THE COST OF GOING GREEN: How can SMEs plan for reducing their environmental impact?

With businesses across the UK seeking to reduce their impact on the environment – for a variety of reasons – Sarah Case looks at the challenges of going green and suggests five steps to sustainability.

For small and medium-sized businesses across the UK, the practice of adopting more environmentally-friendly policies doesn’t just make sense from the perspective of saving the planet, it also makes good business sense. Whatever sector or industry you look at, the emphasis on sustainability has never been greater, with government legislation, customer behaviour and the expectations of employees, all becoming drivers for businesses to review their processes and procedures.

Public and private sector organisations are increasingly adopting procurement rules that mean suppliers need to demonstrate their commitment to reducing their carbon footprint and protecting the environment. In a recent global survey by Nielsen, 81% of respondents said that it’s extremely or very important that companies implement programs to improve the environment, suggesting businesses that are prepared to put a focus on environmental sustainability are more likely to retain customers and charge more for their products and services.

Just as customers prefer to do business with sustainable companies, employees want to work for them too. Much is made about the changing expectations of the UK workforce in terms of rewards and work-life balance, but research suggests that their employer’s sense of corporate social responsibility – including the strength of their environmental policies – is a key factor for millennials looking for a new job.

Companies can also enjoy direct financial benefits from adopting environmentally-friendly policies, the most significant savings coming in reduced energy and transport costs. So, with all the indicators pointing towards a greater focus on sustainability, why are lots of business owners still reticent to change the status quo and pursue a truly green agenda?

Upfront cost is a factor. Upgrading a company fleet to electric vehicles or moving to an energy efficient building rarely comes cheap, and there will always be departmental budgets or operational expenses competing for the additional investment. Businesses that make a commitment to sustainable practices can also expect other costs to increase – switching to recycled or recyclable paper and packaging, signing up to eco-friendly energy providers and introducing environmental volunteering days or planting trees to offset your carbon footprint are all popular ideas but come at a price.

Management time is another consideration. The options open to small businesses wanting to make themselves more sustainable are truly mind-blowing and just finding time to research the latest developments in areas like renewable energy, transport, IT, waste and recycling can be onerous. The process of changing deep-rooted behaviours of employees within some organisations can itself be a challenging process, often requiring a significant time and effort from management to instigate and follow through the change.

So how should business owners and managers chart their way through the sustainability minefield? Having worked with a wide range of clients to develop and implement business plans, we’ve seen some common themes in successful sustainability programmes;

Take the quick wins – there are lots of basic things that businesses can do to kick-start their sustainability journey with little or no investment involved. Switching off lights and equipment, using energy efficient bulbs or introducing a business-wide recycling scheme are all quick wins that can be implemented relatively quickly and easily but can be effective in building momentum.

Think differently – many businesses talk about developing a sustainable ‘culture’, where adopting eco-friendly practices becomes second nature. This can sometimes be easier said than done but significant change tends to start from the top, so authorising staff to use video conferencing instead of travelling to a meeting, promoting a car-sharing or cycle-to-work schemes and encouraging the use of more sustainable suppliers are all useful ways of leading by example.

Follow the plan – according to a 2018 report from agency 18 Feet & Rising, 88% of UK SMEs value sustainability, but a concerning 70% struggle to make it a reality. Businesses that take the time to develop a costed sustainability plan, with a realistic timeline, are more likely to succeed. Planned investment in ‘big ticket’ items like solar panels or ground source heat pumps can be offset by future energy savings, while key decisions like moving from on-premises IT servers to more sustainable, cloud-based alternatives can be made as part of a wider business strategy.

Celebrate success – as with any development or change process in business, it is important to mark key milestones, acknowledge the efforts that have gone in and the progress that has been made. This means setting SMART objectives and targets that can be measured – and when a business hits its targets then it should shout it from the rooftops!

Seek advice – there are many sources of sustainability advice for businesses, from national bodies like the Carbon Trust and Resource Efficient Wales to general business advisers and specialist environmental consultants. Change programmes need to be led internally, but external advisers can bring a fresh perspective to the issues and challenges involved and can also be helpful in identifying grant funding and advising on sustainability partnerships, initiatives and potential tax savings.

 

This blog originally appeared in the Western Mail on the 12th June 2019.

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