How small businesses can be more sustainable

​Sustainability is becoming an increasingly important issue for small companies. Although lots of the conversation around sustainable and ethical business practices focus on large corporates, firms of all sizes have a role to play in tackling climate change.

This need is highlighted by figures from the British Business Bank which show that small firms account for around half of all greenhouse gas emissions by UK businesses, and approximately a third of total UK emissions when households and the public sector are added to the mix.

Sustainability is a commercial issue too. Consumers are increasingly basing purchasing decisions on the environmental and social impact of a business, so being sustainable can mean a sales advantage over your competitors.

Despite all this, many business owners worry that sustainability is expensive. However, there are cost effective ways small businesses can play a part in the UK’s journey to net zero.

Tackle your energy usage

Taking simple steps to reduce your energy usage can make your business more sustainable.

According to the Carbon Trust, lighting uses 20% of the electricity generated in the UK and replacing legacy light sources with LED technology can reduce energy costs by 70%.

Other energy saving steps you can take include:

Reduce waste and use sustainable materials

Tackling the physical materials you use in your business can help to reduce your carbon emissions.

Steps you can take include using biodegradable, compostable or recyclable packaging and marketing materials instead of single use plastic and other environmentally damaging options.

Introducing a recycling scheme as part of your company environmental policies can help to encourage sustainable practices and reduce waste, as can using glass and reusable cups and bottles instead of single use plastic containers.

Other actions you can take to reduce waste include sharing equipment with other businesses or renting it, and there are steps businesses in specific sectors can take. Restaurants, for example, should ensure food portion sizes are monitored to reduce food waste and work with charities to donate leftover food. 

Businesses have legal obligations in this area too.

Bans on some single-use plastic are in place in England and Scotland and Wales, and the Plastic Packaging Tax applies if you have manufactured or imported plastic packaging components which contain less than 30% recycled plastic.

In addition, the extended producer responsibility rules require larger businesses to report their packaging data.

Sustainable transport practices

Adopting greener transport and travelling practices can contribute to improving a business’ sustainability.

Carpooling and lift sharing

Running a workplace carpool scheme can help to cut carbon emissions. Research by BlaBlaCar found that through lift sharing, the number of people travelling increased from an average 1.9 to 3.9 people per car and delivered CO2 savings of 0.9MtCO2, a 26% emissions reduction.

The schemes have the added benefits of cutting transport costs for employees, improving recruitment and retention and helping to create stronger bonds between staff members.

The government has advice on lift sharing here.

Cycle to Work scheme

The government’s Cycle to Work scheme allows employers to loan bikes and cycling equipment to employees as a tax-free benefit. The business also enjoys reduced employers’ National Insurance payments.

As well as helping to reduce general emissions on the road, cycling has been shown to improve health, wellbeing and productivity.

Electric vehicles

Switching to electric vehicles can help to reduce your carbon emissions. They are also generally cheaper to run than non-electrics cars, and there are tax benefits too.

Switch to online meetings

Conducting more meetings online using video conferencing tools such as Zoom, Microsoft Teams and Google Meet means you will cut back on your use of transport. 

Access funding

There are various sources of funding that can help businesses be more sustainable. Examples include:

The Government-backed UK Business Climate Hub has a detailed list of funding opportunities here.

Environmental labels, certifications and accreditation

Using environmental labels, certifications and accreditation can help to improve customer trust and your business’ sustainability. 

Research by the Carbon Trust found that two third of consumers believe labelling on products showing what businesses are doing to tackle carbon emissions is a good idea, with the same proportion more likely to think positively about a brand that can demonstrate it has lowered the carbon footprint of its products.

There are various certification schemes you can use including those offered by the Carbon Trust and ClimatePartner.

Businesses can also become Certified B Corporations, commonly known as B Corps. These are companies that meet high standards of social and environmental performance, transparency and accountability.

The very detailed verification process businesses are required to go through to become a B Corp can help you focus on and improve your business’ sustainability. Once approved, being able to display the B Corp logo can encourage customer trust and more sales.

How TaxAssist Accountants can help

TaxAssist Accountants can help you with the right advice to support your business. While our expertise covers tax, accounting, bookkeeping and payroll, we can also connect you with other providers we work with both locally and nationally.

Give us a call on 0131 665 0771 or contact us to find out more about our services and to book a free video or face-to-face consultation.

Last updated: 20th March 2024