How interested are SMEs in Sustainability?

Sustainability and green business practices are topics that provoke much debate amongst larger corporates but how interested are SMEs in this area?
If you asked SME business owners where sustainable business practices sit on their list of business priorities, what level of importance would you expect them to attribute to it?

The Environment Agency states that since the recession, many SMEs have abandoned ‘Green Business Practices’ in an effort to stay afloat.

The Green Business Blog highlights the Environmental Agency’s study of 7,000 companies, which found a 75% drop in those operating “a basic formal environmental management system (EMS)”.  Indeed, over 50% of businesses surveyed claimed that an EMS or environmental policy was of “no use” to them in the current economic climate.

One of the key arguments used to persuade SMEs to move towards more environmentally sustainable business practices is the cost savings that typically come hand in hand with these measures. The above study’s findings suggest that these savings are either not recognised or valued by SMEs, but why is this?

The Carbon Trust claims British businesses waste in excess of £7 million a day and EON estimate the average office wastes £6000 per year through ‘sloppy practices’.

These are sums that are surely significant to smaller businesses, so why are we not taking more notice? It seems to us that ‘greener’ business practices are a win-win for the SME, society and the environment.

So how can we get SMEs to move the ‘Green agenda’ higher up their priority list?

One place to start is with changing company culture. EON argue part of the problem resides in staff attitudes. They found up to 80% of those surveyed did not apply the energy saving practices that they undertake at home, in their workplace.

There are compelling business cases around cost cutting and one should not forget compliance. As the government strives to meet strict EU targets, they will surely look to SMEs to help reduce their waste across their business. Whether they resort to the carrot or stick approach remains to be seen, however, larger energy users are already obliged contribute to the government’s compulsory carbon trading scheme and are open to fines for not presenting valid Energy performance Certificates (EPC) when moving or altering their premises.

Neither should one forget the marketing opportunities that a credible, genuine and meaningful ‘environmental policy’ and ‘Green’ ethos can generate.

Whilst it is important to avoid ‘Green wash’ – superficial ‘green’ actions and communications that merely pay lip service to sustainability and act as a cynical attempt to manipulate customers ‘green’ sensibilities, implementing genuine ‘Green’ and sustainable business practices can give you a means of competitive differentiation.

Allied to that is the increasing body of evidence that shows that consumers are more inclined to ‘trust’ brands that are perceived as practicing sustainable business practices. After Kraft added the Rainforest Alliance logo on its Kenco coffee brand, its market share increased 8%.

We’d argue that implementing sustainable business practices is not only beneficial but necessary for any business to thrive in the future. Incorporating this ethos into your brand and marketing will undoubtedly prove beneficial to your bottom line. But make sure that these measures are consistent across every aspect of your business. Consumers are quick to spot cheap, superficial gimmicks and will not take kindly to your attempts to mislead them.