What does a Green City Region mean to SMEs, and why should they care?
26 October 2020
Speaking at Greater Manchester’s fantastic 2020 Green Summit, our team of specialist environmental business advisors discussed what the city region’s ambitions mean for SMEs.
The 2020 Green Summit in September saw a host of expert speakers and insightful presentations take place online over four days, providing an update on Greater Manchester’s progress in shifting to a sustainable, zero-carbon economy.
Our advisors Claire Scott, Alasdair Dalzel-Job, Rebecca Chedd and Paul Cooper joined the Growth Company’s director of low carbon, Todd Holden, in a panel discussion on day three chaired by the FSB’s development manager for Greater Manchester, Robert Downes. With over 100 years’ professional experience between them, the panel gave an overview of what the transition to a net-zero economy means for smaller businesses. Here’s what they had to say.
What are the biggest challenges for businesses?
Todd Holden: “We’re going to see some massive issues around how we heat our buildings and industry. A lot of it will be electrified, and there will potentially be some use of hydrogen, but what there won’t be is natural gas, and we can see that in early policy announcements. Although energy prices are quite low at the moment because of overall demand, that’s a false horizon – energy prices are going to rise, particularly gas prices.”
“Transport will be a key issue. We’ve seen huge improvements in air quality over the last six months but it’s unlikely those improvements will be retained unless we can get people back onto public transport, so a Clean Air Zone in two or three years’ time is very likely.
“We’re also going to see issues in terms of supply chains. There will be more focus in companies understanding their supply chains, greening their supply chains and probably shortening supply chains as well. So we’re going to see pressure coming down from larger companies.”
What do you think the level of awareness is amongst businesses around these issues?
Claire Scott: “The level of awareness varies massively. There are some SMEs who are very switched on already and very committed to reducing their carbon emissions. Some are already aiming to reduce carbon emissions to net-zero in the next few years, and others have also extended the remit beyond their direct emissions and are redesigning their products and their services. That early action is putting them in a really strong position with both consumers and procurement professionals, who are starting to put sustainability at the forefront of their decision making.
“But there are others who are perhaps less aware of the bigger picture in terms of the policy landscape and the challenges over the next few years. They’re at the earlier stages of the journey; they’re starting to look at energy efficiency and making cost savings, but perhaps don’t realise how big an impact wider policies will have on their business. There’s a lot more to be done to engage in the wider business community to ensure that everyone is aware of the potential challenges ahead.”
For a business that hasn’t embarked upon that journey yet, what’s the first step?
Alasdair Dalzel-Job: “It’s about understanding where you are now – so setting a baseline and potentially benchmarking that against competitors or those in your industry you aspire to be like. But to do that you need many different layers. One of these is management buy-in, because without that you’re set to fail. Another is staff engagement and awareness – if you gain their commitment and their trust in this journey, they may well come up with some brilliant plans to help you.
“You don’t need to jump in and immediately go for the big projects like solar panels on the roof. Make small changes, and then reinvest the money you save in a slightly bigger project, and then reinvest those savings in another one. It’s a continual process.”
Rebecca Chedd: “Speak to your staff. Ask them what they think the biggest issues are and ask them for ideas on how to improve. You could set up a staff suggestion box to get their feedback, or you could even ask for volunteers to become ‘eco champions’ so they can really take the lead.
“On a practical level though, a good place to start is to really understand your current consumption of energy, fuel, materials. Take a look at your energy bills and understand how much money you’re spending. Then you can start to investigate where the big energy users are.”
What are the key lessons for businesses who want to get started?
Claire Scott: “What’s really important to truly make change is a shift in culture. There needs to be management commitment from the most senior level, and it can’t just be one person’s responsibility. True change won’t happen in isolation; it needs to draw from the entire organisation.
“It doesn’t need to be onerous or difficult; you just need to get into the habit of considering this as an issue when you’re making all business decisions. It doesn’t matter whether it’s a small commercial business or a large factory, engendering a cultural change so that the environmental impact is factored in when making any decision is a really important shift.”
When you speak to small businesses about going green, often the first response is: what is it going to cost me?
Paul Cooper: “Energy efficiency makes good business sense. It can be financed out of the savings made or by implementing no-cost measures. At the Business Growth Hub, we also provide Energy Efficiency Grants to small businesses to take some of the risks away.
“The other important thing is to have confidence. Confidence comes from having people around you that have experience – this is where advisors from the Business Growth Hub come in. We can sit alongside clients who are not used to delving into these areas, allowing them to sleep more soundly in the knowledge that they’ve had expert help that’s completely independent.”
Alasdair Dalzel-Job: “Every week we see a new grant application for LED lighting, which is typically well below a two-year payback – that return on investment is very attractive. A new motor can pay back in a matter of weeks. There are multiple small low or no-cost projects that can make an instant difference and make your money back very quickly.”
What are the other benefits for businesses going down the net-zero route?
Rebecca Chedd: “There are lots of benefits; it’s not just about cost savings. One of the big benefits is around company reputation. If you’re looking at your environmental impact and taking action, that can raise your company profile and help your sales and marketing teams to win new work and impress your customers.
“It can also help with staff morale and productivity. If employees know they’re working for a company that really cares about environmental issues and has strong moral standards, they’re going to be happier working there. Similarly, it can help with attracting and retaining talent within the organisation. We’re seeing increasingly that people are choosing to work at organisations that have a strong environmental ethos.
“If you’re on top of environmental impacts and have got your house in order, that can help reduce compliance risks as well, so you’re less at risk of failing with environmental regulations.”
Our resource efficiency advisors provide a range of services to help Greater Manchester SMEs on the path to net zero; from on-site audits to identify opportunities right through to supporting implementation via our Energy Efficiency Grant.