During the first week of COP26, NatWest gathered over 70 stakeholders in Glasgow to discuss practical steps for small and medium-sized enterprises (SMEs) to tackle climate change and lead the UK's green economic transformation.
The session followed the bank’s ‘springboard to sustainable recovery’ report, which identified a £160 billion growth opportunity for British enterprises tackling climate change alongside the fact that 50 per cent of the country’s carbon reduction ambition can be delivered by the SME sector.
Hosted by HRH The Prince of Wales in his role as head of the sustainable markets initiative (SMI), the event brought together stakeholders from sectors such as technology, beauty and agriculture and provided an opportunity for business leaders to establish commitments that support small businesses to act against climate change.
The NatWest forum identified four crucial ways in which SMEs need support to reduce their climate footprint and to derive growth from climate action. Within each, leaders formed shared ambitions putting SMEs at the heart of the UK’s green recovery. The findings are outlined below.
- The time is now: SMEs know that urgent action is required to transition to a green economy, but many lack the required expertise. Providing the tools to allow them to act immediately, such as being able to accurately report their climate impact will enable businesses to benchmark and improve climate performance, lower their costs, access new markets and command price premiums.
- Unlocking the value: For smaller businesses to embrace the sustainability agenda they need to see it as a strong commercial proposition and a competitive differentiator. Shifting to this mindset requires tailored, sector-specific guidance to help commercialise the opportunities presented by the transition to net zero and a more carbon efficient future.
- Represent and connect: SMEs need greater support from big business if they are to benefit from the green economy. They lack visibility with government, which means they are not able to plan ahead in an evolving regulatory environment. Larger companies can help by amplifying the voice of SMEs and advocating for their needs.
- Engage the youth: In the UK’s push to achieve net zero, young people’s voices are being sidelined. Smaller businesses could benefit from greater engagement with young people as customers, employees, activists and members of their communities. Establishing a genuine dialogue will encourage the sharing of passion, fresh ideas and the building of inclusive, future-focused communities.
To underline NatWest’s commitment to helping the country’s SME sector to address the climate change challenge we all face, it has committed to lending £100 billion in climate and sustainable funding and financing by the end of 2025.
NatWest has also launched specialist accelerators to work towards clean transport and circular economy, tools for businesses to monitor their carbon footprint, and mandatory climate training for all of the bank’s relationship managers in collaboration with the Universities of Cambridge and Edinburgh.