Drawing on a representative base of 1,200 small businesses in the UK, the British Business Bank’s (BBB) report analyses the progress made so far by small businesses in their net zero transition.
Headline statistics from the report indicate that small businesses currently account for 43 – 53 per cent of all UK business greenhouse emissions, however 76 per cent of small businesses are yet to implement a decarbonisation strategy. This indicates that a large number of small businesses are not building net zero and decarbonisation into their business plans from the beginning. These findings are echoed further on in the report which suggests almost 60 per cent of firms report a reasonable awareness of net zero concepts, but over half (53 per cent) are not yet ready to prioritise decarbonisation.
Net zero makes “financial sense”
As part of the report, surveyed businesses were asked about their top three motivations for net zero. In total, 51 per cent of respondents claimed net zero ambitions made “financial sense” for their business. These organisations saw opportunity to reduce costs and boost sales as a result of decarbonisation strategies and could see the benefits and return on investment of low carbon business solutions such as solar, heat pumps, and energy management.
“Other business benefits”, including staff motivation, innovation, and productivity, accounted for 33 per cent of respondents’ reasoning for pursuing net zero as an organisational goal. Alignment with their business strategy and purpose was also a key motivator, with 48 per cent of respondents citing this reason behind their commitments.
As for the barriers to net zero transitions and fostering green technologies, cost was the most commonly referenced reason accounting for 35 per cent of responses, followed by feasibility (32 per cent), capacity and willingness to act (18 per cent), and information (12 per cent).
Upfront capital costs for net zero action is the principal barrier for businesses looking to decarbonise, with further explanation delving into a lack of appropriate technology and infrastructure available (18 per cent of respondents mentioned this reason). This suggests that the rollout of green technologies is not happening at a fast enough rate to encourage smaller businesses to invest in the technology or build it into their business plans. A lack of information and a knowledge gap surrounding certain technologies is also preventing businesses from pursuing net zero solutions available in the market today.
Alasdair Dalzel-Job, Sustainability and Net Zero Specialist at Green Economy, says “If capex is the barrier there are so many ways to invest in projects without cash in the bank – and when you start to delve into the additional business benefit of investments, such as improved staff comfort, safety and quality, it can really make sense.”
“Investigating where your environmental impacts are can be a daunting prospect. Our advice is to start small with your on-site emissions and work from there into your supply chain both upstream and down.”
Unsure where to start on your net zero journey? Cutting emissions can be as simple as improving energy efficiency. Find out more about effective energy management using our How To Save Energy guide.
Explore the technologies and solutions available to you and demystify net zero using our free online Net Zero Toolkit.