Sustainability agenda ‘missing a trick’ by sidelining SMEs

Small firms have been marginalised in the debate about sustainable business practices and have been slow to adopt environment-related improvements as a result, new research has found.

Despite representing more than 90% of global businesses and accounting, on average, for 50% of gross domestic product, SMEs are lagging behind on the sustainability front.

In the EU, only 29% of SMEs have introduced measures to save energy or raw materials – compared with 46% of large enterprises – and only 4% have a comprehensive energy efficiency system in place.

This is worrying says the Association of Chartered Certified Accountants (ACCA), as collectively small firms have a significant impact on industrial pollution outputs.

In its new policy paper Embedding sustainability in SMEs, ACCA’s Global Forum for SMEs has called on a number of groups including policy makers, regulators and finance professionals to take action to help these enterprises become more efficient and environmentally friendly.

As many SMEs are run by owner-managers with no shareholders or boards to answer to, they often have more freedom to implement sustainability practices – or to ignore them.

SMEs need to be aware of the quick gains they can make through increased efficiency, argues the ACCA.

It points to the availability of support such as grants, financial assistance and incentives that is out there for those firms that commit to cutting emissions or which reduce waste.

It also urges accountancy bodies to become more proactive in the SME sustainability debate, providing members with the right tools and resources to help them develop in this direction.

While becoming more sustainable can open up opportunities to access to large and potentially lucrative public sector supply chains, SMEs will have to adopt reporting mechanisms that can demonstrate accountability in this field.

Here accountants have a valuable role to play by working with local sustainability experts in order to gain local access to credible knowledge so they can review the environmental sustainability of their own business.

Maxine Perella

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