Bringing international “green” standards closer to Vietnamese SMEs

Under pressure from stringent export market regulations such as the Carbon Border Adjustment Mechanism (CBAM) and the EU Deforestation Regulation (EUDR), green transformation and meeting ESG standards have become mandatory conditions for Vietnamese small and medium-sized enterprises (SMEs) to maintain orders and participate in the global supply chain. However, with major resource barriers and the complexity of international standard systems, many businesses remain confused and do not know where to start. Practical solutions ranging from standard localization and building a 5-step roadmap to the companionship of associations and large corporations are serving as the "key" to bringing international green standards closer to the Vietnamese SME sector. 

Localization of GRI standards: Removing language and terminology barriers

A strategic step helping international green standards reach Vietnamese SMEs is the publication of the complete Vietnamese translation of the GRI Standards by the Global Reporting Initiative (GRI), including universal standards, sector standards, and topic standards, provided completely free of charge.

In the current context, meeting ESG standards, ensuring information transparency, and traceability have become mandatory "entry tickets" for businesses to participate in the global value chain. Nevertheless, according to Mr. Nguyen Cong Minh Bao, Country Director of GRI Vietnam, the biggest barrier for SMEs lies not only in the shortage of financial resources, but also in the complexity of international standard systems. The boom of a series of new terms and regulations such as CBAM, CSRD, EUDR, GRI, ISSB, or ESRS has been causing many business owners to fall into a state of bewilderment, not knowing where to begin.

Analyzing this reality further from a regional perspective, Dr. Allinnettes Adigue, Head of the GRI ASEAN Network, pointed out 3 core barriers preventing most SMEs from preparing sustainability reports: limited resources, the absence of mandatory legal regulations, and a shortage of specialized personnel. In small-scale enterprises, staff often have to multitask across operations, sales, business, and finance, making it extremely difficult to allocate separate time and human resources for sustainability reporting.

The appearance of the localized GRI Standards is a direct solution to these thorny problems. The greatest value of the Vietnamese-language set of standards does not stop at overcoming language barriers, but lies in its capacity to cross-reference and directly connect GRI requirements with current laws in Vietnam. Reading and understanding this set of standards helps businesses realize that applying GRI not only serves distant export reports, but also immediately helps meet mandatory domestic legal regulations.

In addition, the localization of standards also promotes a fundamental change in the implementation mindset of businesses. Instead of viewing sustainability reporting as a passive compliance requirement or a cost burden, GRI guides SMEs to start by identifying material risks to their actual business operations. According to Ms. Esther An, member of the GRI Supervisory Board, transparent and comparable data will help businesses enhance their resilience to volatility, gradually build solid trust with investors, and increase competitiveness in the market.

Not stopping at theory, the feasibility of applying green standards is also proven by opportunities to access actual capital flows. GRI has actively cooperated to promote strategic partnerships between the ASEAN Sustainable and Impact Alliance and Golden Gate BCE Group, mobilizing approximately USD 210 million for pilot projects in key industries such as cocoa and coffee. This model not only helps mitigate climate risks but also directly supports farmers and SMEs in enhancing product value and completing traceability standards to easily access green finance sources.

Bringing the localized GRI Standards and accompanying support programs like the STAR Accelerator closer to the business community has simultaneously removed three bottlenecks: language, legal compliance, and operational capacity. This is an important initial foundation for SMEs to gradually standardize data, meet international green standards, and proactively participate more deeply in the global value chain.

Recommendation for a 5-step ESG practice roadmap: Flexible and manageable

To help SMEs approach ESG without falling into fragmented investment or cost overload, experts recommend a 5-step implementation roadmap tied to practical business problems:

1. Assess ESG maturity level: Compare current operations against international standard frameworks to identify gaps and avoid wasteful investment in unnecessary criteria.
2. Leverage existing systems: Integrate ESG content into existing quality or environmental management systems (such as ISO 9001, ISO 14001) instead of building from scratch.
3. Prioritize buyer requirements: Focus resources on resolving ESG criteria that customers or major partners in the supply chain directly demand (such as emission reduction, labor safety, traceability) to retain orders.
4. Incorporate ESG into financial planning: Pre-calculate the costs of technology transformation, auditing, and certification in long-term plans to avoid being caught off guard before compliance deadlines.
5. Leverage green finance: Build reliable ESG data collection and measurement systems early to qualify for green credit or sustainability-linked loan packages from banks.

This roadmap alleviates the hesitation of SMEs by allowing businesses to implement ESG in phases, such as digitizing data, applying small software modules from the beginning, and gradually integrating them into an overall ESG certification package.

Translating green standards into practical operating models

Besides theoretical standards and roadmaps, reality shows that many Vietnamese businesses have proven international green standards can be completely realized through specific technical solutions in daily operations. Instead of viewing ESG as a burden, businesses proactively seek to turn green requirements into a true competitive advantage.

A typical example in the fashion industry is Fashion Connection Company (Faslink), which chose the direction of utilizing by-products from discarded pineapple leaves after harvest to develop spinning technology. During this process, the business proactively measures the CO2 emissions reduced by avoiding burning by-products while inviting independent auditing units to verify the data. Proactively building a transparent data set from the beginning helps products easily prove their origin and meet the requirements of demanding export markets.

In the agricultural and spice sector, the major challenge lies in the decentralized collection from millions of smallholder farmers. To solve the problem of traceability and cross-contamination risk control, Nedspice Vietnam Spice Processing Company has proactively applied modern technology such as unmanned aerial vehicles (drones) to survey cultivation areas. Digitizing raw material region data early helps businesses build a transparent supply chain, meeting strict environmental standards of the European market in advance even when mandatory regulations have not yet officially applied to this commodity.

In addition, optimizing energy at factories is also a direct solution helping businesses cut operating costs while meeting emission reduction standards. The practical model at Prime Tien Phong Factory shows that the synchronous application of rooftop solar power, waste heat recovery, biomass fuel, and the integration of IoT technology into line management has brought clear operational efficiency. These models are vivid proof that green standards are not far-fetched, but can entirely begin with specific technical improvements, helping SMEs both lower costs and step confidently into the global supply chain.

Building a companion network and support ecosystem for SMEs

Through the green transformation journey, the small and medium-sized enterprise sector cannot shoulder all costs and technical barriers alone. Close connectivity between business representative organizations and leading corporations plays an important supporting role, helping SMEs enhance their adaptive capacity and avoid being left behind.

Typical of the proactiveness from support organizations is the strategic cooperation agreement between the Vietnam Chamber of Commerce and Industry (VCCI Ho Chi Minh City Branch) and the Ho Chi Minh City Small and Medium Enterprises Association (HCM-SME). Through this cooperation, the two sides focus on representing the voice of the business community to petition for policy improvements, remove legal barriers, and organize in-depth training programs on green governance and support SMEs in accessing preferential capital and new technologies.

Alongside policy support, creating spaces for practical learning among businesses also brings practical effectiveness. The “Go Together” initiative initiated by SCG Group, through a series of activities like the ESG Company Tour, has created conditions for SME business owners to visit green operating models at pioneering factories firsthand. Observing how solar power, heat recovery, and line management are implemented helps SMEs relieve anxiety and learn practical experiences to confidently apply suitable models to their own businesses.

Building a comprehensive support ecosystem – from legal consulting and governance training to field networking – is the solid foundation for SMEs to gradually transform green standards on paper into practical actions, creating momentum to participate more deeply in the global value chain.

International “green” standards are no longer a frightening barrier if Vietnamese small and medium-sized enterprises choose a suitable and proactive approach: understanding regulations clearly through the localized GRI Standards, applying ESG practices according to a flexible 5-step roadmap, gradually greening from small technical solutions, and relying on the support ecosystem from associations and large corporations. Methodical preparation from today is the decisive “green passport” for SMEs to maintain orders and break through in the global economy.