How To Build A More Sustainable Business

Small and medium-sized enterprises are the lifeblood of the global economy, accounting for around 90 percent of all businesses. Yet research shows that many are not as engaged with sustainability issues as they would like.

It’s not hard to understand why sustainability isn’t always at the top of the priority list for SMEs. Particularly during straitened economic times, it can seem like a luxury rather than a necessity. “Right now, many SMEs are focussed on keeping their heads above water,” says Robert King, Head of Commercial Banking Sustainability at HSBC UK. “But there is a strong business case for embracing sustainability.”

Yet there is a strong business case for embracing sustainability. A project by asset management company Arabesque and Oxford’s Smith School of Enterprise and the Environment reviewed 200 studies on sustainability and corporate performance and found a direct correlation between sustainable business practices and financial performance. Reducing energy use cuts expenditure, and sound environmental, social, and governance (ESG) policies are increasingly important when it comes to attracting consumers, investors and new talent.

“Sustainability doesn’t have to be a cost,” agrees Adam Whittaker, CFO of Outright Games, a leading familyfriendly video games publisher. “You can be more profitable and more efficient by being sustainable—and at the same time you’re helping the planet.”

We’re all familiar with the obvious steps in making a business more sustainable, such as switching to a renewable energy supplier or cutting down on business travel, but what else can the Trailblazers teach leaders about having a more positive impact on the world?

Here are some practical strategies to consider…

According to research published by the British Chambers of Commerce, only one in ten SMEs in the UK currently measures their carbon emissions. But, as the maxim goes, if you can’t measure it, you can’t manage it. There are free basic online calculators, such as those offered by The Carbon Trust, that will let you get a handle on the shape and size of your carbon footprint. But for something more sophisticated, you can invest in paid-for carbon accounting platforms from companies such as Normative or Greenly. And the results may well surprise you.

“Without measurement, I would have assumed that switching all our energy usage to renewables would have made a big difference, but that actually turned out to be less than one percent of our overall footprint on the planet,” says Whittaker. “What makes the most impact is our actual physical product. We’ve reduced our carbon emissions in the last year by 15 percent just by making some fairly simple changes in our supply chain, such as bundling more products into each delivery, which means fewer transport links. By measuring and knowing where your footprint is, you’re able to make choices in the right areas.”

If you’re committed to making a positive change, then checking the sustainability claims of suppliers is also vital. “Choosing the right partners is really important,” says Sharon Chan, Co-Founder and COO at Sourceful, a company offering sustainable packaging solutions. “A lot of companies talk about sustainability for the sake of selling their products, and sometimes they make false claims. You have to dive deep.”

Sourceful uses paper with a Forest Stewardship Council certification, to ensure it comes from responsible sources, and uses recycled plastic certified by the Global Recycled Standard. It’s also partnering with ReCon2, a not-for-profit University of Manchester spin-off that has developed technology for quantifying the amount of recycled content in plastic products and packaging. “We’re very excited to see what it brings up in the future,” says Chan. “It’s all part of constantly trying to improve visibility in terms of the materials we use.”

Hybrid working clearly has a positive impact in terms of reduced commuting emissions, but that’s no reason to be complacent. “We’re a relatively small company with around 150 employees working in a hybrid way, but even so, our total commute adds up to around half a million kilometres a year,” says Whittaker. “That’s the equivalent of one person driving from London to Kyiv every day.”

It’s also worth checking how much your employees may be contributing to your carbon footprint when they’re working at home. As part of its measurement, Outright Games asks not just how far and how many days workers commute but also whether they use renewable energy domestically. That can help get a picture of the environmentally optimal way of working.

“Our Madrid office is very energy efficient and uses one hundred per cent renewable energy, and most people take public transport,” says Whittaker. “In that case, bringing people into the office probably has a lower overall impact than keeping them at home.”

At local sharing app Olio, which has a fully remote workforce, all employees are issued with the company’s ‘green (home) office policy’, which offers advice on reducing carbon emissions domestically. This includes topics such as not only switching to a renewable energy supplier, but also wearing warm clothing in winter to avoid using excess heating, and considering a more ecological diet.

There are plenty of ways to cut down the energy consumed by PCs and laptops: judicious use of the sleep mode can result in significant reductions, for example. But these savings should be seen in the context of a computer’s lifetime use of energy. According to research by the United Nations University, 81 percent of the energy consumed by a computer is expended during its construction. In other words, it takes far more energy to build a computer than it does to run it.

At the end of their useful life, computers ultimately end up either in landfill, where they can leach poisonous substances into the ground, or in e-waste recycling centres that often simply export the problem to countries such as China and India.

Olio therefore supplies refurbished laptops to employees with basic computing needs. It’s a strategy that not only extends the life of the device but is more cost-effective than buying new equipment.

The company also recently rebuilt its website for sustainability reasons. The internet as a whole uses considerable amounts of energy—a large data centre, for example, consumes as much as a mid-sized town. However, by making changes to the content of a website and its technical functions, meaningful energy savings can be made. These changes can include improving both SEO and user experience, so a user’s journey is as efficient as possible, and thinking carefully about the use of data-intensive content such as images and video. (For an exhaustive list of website sustainability improvements, German online marketing agency Svaerm’s guide is hard to beat.)

“We set our website up ourselves eight years ago when we were just starting out, and our users would regularly flag to us that it was just not fit for purpose for a company that puts sustainability at the heart of its mission,” says Olio Co-Founder and COO, Saasha Celestial-One. “We made a big investment to completely rebuild it, and it’s now best-in-class from a carbon perspective. And hopefully it will pay for itself because it’s more efficient.”

There are external bodies that will certify corporations for their sustainability credentials. One of these is the B Corp mark , which covers every aspect of a company’s environmental and social impact. Not every company will be able to meet its requirements, but the list of criteria can function as a ready reckoner of how well you’re doing.

“It’s a really good place to get started,” says Celestial-One. “Even if you don’t want to go the whole way, you can still do a lot of the things that the certification requires. There’s a very long list that can help you assess which ones are right for you and also achievable.”

Olio has itself achieved B Corp certification, but even so, the company believes it is still not perfect.

“Often it’s a trade-off,” she says. “We believe it’s better to get 80 percent of it right, and if you need to park the other things because you can’t afford them or you don’t have the resources to prioritise them, that’s okay.”

Often the trade-offs depend on the size and stage of a business. When Olio started, it was self-funded and growth depended on handing out flyers on street corners. At the time, the cost of using recycled flyers was prohibitive. “We’re talking about thousands of fliers, but we were okay with it,” says Celestial-One. “We realised that at that point in time it was more important to get people to sign up to the app and to get them to start sharing.”

“There’s no such thing as absolute sustainability,” agrees Sourceful’s Sharon Chan. “You have to find what works for you and what can be actioned as a business—and just try to improve every day.”