Sustainability in business has been a hot topic over the last few years. As more and more customers search for ethical brands that care for the planet, this is an area that many business owners have been implementing into their operational structure.
Research shows that 90% of UK SMEs value action on climate change and would like to implement a sustainability model into their business. However, a lack of knowledge and funding makes it difficult to get started.
To help with this, the government has partnered with the SME Climate Hub and trusted financial bodies to launch the UK Business Climate Hub, focusing on helping small businesses reduce their carbon emissions and save money on their energy bills.
In this article, we’ll let you know what the UK Business Climate Hub is and how it works. We’ll also explore the business benefits of joining the hub and how it can empower you as an entrepreneur.
What is the UK Business Climate Hub?
Launched in August 2023, the UK Business Climate Hub is a new government scheme designed to help SMEs embrace climate change and incorporate sustainability into their businesses. In return, participating companies receive financial support (like grants and loans) to reduce their energy bills.
The hub is aimed at start-ups that have not yet made any eco-friendly changes, as well as those that have taken some action already, but need help with taking things to the next level.
With a pool of established professionals on board like HSBC, NatWest, National Grid, and the Federation of Small Businesses, the hub is a one-stop shop for a range of tools and educational resources, helping to empower entrepreneurs to take climate action and future-proof their business.
How does the UK Business Climate Hub work?
When you sign up for the UK Business Climate Hub, you join thousands of other businesses and governments in the United Nation’s Race to Zero Campaign, which aims to reach net zero emissions by 2050.
The site offers guidance on a wide range of eco-friendly solutions, such as:
- Switching to low-emission company cars and saving money with electric vehicles (EVs)
- Receiving business grants and other funding solutions to implement sustainable changes
- Generating green energy with wind turbines
- Reducing farming emissions
- Getting low-carbon certifications
To help you get started, the hub takes you through 7 easy steps to implementing sustainability into your business. These are:
- Understand the basics: Everything you need to know about carbon emissions and the benefits of cutting them down.
- Involve your team: How to get your employees engaged in the programme and work together to adopt new behaviours and policies that reduce carbon footprint and energy costs.
- Make the SME Climate Commitment: Committing to the cause and agreeing to report your annual progress.
- Make a plan: How to set realistic carbon reduction targets for your business and stay focused on your goals.
- Take action: Sustainability in practice. Demonstrate your commitment to climate change, building a positive reputation, and attracting new customers and investors.
- Find finance and support: Access support schemes and networks in your area, for help with staying on track to meet your sustainability goals, and financial aid to implement and maintain eco-friendly practices.
- Look beyond your business: Find out how to make a broader impact through other areas such as electric vehicles and transport and recycling.
The site also gives SMEs unlimited access to useful resources to help them stay informed and motivated. They can also connect with participating institutions for educational and financial support, and attend regular events to learn about sustainability and network with other like-minded entrepreneurs.
The business benefits of sustainability
The SME Climate Hub investigated the reasons why some small business owners find it difficult to engage with climate change. The top 5 contributing factors were:
- Don’t have the right skills
- Lack of funds
- Other priorities
- Lack of time
- Customers are not asking for it
The UK Business Climate Hub helps tackle the above barriers. By signing up to the hub and going green, you could:
Attract new customers
If you own a consumer-facing company, committing to sustainability could help you attract and retain new customers.
There’s no doubt that consumer demand for sustainability and ethical brands has skyrocketed.
In fact, an American Express study found that 65% of UK consumers consider the environmental impact before committing to a purchase. A further 63% said that their shopping decisions are influenced by the availability of sustainable delivery options, and 91% said that recyclable packaging is important to them.
With such huge amounts of shoppers basing their spending decisions on sustainability, business-to-consumer (B2C) brands could considerably expand their customer base by adopting eco-friendly practices.
Find new funding opportunities
If your business is in its funding stages, going green with the UK Business Climate Hub could help you find new capital.
Investors want to fund projects that reflect their personal values and support ethical practices. This trend has been rising sharply in recent years, putting an increasing emphasis on environmental, social, and governance (ESG) investing.
A Finder survey found that nearly 57% of UK investors already hold an ethical investment and 77% of current investors are considering ethical investing. On a worldwide scale, Statista research showed that innovation in ESG is the top priority for over 80% of investors. Other priorities include reducing greenhouse gas emissions and responsible supply chain practices.
There is a considerable demand for ethical investing. By committing to climate change action with the UK Business Climate Hub, you could gain a competitive advantage and use your sustainability goals to attract new investors.
Being more environmentally conscious could help protect your business from climate-related disruptions.
If you’re in the food industry, for example, your supply chain is likely to rely on the weather to produce the right crops on the farms that your products come from. However, we’re currently seeing global temperatures reach record highs, which are predicted to keep rising over the next 5 years.
This is a huge worry for many industries and business owners who might face disruptions caused by environmental damage. But you could manage risk and protect yourself by making sustainable changes.
Reduce business costs
Green actions help your company become more efficient and save money in the long run.
One way that you could reduce your operating costs is by upgrading to a compliant vehicle that meets air pollution rules.
The Ultra-Low Emission Zone (ULEZ) in London is one of the most well-known clean air zones that operates a daily charge for non-compliant vehicles, but many other UK cities like Birmingham, Bristol, and Portsmouth have them as well. You could avoid significant fines by investing in compliant business vehicles.
There are plenty of other ways that you can reduce business costs by going green, such as reducing waste, being more energy efficient, and streamlining your manufacturing processes. The UK Business Climate Hub can help you find the right sustainable solution for your company.
If you’re growing your team or are struggling to find the right people, making sustainable changes in your business could help you source new talent and retain staff.
A study by Totaljobs found that 50% of people would turn down an employer with harmful practices, and 26% would be willing to take a pay cut to join a green company. Overall, nearly one-third of UK workers are campaigning for carbon reduction initiatives from their employers.
Making sustainable changes could help you engage staff and attract and retain the right people to grow your company.
Environmental laws are constantly changing. Being more sustainable could help you find new processes, new products, and new ways of working to drive innovation and keep up with legislation and shifts in consumer demand.
Depending on your industry, there are many ways to modernise your business practices. One of the most basic and popular eco-friendly solutions is reducing single-use plastic. Other options could be working with sustainable suppliers or something as simple as switching to low-energy light bulbs.
The UK Business Climate Hub offers an extensive support network to help you identify innovative opportunities within your business, as well as advice on how to implement and maintain them.
Thanks for reading
With so many entrepreneurs lacking the funds and knowledge to build an effective green strategy, the UK Business Climate Hub offers a one-stop shop for financial support and educational guidance on reducing carbon emissions among SMEs.
By signing up to the hub and making eco-friendly changes, business owners can reduce their bills, mitigate business risk, and attract new customers and investors – all while doing their bit for the planet.
We hope this post helped you understand the UK Business Climate Hub and inspired you to sign up. If you have any comments or questions about sustainability in SMEs, please leave a comment below.