Happy new year everyone, I hope you had a restful and peaceful holiday time.
Sadly, we all know that wasn’t the case for millions of less fortunate people around the world. If the humanitarian crises we are facing aren’t bad enough the impact of geopolitical turmoil, coupled with a year ahead of elections, is conspiring to make the global economy a tough terrain to navigate.
Which brings me to the point of this article.
How do we make the urgent need for greater environmental stewardship relevant to the mass of SMEs and mid corp businesses that power the UK economy?
In the last quarter of 2023 I was fortunate enough to be invited to a number of conferences, meetings, webinars and awards events where one couldn’t fail to be inspired and motivated by some of the actions businesses are taking to change their behaviours and embrace environmental and social sustainability. And I am not just talking about the resource rich corporate organisations in the vanguard of change, but even small agricultural businesses in rural India that are changing the lives of local people through employing regenerative farming models.
However, I do have a nagging concern in my concern in my head. And that is that the passion and drive to change behaviour lies with the intellectual and knowledgeable elite and not with the businesses I refer to above.
Now, let me be clear; I am in no way denigrating those with the time, knowledge and, yes, financial resources, who are passionate advocates of reversing the ravages of climate change. I have nothing but admiration for them and I have been absolutely privileged to have spent time with many of them in the last three years.
But, and here is the worry, I see a huge chasm between the actions and behaviours of the few and those of the many. I have spoken to hundreds of business leaders, particularly those who run organisations in the £5m to £300m turnover range (a big range, I admit but one that has more similarities than differences) and there is a very clear common theme emerging. Whilst 99% of them understand we face an existential threat and they all fear for the world their grandchildren will inherit, there is a disconnect between their business brains and their emotional ones.
Most mid corp board members immediately think that any behaviour change will bring about an “environmental premium” and that the cost will outweigh the returns. To be fair they are also overwhelmed when they stop and think about the crisis we face. They think that their “little” business can’t make a difference and that if governments and policy makers can’t reach a consensus at the annual COP meetings then any actions they take will be akin to pouring a cup of water on a forest fire.
I get that, and to an extent they are right. But I certainly don’t think the increasing numbers of environmental infographics we see on LinkedIn, showing how bad the crisis is, hit the spot either. It’s not that the leaders of these businesses don’t care but they feel powerless and, let’s be honest, surviving Q1 is more important to them than dealing with what many see as a crisis for the future, even when the evidence of it being a clear and present danger is playing out in front of them.
So, what’s the answer?
Well, obviously there isn’t a silver bullet and I am certainly not arrogant enough to suggest that we have the answer but the EBN and Xeed ESG will be presenting an answer throughout the year and beyond. This is to encourage our members and our customers to look in depth at the commercial upside in investing into creating an environmental sustainability and social value strategy.
I am lucky enough to have worked with several businesses that will testify to the benefits this brings to their organisation and if you know of any more out there the EBN will gladly tell their story and help them promote their brand. There are also some patterns emerging.
By far and away the biggest driver of behaviour change comes from the increasing pressure being brought to bear by their big customers. Demands are being made on them to adapt and change their behaviour, to reduce greenhouse gas emissions and to support nature restoration. They come to us to find out how.
Our members and customers tell us that the benefits from implementing such a strategy include adding value to their brand, helping to retain and win customers, persuading the next generation of recruits that theirs is a purposeful business, showing investors and funders (including banks) that they run a forward thinking and risk limiting business and connecting with their communities in a way they have never done before.
It is not free, of course, but it pays to view this as an investment that impacts brand, sales, recruitment, technology, insurance and supply chains. In effect future proofing the business.
I regularly tell people the mantra of the EBN and Xeed ESG is that the climate crisis is the backcloth to our stage but the play itself is about the commercial potential in attempting to reverse the climate crisis. I know many environmental activists who don’t like this approach and would rather we talked about the planet first and foremost, but I believe this resonates more with people who run businesses and, in the end, we all want the same thing.
For environmental sustainability to become mainstream we need the buy-in of the millions of people employed in the medium-sized and micro business sectors. To do that we need to excite the leaders of those businesses about the massive, short term brand differentiation benefits and even cost reductions they can enjoy by embracing a sustainability strategy.
This will be our focus for the months ahead and I would love your feedback and suggestions.
Contact me on 07703 344139 or email me on roger@xeedesg.co.uk
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