New research from NatWest reveals key ways for SMEs to unlock opportunity on the pathway to net zero
• There is a £160bn-plus revenue opportunity for SMEs thanks to the drive to tackle climate change
• With the right support, many SMEs will benefit financially from reducing their carbon footprint
• 30,000 new companies could be created to support the UK’s transition to net zero
• Half the UK’s carbon reduction ambition can be delivered by the country’s SME sector.
In-depth analysis of the UK SME landscape by NatWest has found that small and medium-sized enterprises have the potential to unlock significant revenue opportunity for themselves as well as enable the country to meet its ambitious climate commitments.
SMEs already play a critical role in the UK economy, contributing around 50% of total UK turnover and 60% of employment. Now, the time has come for SMEs to move from the periphery of climate conversations to the centre of the UK’s green ambition.
The Springboard to Sustainable Recovery report says that if the public and private sectors work together to provide relevant support, SMEs could not only drive business value by reducing their own emissions but also unlock growth through wider climate action.
NatWest is pledging £100bn of climate and sustainable funding by 2025 to support the investment the UK needs for a sustainable recovery.*
The power of the small
“Climate change is the biggest single issue facing humanity today,” says Alison Rose, CEO of NatWest.
“We are the only bank to be a principal sponsor of COP26, the United Nations’ climate change conference in 2021. We are using this platform to demonstrate ways for people and businesses to tackle climate change, including, through this new research, exploring the role of SMEs in the UK’s journey to net zero.
“This report sets out a number of concrete actions we, and others, can take to enable SMEs to create real value for themselves, and society as a whole,” says Alison Rose, CEO, NatWest
“We should never underestimate the power of the small (and in this instance SMEs) for leveraging big advances. This report sets out a number of concrete actions we, and others, can take to enable SMEs to create real value for themselves, and society as a whole.”
Unlocking barriers to the SME opportunity
In 2006 Nicholas Stern (now Lord Stern) led what was to become one of the most influential reports on climate change ever produced, The Economics of Climate Change: The Stern Review.
In A Springboard to Sustainable Recovery, he writes: “This report focuses on the practical support SMEs need today to ensure their future success in a rapidly changing economy and society.
“Every government and business should now be focused on the investments and innovation required to reach net-zero emissions as quickly as possible. We know that these investments can drive sustainable improvements in growth, prosperity and living standards around the world. SMEs will be at the centre of the action, being key forces for productivity, jobs and growth.”
Action in six key areas
Financial institutions, government, industry bodies and corporates all have a part to play in breaking down many of the barriers to unlock the SME climate opportunity. These include:
• funding access
• skills and capabilities
• market access
NatWest is committed to helping SMEs to grow and scale through sustainable means.