How to create a sustainability action plan for smaller businesses

The move towards sustainability has become an increasingly important issue for smaller businesses regardless of industry sector.

According to research by the British Business Bank, smaller businesses account for around 50% of all UK-business-driven emissions of greenhouse gases (GHGs) – yet the majority (76%) have yet to put in place a decarbonisation strategy.

With the UK legally committed to reducing greenhouse gas emissions to net zero by 2050, smaller businesses are well-placed to become carbon nimble and reduce GHG emissions as part of a wider shift to sustainable business practices and operations.

For a company to be sustainable, it must operate without negatively impacting the environment, such as through GHG emissions or polluting waste disposal.

Sustainable businesses also seek to avoid a negative impact on local communities and wider society, such as through the use of Fair Trade business practices.

Why become a sustainable smaller business?

Along with the positive impact on the environment and society, becoming sustainable could also boost your business and win new customers.

According to a recent survey by Deloitte, 32% of UK consumers are highly engaged with adopting a more sustainable lifestyle, and 28% of consumers reported they had stopped buying certain products due to ethical or environmental concerns.

Green initiatives may also save your company money if they lead to lower energy consumption and resource overheads.

A 2019 study reported that 26% of British workers would be willing to take a pay cut to work for a more environmentally responsible company aligned to their values.

Environmental and sustainable operations can win new customers too and implementing an environmental management system, which controls activities such as waste disposal and energy use, can help smaller businesses qualify for ISO 14001 certification.

This international standard can be required by some government departments and large corporations when responding to a new business tender.

What is a sustainability action plan?

To help your business operate more sustainably, it's a good idea to devise a sustainability action plan.

A sustainability action plan is a strategy for how your company plans to reach targets for achieving environmental, financial, and societal sustainability.

An action plan should look at various factors such as energy use, transport use, and waste disposal. It should set targets and outline the actions the business, its employees, and its suppliers should take to help meet its goals.

Five steps for creating a sustainability action plan

1. Do your sustainability research

Start by understanding sustainability principles, why they matter, and the types of sustainable activities smaller businesses can adopt.

Investigate environmental legislation and compliance standards that may apply to your business and industry.

Talk to key stakeholders, such as employees and customers so together you can identify how your business impacts the environment.

It's a good idea to research sustainable business practices such as insulating premises, installing heat pumps, and switching lighting to LEDs, explore how other sustainable businesses operate, and what processes may apply to smaller businesses.

2. Assess your company's current sustainability

Establish how sustainable your company currently is by examining factors such as energy usage and energy suppliers.

There are useful tools for estimating your company's carbon footprint.

You should consider auditing all major business operations, such as how materials are recycled in workplaces, or how employees travel to work, through to how your business sources raw materials and from what type of supplier.

It may be worth considering getting a professional environmental audit of your business, especially if you wish to apply for certification such as ISO 14001 or apply to be a Certified B Corporation.

3. Set your sustainability goals

Using data from your company's environmental audit, identify the areas you want to improve, and establish clear sustainability goals like replacing disposable kitchen cups with drinking glasses or investing company capital in renewable energy stocks.

A key consideration when assessing a goal's applicability is cost- becoming a completely solar-powered office may be an excellent sustainability target, but could prove outside of most smaller businesses' budgets.

Remember to make your sustainability goals SMART – Specific, Measurable, Achievable, Relevant and Timely.

For example, you could set a goal to reduce energy consumption by 20% across your work premises within 12 months.

By measuring how much energy your business uses today, you can take action – such as replacing inefficient lighting – and measure the reduction in energy consumption.

4. Identify actions for reaching your sustainability goals

Brainstorm actions that could increase your sustainability across all areas of your company.

It can be a good idea to include employees, suppliers, and customers in this discussion as they may have useful suggestions to contribute.

Evaluate the actions in terms of efficacy and applicability, then draw up a shortlist with expected time frames for implementing each item.

An example of this would be replacing paper towels with hand dryers and fitting these appliances in all company toilets within three months.

Once you have established your company's actions, ensure you communicate them effectively with your workforce, as they will be an active part of enacting these changes.

5. Put your sustainability strategy into action

Assign tasks to different colleagues, for example, one team member could source sustainable stationery while another person researches replacing waste bins with centralised recycling units.

Write your new sustainability strategy and goals into company policy as this will help reinforce green behaviour at all organisational levels. Making eco-friendly practices part of the business ethos also ensures your workforce shares a common vision.

To maximise your company's drive towards sustainability you could produce a mission statement that pledges quantifiable results.

This holds your company to greater accountability and motivates you to succeed in your objectives. The final part of implementing your strategy is reviewing its impact, so make sure you monitor and assess your progress.

Reference to any organisation, business and event on this page does not constitute an endorsement or recommendation from the British Business Bank or the UK Government. Whilst we make reasonable efforts to keep the information on this page up to date, we do not guarantee or warrant (implied or otherwise) that it is current, accurate or complete. The information is intended for general information purposes only and does not take into account your personal situation, nor does it constitute legal, financial, tax or other professional advice. You should always consider whether the information is applicable to your particular circumstances and, where appropriate, seek professional or specialist advice or support.

Green Decoder

Featuring a glossary of sustainable terms curated in partnership with the Nottingham Business School, Nottingham Trent University, our green decoder is helping smaller businesses decipher the terminology surrounding decarbonisation.

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