Big business and carbon awareness
Big businesses in the UK and worldwide are finally starting to recognise the importance of carbon awareness and impact. This is a result of both increasingly stringent regulatory requirements such as the Streamlined Energy and Carbon Reporting (SECR) Framework, but also recognising the importance of their sustainability image with customers and employees alike.
This is manifesting in calls from business-to-government to take action on green recovery. In the run-up to COP26 hundreds of businesses are signing up to the Council for Sustainable Business and making net-zero pledges of their own. To read our Net Zero pledge, click here. However, the biggest challenge is how these businesses will fulfil said pledges as they will not only have to decarbonise their own operations but their supply chains too, which a study conducted by Nature claimed the latter to be responsible for ⅕ of global carbon emissions.
Whilst at present the carbon reporting requirements through SECR (Streamlined Energy and Carbon Reporting) only affects the 11,000 largest UK businesses, this scope is growing and SMEs must take stock, as smaller businesses will increasingly be required to report. Added to this is the pressure from larger B2B clients concerned about decarbonising their supply chains, as well as increasing pressure from below as customers increasingly seek sustainability in the way they spend their money; which empowers them to track and understand their procurement carbon footprint through advances around open banking and apps such as CoGo and Vyve.
The Importance of SMEs
SMEs, by definition are those with less than 250 employees and a £45 million annual turnover, and are the backbone of any healthy economy; they drive growth, provide employment opportunities and open new markets. They are a vital source of UK business activity, innovation and employment accounting for 99% of all businesses, as well as generating around half of UK turnover and provide approximately 16 million private sector jobs[1].
Interestingly, SMEs are also responsible for around 50% of emissions in the private sector, much of this being either from their building based operations, out of the 1.8 million SME occupied premises. However, SMEs are often highly focussed on day-to-day operations and highly time constrained meaning issues around sustainability are not always prioritised even if the desire is there.
The driver for change
It is a must that SMEs need to decarbonise, not only because this is socially and ethically plaudible, but increasingly because it’s the commercially positive thing to do to guard revenues in the long term from consumers. A more sustainable business approach is also increasingly looked upon by lenders in a positive light, lending one example, we may one day see sustainability/ carbon ratings affecting our credit scores.
A drive towards sustainability is a win-win for small business, not only is it future proofing its revenue streams by aligning with emerging B2B and B2C customer expectations, but also sustainability usually means cost cutting.
SME Support and the Q Energy Solution
There are two ways businesses can reduce carbon emissions and save money. Firstly, reducing consumption through behavioural change and undertaking energy efficiency investment, and secondly by consuming low carbon energy through procuring electricity more flexibly and thus sustainably. But how can this be done amongst those businesses that struggle to engage with sustainability planning?
A new service developed by Q Energy referred to as The Energy Savers Club, will both empower small businesses to pursue their sustainability and cost saving objectives. The Q Energy dashboard, which is given to all members of The Energy Savers Club, will enable SMEs to both track and understand their sustainability credentials, and to do something about it through a single online portal. SMEs can manage their energy consumption and costs with ease, receive tailored advice on energy efficiency and automatically as well as actively procure sustainable and low cost energy through a dedicated AI driven smart energy tariff.
Our mission is to support the green recovery by supporting UK’s SMEs to grow and create a sustainable future. Pure Leapfrog: the net-zero climate charity and Ask Inclusive Finance: the SME focussed inclusive lender are working in collaboration with Q Energy to develop this new service offering and supply tailored finance solutions to businesses using the service.
[1] FSB – https://www.fsb.org.uk/uk-small-business-statistics.html