Why sustainability needs to be demystified in order to be understood and embraced by SMEs
February 26, 2018

The Uprising Report released earlier this month highlighted the response of 100 UK chief executives of small and medium-sized enterprises (SMEs) on approaches to sustainability. Although 88% of respondents claimed to value sustainability, 70% had struggled to embed practices and strategies.

The report also highlighted that eight in 10 SMEs plan to introduce more ethical and sustainable practices within the next five years but that many were struggling to drive progress in the current climate. In particular, 40% thought that sustainable practices were too expensive to implement, with 42% claiming that the UK Government wasn’t doing enough to encourage sustainable business practices. Respondents highlighted high consumer demand for business ethics as a key reason for wanting to implement sustainability measures. However, more than half (53%) of respondents were yet to seek advice for their sustainability strategy.

As an award-winning UK Corporate Responsibility and Sustainability Consultancy, Simply Sustainable has long believed that many SMEs are confused, perhaps at times intimidated by the language and concepts that underpin CRS (Corporate Responsibility and Sustainability) – thinking it is ‘a big business thing’ – when in essence it is about good, ethical business practice, business efficiency and developing and maintaining positive relationships both internally and externally. In many cases, we find that SMEs are already doing a lot or they are well set up to make simple changes that make sense for the business.

So we need to de-mystify sustainability for SMEs, make it less complicated by putting it in their language in order that they can better understand the often straightforward changes and efficiencies that can enhance their business.

This being the case, here are three considerations about what sustainability can mean for an SME:-

1. Play to being a Small-Medium size business – it’s a key USP

It is easier and faster to embed sustainability practice into a SME than into a big brand or company. SMEs tend to have simpler structures and so can implement changes more rapidly. This can range from basic operational efficiencies in areas such as energy, water, transport and waste; deciding carefully what and who to buy from; through to working more closely with large customers (the big brands) to understand and potentially help solve their challenges. The push for sustainable growth cannot be left solely in the hands of a few large and enlightened firms. Smaller firms are crucial to the functioning of any economy – small businesses accounted for 99.3% of all private sector businesses at the start of 2017 and 99.9% were small or medium-sized (SMEs) according to the Department for Business, Innovation & Skills – but they are also ideally placed to step up to the mark on sustainability, understanding that their size is their value – and almost all of it just makes good business sense.

2. Providing a great place to work

Hard on the heels of Point 1, start-ups and SMEs are fast becoming hugely attractive places to work if LinkedIn’s 2016 Work Satisfaction Survey of over 10,000 professionals and over 3,500 employers worldwide is anything to go by, finding that UK SMEs boast the country’s highest levels of job satisfaction, with companies of fewer than 10 employees coming out on top. More and more businesses are beginning to see the correlation between happy, inspired employees and increased profitability. Rather than focus on external factors such as retaining market share, companies can better drive productivity and returns by focusing internally on effective employee engagement and retention. Companies that understand, value and nurture the power of their workforce to further their initiatives will ensure market leadership in the years to come and this is part of what being a sustainable business means. Most SMEs have a natural focus in this area because their success is so reliant on a small pool of valued people.

3. Local and a sense of community work in favour of SMEs

SMEs are often deeply involved in, loyal to and reliant on the local communities where they’re based. They may contribute substantially in terms of providing local employment, be involved in local support structures and they may also rely heavily on business relationships with customers, suppliers and others based in the local area. Again, for this reason, SMEs can oftentimes prove to be naturally more socially conscious than large corporates. In addition to driving economic growth at a local level, such choices around purchasing, employment and a tendency to set up shop in towns and city centres, require less transportation and fringe development. This generally means contributing less to sprawl, congestion, habitat loss, and pollution, all key issues often being addressed by larger companies as part of their sustainability plans but ones which SMEs can fully, and in many cases more easily, make work in their favour.

In many ways then, SMEs are the original sustainable businesses. Close links to customers, employees and suppliers, and the integration of business with family life mean that SMEs are often better than large firms at nurturing relationships, understanding communities and the environment in which they live and work. Sustainability and the legacy of a business are part of an SME’s day-to-day activities, even if they don’t call it “sustainability”.