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Most SMEs believes there are financial opportunities in the move to a greener economy



The majority of small and medium-sized businesses believe there are financial opportunities in the shift to a greener economy and that they personally can benefit from them.

That is the key finding of UK-wide Opinium polling commissioned for a new report by The Entrepreneurs Network and the Enterprise Trust.

The report is published on the day that United Nations climate change summit Cop26 was scheduled to begin in Glasgow – it has been postponed until next year.

The findings from the report, Green Entrepreneurship , challenge the historic assumption that pursuing sustainability is a hindrance to businesses and the economy.

It argues that harnessing the innovative products, ideas, and practices devised by Britain’s flourishing entrepreneurial ecosystem will be critical to overcoming the environmental challenges facing the planet, while also providing an economic boost and positioning the UK at the forefront of the green growth sectors of the near future.

The survey says that businesses already have commercial as well as ethical incentives to ‘go green’. Entrepreneurs report that consumers and potential employees are seeking out green businesses.

Half of all businesses agreed that their customers expected them to take steps to be more environmentally responsible and 57% agree that employees increasingly want to work in businesses that are seen as environmentally responsible.

SMEs are acting on this information: more than half (54%) have taken steps to become more environmentally friendly over the past few years, though nearly half (47%) believe they could be doing more.

However, consumer and employee pressure alone will not be sufficient to meet major environmental challenges.

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The report argues that environmental problems are driven by market failures, where governments have not sufficiently made polluters bear responsibility for the full costs of their actions, nor sufficiently rewarded those who develop solutions to environmental challenges.

Businesses are split on how well they think the government is doing in terms of helping them to profit by addressing environmental problems – most (38%) think it is doing neither well or badly, while slightly more think it is doing badly (30%) than well (24%).

Meanwhile, equity investment is flowing into green businesses. Data from Beauhurst reveals that between 2015 and 2019 equity investment into startups described as ‘sustainable’ has more than trebled (204%), while ‘environmental’ businesses saw a 94% increase in equity raised.

Green Entrepreneurship showcases the entrepreneurs who are driving the sustainability revolution. They include Electron co-founder Jo-Jo Hubbard, whose platform makes it easier to manage demand for intermittent renewables such as wind and solar, and Too Good To Go co-founder Jamie Crummie whose business works with restaurants, cafes, and retailers to reduce food waste.

The report identifies 20 practical recommendations for the government to offer new incentives for entrepreneurs to create green products and for consumers to switch from polluting or unsustainable products whilst boosting the economy.

These include:

  • Making the Annual Investment Allowance unlimited to encourage businesses to invest in as environmentally efficient equipment as possible.
  • Fixing Energy Performance Certificates (EPCs) so they don’t discourage consumers switching to Heat Pumps.
  • Use COP26, which would have taken place this week, as a chance to showcase British entrepreneurial talent in environmental innovation.
  • Liberalise drone and genetic editing regulations to make it easier for farmers to take advantage of technology.
  • Reforming the Bus Services Operator Grant so cleaner fuels such as hydrogen are not penalised.
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Eamonn Ives, author of the report, says: “If Britain truly wants to ‘build back better’, it cannot ignore the vital role that environmental entrepreneurs will have to play.

“Only by developing new products and ways of doing things can the economy bounce back, in a way which doesn’t harm the planet.

“To promote markets in sustainability, the Government must start both properly rewarding innovators, while clamping down on pollution and other forms of environmental degradation. “Doing so would incentivise entrepreneurial activity in green solutions, and give British entrepreneurs a head start in the global race to succeed in the growth sectors of tomorrow.”



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