Small Businesses Driving Supply Chain Sustainability Changes

UK small businesses are driving change with 8 in 10 small business leaders treat sustainability as a priority within their supply chain.

New research from Novuna Business Finance shows that UK small businesses are driving ahead with a green agenda and many have already taken steps to be the catalyst for change in the broader supply chain.

Applying Best Practice Into The Supply Chain

The research revealed that more than 8 in 10 small business leaders (82%) now treat sustainability as a priority in the supply chain, driving change with those enterprises they deal with as suppliers or customers.

• 26% of small businesses were particularly interested in the sustainability of materials and said they were moving away from buying non-recyclable or single-use materials with climate negative production processes.

• 22% of respondents now expect businesses they deal with to follow similar standards on carbon neutrality.

• 17% of businesses now assess the green credentials of firms before they decide to business with them. In addition, 15% of respondents said they now insist that their suppliers improve their carbon standards in order to continue doing business with them.

In addition to setting their own standards for their supply chain, a number of small businesses have had to react to the demands of others.

Almost one in five enterprises (18%) acknowledged they had changed their own practices to meet the environmental demands of their customers and suppliers.

Separately, the research found that more than a quarter of businesses (28%) felt frustrated that there were not clearer guidelines from the Government on how supply chains can be greener. This rose to 36% in the manufacturing sector, and 40% a transport and distribution.

Small Businesses Driving Agenda Of Green Action

Sustainability matters more to small businesses than it did a year ago – with 89% saying carbon reduction is important to them. This year, small businesses have been setting out to review energy usage, considering renewable alternatives (26%), looking to have a positive social impact on their immediate community (22%), and switching to greener forms of transport (20%).

In addition, many enterprises have actively contributed to local green initiatives – such as litter picking and community green energy projects (18%).

As a result of these activities, 13% of small businesses already claim to be Net Zero, 31% have a Net Zero plan and target they are working to – and 45% are taking positive steps even though they don’t yet have a formal carbon reduction plan in place.

Broader Community’s Approach To Sustainability

• There are too many businesses that don’t seem to be taking carbon emissions seriously (24%)

• Businesses tend to do their own thing rather than work together (23%)

• There is not enough happening in my community to reduce carbon emissions (22%)

• It’s not clear whether there are initiatives within the community that all businesses can support (21%)

• It is not made a big enough priority by business clubs and networks (17%)

• I know of businesses in my community that are prospering because they have gone green (16%)

• Our business supports community projects that help the environment (16%)

• Our business supports educational and green matters at local schools (15%)

• Not applicable – Carbon emissions do not seem to be a priority in the community (13%)

Joanna Morris, Head of Insight at Novuna Business Finance commented: “It is evident that small businesses are implementing change in their businesses and also insisting on change within their supply chain – whether it be assessing sustainability goals before agreeing to collaborate, or urging those who are current partners to improve their own practices.”

“There is always a focus on the role big businesses can play in driving forward the climate change agenda – but our own data suggests the valiant efforts of smaller enterprises should not be overlooked. Many of them are acting as true change agents in the broader supply chain and their influence may well prove to be far greater than their relative size.”