Millions of micro-business owners do not believe they can have a positive impact on the UK’s targets for a net-zero economy, according to research published on 1 August by Start Up Loans, part of the British Business Bank.
The UK has an estimated 5.3 million* micro-businesses, which is defined as any business with between 0-9 employees, including many thousands of start-ups. The research found half of business owners would value information that would help them assess whether reducing their carbon footprint would make financial sense for their business.
The survey of micro-business owners appeared to find:
- 40% (2.1 million) don’t believe reducing their own emissions will make a difference
- 50% (2.7 million) find the language, terminology and information around sustainability inaccessible, 78% don’t fully understand the term net-zero and 72% don’t fully understand the term carbon neutral
- 67% (3.5 million) have never sought information on how to reduce their carbon footprint and 46% (2.4 million) don’t know where to go for information
- 50% (2.65 million) would value information to help them assess whether reducing carbon impact would make financial sense for their business
The British Business Bank’s #GreenToGrow campaign aims to demystify and alert smaller businesses to the commercial benefits of investing in decarbonisation. This includes a host of free online resources include the ‘Green Decoder’, an online guide co-created with Nottingham Business School, Nottingham Trent University to help smaller businesses decipher the terminology surrounding decarbonisation.
Consumers want greener businesses
Other research suggests that it makes economic sense for micro-businesses to consider reducing their carbon footprint. A separate independent survey published by Hearts & Science found, for example, that half (52%) of consumers now take a brand’s eco-credentials into consideration when choosing products, and one in five (21%) have made the decision to stop buying from brands because of their environmental impact.
Below, Start Up Loans recipients and micro-business owners discuss the challenges they face in their efforts to implement and highlight their green credentials:
Jeroo Doodhmal, Founder of Pip and Henry, a sustainable children’s shoe company, said:
“Our mission is to help children take their first steps into the world more mindfully. While we create sustainable products, we do have an international supply chain which results in a greater carbon footprint than if we were entirely UK-based. Because a lot of our sustainable materials such as pineapple leaves and coconut fibres are sourced abroad, that’s likely to be an ongoing challenge.”
“There is a lot of energy and ambition among small business owners to make their operations sustainable and net-zero, but I think it’s fair to say that in practice it’s more complicated to implement both at the same time without consistent support and access to the right information.”
Ben Caspary, Founder of Booheads, a manufacturer of bamboo electric toothbrush heads, said:
“I created Booheads in November 2020 to bring sustainably sourced, biodegradable bamboo toothbrush heads to customers seeking an alternative to the disposable plastic versions that end up in landfills. Creating sustainable products and growing a sustainable business are very different things, but the key to achieving both is applying a thoughtful, long-term view to your decision making.
“Supply chain and production costs are make or break for small businesses, and the associated carbon footprint is often beyond an owners control. As an e-commerce business I can’t control whether our courier partners use fleets of low carbon or electric vehicles, for example. Needless to say if they did then that would be welcomed, but what matters to me managing the growth of Booheads is that our customers receive orders on time and at a cost that keeps us on an upward trajectory.”
Kate Barnard, Founder of Enjoy the Air, which provides data on air quality said:
“I founded Enjoy The Air in the height of the pandemic, December 2020, to primarily address outside air quality as it links to 10 of the 17 UN’s Sustainable Development Goals. We support cities by providing data and analytics, specifically in the areas of air quality and mobility.”
“When you’re starting a business for the first time you’re learning everything at once. You need guidance to make the right long-term decisions and to choose the options that enable you to grow ever greener. The first step we need to take as a business community is accepting that for as long as people are presented with bad options and inconsistent guidance, we can’t hold them solely accountable for their decisions.”
Richard Bearman, Managing Director of Start-Up Loans, said: “The UK’s start up and micro-business community has enormous potential to contribute towards our national net-zero agenda and it’s clear that there is a job to be done in helping many to understand how important they are to that crucial process. This is especially true amid a backdrop of continued economic turbulence and rising operational costs, which is putting unprecedented pressure on smaller businesses.
“However, it’s more important than ever for consumers to see the companies they buy from taking positive steps towards the climate crisis, even if they’re not able to be completely carbon neutral. That’s why we launched our #GreenToGrow campaign earlier in 2022; to provide a platform via which any business can access helpful, de-jargoned information that explains the terminology around net-zero, as well as how to take steps to convey to their customers that they are taking positive action.
*Number of conversions based on number of UK micro-businesses being 5.3 million, taken data from House of Commons Library published 21 December 2021: https://researchbriefings.files.parliament.uk/documents/SN06152/SN06152.pdf