Summer 2023 saw climate change hit the headlines as many locations experienced extreme weather. In fact, climate change is rarely out of the news.
The big picture
In March, the UN released a major climate change report which drew on six key research pieces completed over the past five years. The result was that it strongly urged countries to bring forward their net zero targets given the earth’s rising temperatures.
For the unsure, net zero means a country, region, or even an organisation no longer adds to the total amount of greenhouse gases in the atmosphere. This is typically achieved by reducing emissions or offsetting them by – for example – planting trees or restoring peatlands.
The UK had committed to becoming a net zero economy by 2050. Recently though, there was much debate about whether it will hit that target in time. The UK isn’t the only nation struggling. At the end of November, COP28 takes place in the United Arab Emirates. There are, however, reports that various agreed global environmental targets are in line to be missed.
At a local level
There can be a sense of powerlessness when looking at the big picture, yet significant positive change often comes from small steps.
Despite dealing with a challenging economy and rising costs, a recent Novuna Business Finance study found that 85% of small and medium-sized Businesses are putting green issues higher up their business agenda.
A Federation of Small Businesses survey also found that while many businesses try to lessen their environmental impact, they need help to finance the necessary changes.
In our September Club session, we explored what small and medium-sized businesses (SMBs) can do to be more sustainable in the tough economy.
Simple steps
Club Members discussed SMB sustainability in these critical areas:
- Energy consumption
- Waste
- Vehicles, distribution and logistics
- Water
- Supply chains
Also, what steps could SMBs take to motivate employees and customers to help that business become more environmentally friendly? Suggestions included…
Your staff need to be involved
To become more sustainable, a business must get staff involved and on board first. Most employees are keen to work in a more environmentally friendly environment, and with their support, it is easier to change approaches in the organisation’s operations.
Measure first, then change
Before introducing any measures to reduce consumption (eg, energy, water), it is essential to assess the current levels and understand what contributes to them. Conducting an audit at the start will enable you to set a benchmark for future improvements. This will highlight specific areas the business can then focus on in its operations.
Energy-reduction ideas
Many Club members agreed that a lot of office-centric energy consumption lies in lighting, heating and cooling systems. Now more businesses have switched to agile working, it’s wise to assess when these energy-drainers are needed and not needed in the working week.
Temperature settings can be reduced using smart technology, and lights changed to LED bulbs or motion sensor models. Another quick win to reduce consumption (and save money) is to turn off appliances at the end of the working day and not leave them on standby overnight.
It’s worth remembering that companies can claim 100% tax relief on the cost of energy-efficient technology and equipment, like solar panels and heat pumps, through the Enhanced Capital Allowance scheme.
Wising up to waste
While many businesses endeavour to recycle more and reduce paper consumption, there are other areas of waste to explore.
Club members discussed waste from a technology and equipment perspective and how, when purchasing equipment, it helps to be clear of its efficiency, life expectancy, and the materials used within it. Some businesses whose operations generate food waste are exploring ways of recycling it into biofuels.
Vehicles and distribution
More businesses are switching to electric vehicles, and tax incentives exist to do so. Pure electric vehicles qualify for a 100% first year capital allowance until April 2025 and a company benefit rate of just 2% (again until April 2025).
Some businesses have also promoted car sharing to minimise the volume of staff journeys, while others are moving more meetings online to reduce travel. The cycle-to-work salary sacrifice scheme is proving popular, particularly since the Government removed the cap on the value of bicycles and electric bicycles purchased through the scheme.
With distribution, some businesses are rethinking their logistics journey. For example, some IT providers now ship equipment directly from the manufacturer to the client and then do remote set-up sessions to install it on the client’s site. This helps to reduce additional journeys in the installation process.
Watching water consumption
There have been significant advances in technology and equipment to reduce water consumption. Updating old plumbing fixtures and dripping taps can help businesses avoid losing up to 20 gallons of water a day. Replacing taps with spray taps, and moving over to duel-flush toilets can save thousands of litres a year and help businesses save money.
Sustainable supply chains
More large businesses and public sector organisations favour eco-friendly suppliers and are asking their providers to disclose their environmental credentials. SMBs should expect to be asked about their own carbon footprint and that of their suppliers. Club members recommended initiating discussions with suppliers and opting for those with better environmental qualities.
It also helps if businesses consider the sustainability of the products they buy. In doing so, check that the products use few natural resources, have a longer lifespan, consume less energy or water in production or when used, and can be reused or recycled at the end of their life.
Gaining the support of employees and clients
More businesses and prospective employees are favouring those organisations that are environmentally friendly. Sustainability, however, should be a genuine business commitment and part of the organisation’s proposition and values. Consulting with employees and clients about the organisation’s sustainable goals and ambitions allows a business to gain support and decide on the achievable priorities in the short, mid and long term.
Other helpful resources
While businesses often regard sustainability as a hefty financial investment, it’s important to remember that reducing energy, water and waste can bring helpful cost-savings. SMBs looking for funding can often find better interest rates for sustainable investment.
There are numerous standards and frameworks which businesses can gain to support their carbon footprint reduction. These include ISO 14001: 2015, ISO 4001: 2018, PAS 2060: 2014, and the ISO 14060 family. Organisations like the Federation of Small Businesses, the Institute of Directors and the CBI have helpful resources. Do also speak to specialists in improving environmental management systems or carbon reduction.
Summary
While the speed and scope of global warming are alarming, there are simple and positive steps being taken by individuals, businesses and organisations to lessen environmental harm. These little steps make a significant and positive difference.
Thank you to all the Club members who joined us at our September event and shared their ideas. If you would like to attend our future Business Club events, please get in touch with the Shipleys’ Godalming team for more information.
Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary.
Copyright © Shipleys LLP 2023
Related Resources
Is the talent war over?
Liberate your time!
The evolution of employment
The impact of pressure
Getting your business financially fit!
