According to the US Small Business Administration, small and medium-sized (SMBs) businesses collectively account for 49% of US employment. This group represents not only a large number of employers, but also a massive amount of brainpower and entrepreneurial grit.
Events such as New York’s Climate Week bring together world leaders, multinational corporations and ordinary citizens to discuss our generation’s role in combating climate change. SMBs, however, did not play a role at this important event and are often absent from sustainability discussions. Research shows that this group wants to get involved and welcomes the opportunity to learn more about sustainability. The majority even believe that corporations should be doing more to educate their suppliers on sustainability.
So what’s holding SMBs back? Many don’t have a huge margin to play around with and have an unwillingness to pay more upfront for sustainable initiatives. There’s good news for SMBs. Money is what companies save when they embrace sustainability. This is something that large corporations with sustainability programs already know and can share. There is a strong connection between SMBs knowledge of sustainability and their level of participation. Simply put: the more they know, the more they participate.
Large corporations have an opportunity to educate their SMB customers and suppliers on sustainability – both how it impacts them from an employment and financial standpoint.
Education around Employee Engagement
SMB leaders named cost savings and efficiencies as the top benefits of sustainability, but ranked employee retention and recruitment as low benefits. There is compelling data from employees that contradicts this notion and shows that sustainability makes an impact when they are choosing their employer. Individuals want to work for companies that care about the environment. It’s no longer a “nice to have.” No matter how small or large a company is, employees expect them to be sustainable.
SMBs reported monetary considerations as the biggest barrier to entry, but if you engage employees, their behavior can have a positive impact on the bottom line. Low-hanging fruit such as turning off electronics and printing double-sided can and do add up to make a difference. Sustainability has also been shown to create opportunities for engagement, collaboration and innovation.
Facts about Finance
SMBs are aspirational in wanting to do more, but the reality of today is that they have a hard time justifying investments without being able to see a big impact upfront. That’s where their partners come into the picture. Many large corporations have long-term sustainability investments and employee programs and can share how they started on the sustainability journey and the steps they took to get to the long-term investments. While a good number of SMBs have embraced low-hanging fruit, there are many others who still have the opportunity to do so.
Interestingly, 61% of SMB leaders practice sustainability at home while only 43% reported incorporating eco-friendly practices at the office. Many things that are done at home can also be done in the office, often resulting in cost savings. Two easy things are adjusting the heater thermostat to the lowest comfortable setting when the business is occupied and setting the temperature back further when the business is unoccupied.
SMBs are often a small tenant in a building and don’t think they can make changes. Liberty Power challenged this notion. The company went to its building managers and shared their desire to have more sustainability programs, which led to a recycling program. These programs can lead to significant cost savings by reducing costly trash removal spend.
What’s In It for Me?
Large corporations may ask what’s in it for them to educate SMBs on sustainability. As more and more companies are announcing aggressive sustainability goals, they need their partners’ help to meet them. SMBs are known for their entrepreneurial spirit, which sparks ideas and innovation. SMBs bring a fresh perspective to the sustainability dialog and can offer new ideas about products, packaging and processes. While they may not have a lot of financial capital to invest in sustainability, thinking about operating efficiently is usually top of mind for them. In fact, when asked how sustainability relates to business, SMBs used the following terms: survival, long-term success, efficiency, consistency and growth.
Large corporations can create a sustainability dialog with SMBs by incorporating sustainability into RFPs; encouraging SMBs to participate in and use paperless billing; sharing their sustainability goals and asking SMB partners for ideas on how to meet them; inviting SMB partners to join their employee volunteer projects; and making introductions to other companies implementing sustainability programs.
While these may sound simple, starting the sustainability conversation with SMBs is a win-win. Large corporations can share best practices and SMBs can help bring new ideas to the table. Collectively, we can all make a difference and move the needle on sustainability.
Alex Taylor is executive vice president for Cox Enterprises, a leading communications, media and automotive services company. He oversees Cox Enterprises’ long-term investment strategies, including the Cox Innovation Fund and True North Venture Partners. Cox Enterprises, a $17 billion company, has aggressive goals around carbon, waste and water. Cox has hundreds of thousands of SMB customers and suppliers across its businesses and recently released findings from the inaugural Cox Conserves Sustainability Survey. The survey examined sustainability trends/barriers faced by SMBs. To view the results, visit www.CoxConserves.com/Survey.
