranteed locally and internationally, as businesses in this sector can keep pace with the growing global demand for sustainable goods and services.
To help bring this together, young leaders get the resources, mentors and networks they need to be successful. With such platforms, entrepreneurs will have the opportunity to develop those skills and knowledge that will help them navigate the green business world with excellent efficiency. (Rolify regularly monitors “green” initiatives, events and programs, so don’t forget to scroll through the latest news on this platform at least weekly).
EU regulations and their impact
As Bosnia and Herzegovina approaches EU membership, small and large entrepreneurs should be aware of some key EU regulations that could significantly change their business. Each legal act is a story in itself, but let’s briefly mention a few key regulations that are current and that annually increase obligations for entrepreneurs and companies until 2030:
1. Mechanical Carbon Border Adjustment System (CBAM): This EU regulation, by introducing a fair price on the carbon generated during the production of goods imported into the EU, will aim to prevent carbon leakage so that imported goods are subject to similar carbon prices as those produced within the EU. This regulation primarily affects industries such as iron, steel, cement, fertilizers, aluminum, hydrogen and electricity generation.
2. Corporate Sustainability Reporting Directive (CSRD): This directive requires companies to publish data on the social and environmental consequences of their business activities. Expands scope to more companies and more detailed reporting requirements, ensuring transparency and accountability.
3. EU ETS – European Emissions Trading System: The system relies on the cap-and-trade principle, which sets maximum levels of total quantities of certain types of greenhouse gases that can be emitted. Companies receive or buy emissions permits that they can trade as needed, encouraging emissions reductions.
4. Renewable Energy Directive (RED III): The Directive sets mandatory EU targets for renewable energy, promoting the use of renewable energy in electricity, heating, cooling and transport.
5. Energy Efficiency Directive (EED): This Directive sets out the framework for actions to be taken to improve energy efficiency across the EU, setting targets for energy savings and requiring Member States to implement policies to achieve these targets.
Challenges and how to overcome them
The green growth business sector holds enormous potential, but several questions face reality right at the start of your journey. These include limited access to finance, regulatory challenges and lack of awareness of sustainable practices in Bosnia and Herzegovina. All these problems require cooperation between the public and private sectors, and the authorities at all levels in BiH will be faced with the challenge of legal adaptation and facilitation for entrepreneurs – under the pressure of the demanding European market – whether they are ready or not. Encouraging consumer demand and support through improving education and understanding of the entrepreneurial benefits of green business is another way.
Sustainable business is the everyday reality of today’s children who attend kindergartens or go to school. All of them will be students or career-oriented people in a few years. Therefore, their education about green business must start now. Environmental sections have been an integral part of the extracurricular activities of almost every elementary school in Bosnia and Herzegovina for decades, but it is necessary to think, act and train future generations outside of this framework. This methodological approach is no longer sufficient and it is necessary to introduce sustainable development through permanent education adapted to preschool and early school ages.
Entrepreneurs can access all kinds of financial markets, including influential investors and crowdfunding platforms specialized in projects aimed at sustainability. In addition, cooperation with international bodies and engagement in global sustainability networks can generate vital support and exposure for your business.
Practical advice for young entrepreneurs
Regardless of whether you invest part of your money or have won certain grant funds, or you have connected with investors who will push you financially, money is prone to burnout quickly no matter how much you have in the account of your business venture . Therefore, even before you invest or spend even one KM or EUR for your business, take some steps:
1. Find a niche: Examine the market in your area to discover gaps in areas of green business such as renewable energy, recycling or sustainable agriculture. But don’t limit yourself to BiH or just the region. An insight into how it works in the European Union can give you additional inspiration: EU environmental initiatives
2. Explore opportunities for co-financing and support : available research grants and incentives. The Western Balkans Investment Framework (WBIF) is a useful stop to learn more about green investing : WBIF
3. Stay up-to-date: Follow legislative and market changes, especially those related to EU standards and carbon pricing mechanisms. Entity ministries are step number 1, where you can find all valid legal regulations that are relevant when it comes to “green business”.
Federation of Bosnia and Herzegovina (FBiH):
Federal Ministry of Environment and Tourism
Federal Ministry of Energy, Mining and Industry
Federal Ministry of Agriculture, Water Management and Forestry
Republika Srpska (RS):
Ministry of Spatial Planning, Construction and Ecology
Ministry of Industry, Energy and Mining
Ministry of Agriculture, Forestry and Water Management
4. Networking and collaboration: Network with local and global networks to share knowledge, resources and experiences. Being active through platforms that follow green initiatives can provide valuable insights and information on how to position yourself in the market.
Regional Energy Efficiency Program
European Fund for Southeast Europe (EFSE)
EBRD Green Economy Financing Facility (GEFF)
The green business revolution is here, and with it are young entrepreneurs. By utilizing the country’s natural resources and following international trends in sustainability, future entrepreneurs can create businesses that not only bring profit but also benefit the environment.
Source: rolify.com
