How can owner managers foster and fund sustainability in their business?

When it comes to sustainability, business owners are facing more pressure than ever. Customers are looking for more eco-friendly products and services. And employees (current and prospective) are looking for responsible management.

We’ve seen it first hand when speaking to the businesses we’re working with, and we’ve seen the numbers to back it up too. Recent research shows that sustainability is one of the top listed issues that organisations are facing this year.

But becoming a truly sustainable business requires time, investment and often, innovation. All of which can seem daunting in today’s economic climate.

So where do you begin?

Assess your current sustainability practices and policies

Like any new project, knowing where you are now, where you want to be and what you want to achieve is key to implementing a successful sustainability strategy within your business.

Whether you’re starting from the ground up or have long-standing policies in place, knowing how your sustainability strategy and practices shape up, and what your goals are will give you a structure and direction of travel.

That’s why conducting a sustainability audit can prove extremely valuable.

Conducting a sustainability audit

Whether it’s a fully-fledged deep dive into your current sustainability practices, or you’re honing in on one area, an audit is a great jumping off point. It may be a pleasant surprise to find that you’re doing a lot already that your team may not have been aware of, or it may give you pointers on areas for improvement.

You may want to look at your wastage, energy usage, efficiency of your utilities or even sustainability awareness amongst your team. But in the longer term, everything from your electricity and fuel consumption, to your supply chain, can and should be analysed. This will help to highlight where your strengths and weaknesses lie.

There are plenty of third parties out there offering sustainability audits, so make sure you do your research and find a supplier who truly understands you as a business before diving in with your audit.

The right supplier should be able to evaluate where you currently stand and make meaningful recommendations for your business, giving you a really strong starting point to develop a clear sustainability plan. This will go a long way when it comes to getting buy in from stakeholders, especially your team.

Getting your team on board with the race to net zero

A water-tight strategy and effective communication

In order to have a water-tight sustainability strategy, you need to make sure you have implemented your policies and procedures across all aspects of your business. From your leadership and management team, right through to your trainees and new starters. So, it’s crucial that every member of your team is in the know, and bought in.

This can be easier said than done. Clear, concise and transparent communication of how your sustainability mission will fit into individuals’ day-to-day roles, and what is expected of your team, is vital.

It’s inevitable that some people in your team will feel more passionate about sustainability than others. So being able to paint a clear picture of what the aim is and what the overall benefit will be, could give you a real helping hand on getting everyone’s buy in.

It’s also worth considering environmental training for your team, and even if your benefits in kind could help you here. Bike to work schemes, or offering electric vehicles as part of your company car policy can increase engagement and help you on your journey to net zero too.

Striving for best practice

Once you know where your strengths and weaknesses lie, you’ve implemented and communicated your strategy, it might be time to consider an accolade. Recognition from a third party such as B-Corp or CSR-A can really help communicate your business’s success.

It’s worth noting, your end goal should never be to receive recognition for your efforts. In doing so, you will run the risk of greenwashing, which could cause reputational damage.

Instead, you should use the feedback from off the back of an accolade to keep improving. Any recognition that comes alongside this will be a bonus for your business.

Funding your sustainability efforts

It’s great to see that 75 percent of businesses have upped their sustainability investments in the last year. But in the current economic climate, it can be daunting for owner managers to plough money into sustainability. Especially when it can result in a cashflow hit in the short term.

Thankfully, there are a number of support measures, which could potentially support you on your sustainability journey.

Tax incentives and reliefs

Embedding sustainable processes and practices and creating new environmentally-friendly products requires innovation. If you are working on projects which contribute towards your business’s or the UK’s aim to reach net zero, you could be eligible for research and development tax relief.

Or even if your products aren’t viable anymore because of regulatory changes or environmental pressures, and you’re looking to improve or replace them, this could be deemed as a qualifying activity too.

The rate of relief stands at 86% for qualifying SMEs. But with huge changes on the horizon, make sure you speak to a qualified tax expert before submitting your claim.

Capital allowances

Solar panels, boilers and energy efficient technology. If you’re investing in new plant and machinery as part of your sustainability plans, you could qualify for capital allowances.

The rate of relief stretches up to 100% of expenditure, depending on the expenditure in question. Much like R&D tax relief, capital allowances have highly complex rules. So, we would recommend that you speak to an expert in capital allowances before claiming.

Grant funding opportunities 

The UK Government have nearly £5bn allocated to help businesses become more sustainable.

If your business is investing in technology to increase efficiency and/or reduce carbon emissions as part of your sustainability strategy, you could be awarded funding. Opportunities are constantly cropping up, so it’s worth keeping up to date with the government’s website to see what is on offer and assess whether you qualify.

If you’re looking into your funding options, we would really encourage you to get in touch with your advisors. Specific rules around qualifying for funding and relief, mixed with today’s ever-changing tax landscape, require the eyes of an expert to ensure that you maximise the opportunities available to you, whilst staying compliant.

Supporting you on your sustainability journey

As you’re working towards your sustainability goals inevitable challenges will crop up, whether it’s getting buy-in or securing funding.

Our team of experts are working with hundreds of businesses who are currently reflecting on their sustainable policies, advising them on the best tax reliefs and funding on offer.

Whether you need advice or a sounding board for your business’ policies, our team of qualified advisors are here to support you.