Almost a third (30%) of smaller businesses globally identify sustainability as one of their top three long-term objectives, according to a survey by HSBC Commercial Banking.
HSBC polled more than 1,400 decision-makers in companies with between 200 and 2,000 employees in 14 countries.
It found firms in Indonesia (43%), UAE/Saudi Arabia (36%) and Australia (34%) were the most likely to be focusing their long-term strategies on sustainability. The sectors most likely to be doing so were mining (42%), utilities (38%) and manufacturing (37%). The UK scored lowest, with only 19% of businesses agreeing.
The survey also found 59% of smaller companies believe sustainable business practices will improve their growth and profitability, with 50% saying consumers are demanding more sustainable products and services.
Companies in the manufacturing sector (72%) and in India (68%), Saudi Arabia (66%) and Canada (66%) were more likely to recognise the commercial benefits of sustainability.
More than a quarter (27%) of firms overall said they were prioritising investment to become more sustainable. However, only 18% said they rated sustainable actions as important to their businesses today, with 46% saying they are important over the next three years.
Almost half (47%) identified finding operational efficiencies in their supply chains as a contributor to their company’s financial performance over the next three years.
HSBC Commercial Banking global head of client coverage Bryan Pascoe said building sustainable practices into strategy had become a “no brainer”.
“[Sustainability] is what customers are demanding, and that’s how businesses will find growth to compete in today’s economy,” he said. “It is positive to see smaller firms are not only aware of sustainability as a potential game-changer, but many are already capitalising on trends and taking action.”
HSBC offers the following tips for smaller businesses looking to embrace sustainability:
- Look for efficiencies in the supply chain that can be both green and cost-effective. For example, solutions that mean that raw materials travel shorter distances can help cut emissions and save transport costs.
- Adapt to customers’ changing preferences by changing your business model. Environmentally conscious consumers may respond well to products sourced and produced in a sustainable way.
- Invest in renewable sources of energy such as wind turbines and solar panels.
- Introduce and enforce codes of conduct and policies on issues such as human rights and relationships with local communities.
- Report on environmental, social and governance (ESG) performance.