Special Feature
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A Net Zero future? Our role in averting a climate catastrophe Keith Softly Head of Commercial Banking Intermediaries Lloyds Bank
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MEs will be essential in the UK’s transition to Net Zero carbon emissions, and they are keen to play their part. But they need more help.
The Government target of reaching Net Zero carbon emissions by 2050 is one of the biggest challenges faced by businesses in a generation. Firms will need to examine every aspect of their operations from supply chains to property energy efficiency and their use of transport, to play their part in reaching the target. To better understand the scale of the challenge faced by SMEs, Lloyds Bank surveyed more than 1,000 SME leaders across the UK and held several in-depth interviews with sustainability experts and businesses to hear their hopes and concerns. The findings in our special report From Now to Net Zero: A Practical Guide for SMEs, are uplifting, but also highlight the difficulties and frustrations felt by many firms. SMEs are eager to play a part in the road to sustainability. Most (74%) are aware of the Net Zero target and an even greater proportion (89%) see sustainability as important to their business. But unfortunately, 40% of businesses said they did not know what Net Zero would mean for their business in practice. Factors motivating SMEs to make changes ranged from cultural 30 | NACFB
change and shifts in public opinion, to regulation, commercial opportunity, and the need to attract and retain employees. A journey to Net Zero can create new opportunities to thrive and grow and increasingly change will come from within, as employees at all levels increasingly expect and deliver action on sustainability. Talking to SMEs revealed three principal areas where they faced a challenge around sustainability. • Financial barriers – Finding the capital to invest in sustainability initiatives and uncertainty about whether such investment would deliver real returns. • Limited control – How can they act to reduce emissions outside their own direct operations – for example in supply chains? • Assessing their environmental impact – This remains logistically difficult and quite complex.
Key stages on the journey to Net Zero From getting started, to being a net hero, these key stages reflect the day-to-day experiences of firms on a sustainability journey. Having a clear understanding of the stage they are at, will help businesses of any size to consider what next? And to move along their sustainability journey.
1 . Getting started These businesses recognise the benefits of sustainability to their commercial success and preparing for the future but are also facing barriers to action – most likely around knowledge, control, finance, and time.
