It’s easy to think that climate change is something only big businesses can afford to worry about. If you’re running a small or medium-sized business, you’re likely squeezed for resource, whether that’s time, money, or both. Add to that the feeling that any changes you make won’t make a difference to the overall picture, and inertia sets in.

But here’s the thing: sustainability isn’t just for the giants. First off, the British Business Bank estimates that teams of less than 250 people account for ~50% of UK business-driven carbon emissions. Collective action from SMEs to reduce emissions is therefore essential.

Second, understanding and acting on your emissions could be more commercially relevant than you realise. While Greenhouse Gas (GHG) reporting is voluntary for SMEs (unlike for bigger organisations where it can be a legal requirement), many stakeholders—blue chip clients, public sector buyers, investors, and certifiers like B Corp—expect action. Add these up and getting on top of your emissions as an SME shifts from voluntary to vital.

But what does ‘getting on top of emissions’ actually look like? What can you feasibly do as an SME, at the whim of big orgs, suppliers on one side and customers on the other. Well, it turns out there’s actually a fair bit.

In this article we’ll discuss the real challenges SMEs face, before diving into practical, achievable steps for any small or mid-sized business looking to measure their carbon footprint and reduce emissions. Whether you’re an Ops leader trying to kickstart change or a business owner looking to future-proof your company, you’ll find pragmatic steps to build your understanding and take action.

Key Sustainability Challenges for Small Businesses

Let’s begin with the top 3 hurdles SMEs face when looking to make sustainable changes:

1. Limited resource – time and budget

Nowadays, big corporates have ESG leads and dedicated sustainability budgets, but as an SME you don’t have the money to hire in-house expertise. Your ESG efforts will need to be managed by someone in your team (an Ops manager is typical) alongside their day job. This means time is tight – hours spent measuring your carbon emissions are hours not spent growing or looking after your team. The challenge: how to understand your footprint, and what you can do to reduce it, in a way that’s time efficient.

SME budgets mean you’ll also need to closely evaluate the cost of those decarbonisation plans, prioritizing free / low-cost changes, and maximising impact per £ spent.

2. Lack of Expertise

Sustainability can be jargon-loaded and complex, with carbon footprinting in particular requiring some pretty niche expertise. How do you make sure your carbon footprint is measured compliantly in line with the GHG Protocol? What’s the difference between Carbon Neutral and Net Zero? This steep learning curve for your nominated ESG lead has the potential to become a serious time sink. Add to that the risk of miscalculating and miscommunicating your impact, and the harm to your reputation of greenwash, and getting external support starts to sound like a good idea.

And here we find ourselves back at challenge 1 – as an SME, you likely can’t afford to pay for the support of expensive day-rate consultants with add on fees.

3. Narrow influence

As an SME, your carbon footprint will be relatively small, especially if your business operations are inherently low-impact (think people-based businesses – creative agencies, law firms, consultants). A lot of that footprint will come from the goods and services you buy, therefore outside of your direct control. Your objective is to encourage your supply chain partners to reduce their emissions, but this can be a real challenge for SMEs with limited influence and purchasing power.

Put together, these challenges might seem overwhelming, but they aren’t insurmountable. The truth is, once you understand what you’re up against, the solutions start to feel a lot more manageable.

Affordable Climate Action for SMEs

Now that we’ve tackled the challenges, let’s dive into the good stuff: solutions. There are plenty of time-and-budget-friendly ways for SMEs to build an informed sustainability strategy.

In fact, many of these solutions not only help the environment but can also save your business money in the long run. Here are some affordable, practical ways to get started:

1. Carbon Accounting Software

As you’ll often hear, the first step to reducing your carbon footprint is to measure it. Only once you understand what your impact as a business is can you make informed choices to decarbonise. An effective emissions reduction plan uses data to focus on high impact areas, often called emission hotspot analysis. You can then set targets, track your progress year-on-year, and report (compliantly) to your stakeholders.

SME-focussed carbon accounting platforms like Seedling give you the power to measure, monitor, and report your carbon emissions in a way that’s easy and affordable. They’re a way for SMEs to bridge the knowledge and resource gap, without spending >£10ks on consultants.

You’ll want to make sure you choose an SME-focussed provider. Enterprise software solutions offer bespoke integrations and other functionality great for larger organisations, but overkill and out of budget for smaller teams.

Seedling, in particular, is designed specifically for SMEs, with easy-to-use software and one-to-one support from a carbon footprinting expert too. This means you can take control of your emissions and make smarter decisions—without needing a full-time sustainability expert on your team.

2. Energy Efficiency

A good energy management policy can lead to material reductions in both GHG emissions and energy bills. So, it’s not the most exciting topic, but energy efficiency is key to running a responsible and profitable business, and there are simple steps that every business can take.

Before you get started, it’s essential to engage your team with the concept of energy management, and why you’re looking to make changes. A lot can be achieved with simple switches to behaviours if everyone is on board. It’s a good idea to appoint an ‘energy champion’ to take the lead. If your office space is shared, consider getting buy-in from the teams you work alongside.

We’ve written a couple guides (top tips for energy efficiency in the office, and how to save energy and reduce emissions when working from home) to give you a detailed but easy to digest list of steps to follow. For now, to get a sense of the opportunity to reduce emissions and save costs, let’s take a look at the switch to more energy efficient bulbs as an example. Replacing traditional bulbs with LEDs could reduce your lighting costs by up to 75%, with a payback period of 1-4 years depending on the bulb you buy (keep an eye out for energy-efficient certifications like Energy Star). So, whilst there’s an upfront cost, this cost is not too big, and you’ll make money in the short-medium term.

A quick reminder – you’ll only be able to show the impact of these changes if you’re measuring an accurate carbon footprint. For office emissions, this means doing your best to get your hands on kWhs of electricity consumed from your energy bills. If you don’t have this data currently, have a chat with your landlord to see if it can be made available. If you’re in a shared space, one solution may be to apportion energy based on floor space occupied.  For home-working emissions, Seedling’s employee survey captures data on how your team consumes energy when they work from home, helping to track Scope 3 reductions too.

3. Green Tariffs

Switching to a green tariff will reduce what is called your ‘market-based’ footprint. What does this mean? Well, when it comes to emissions from purchased electricity, under the GHG Protocol’s ‘dual reporting’ rule, businesses should report 2 emissions figures:

• Location based – based on the average grid mix
• Market based – based on your tariff

This means that businesses get credit for choosing a tariff with a higher mix of renewables than the UK grid, but also keeps things accurate by recognising that everyone connected to the grid consumes the same electricity, regardless of tariff (take a look at our detailed green tariff explainer on dual reporting for more information).

Switching to a green tariff will (usually) mean a premium on your bill. Moreover, unlike with energy efficiency, it is an outright cost, rather than saving you money on bills in the long run. The upside is that switching to a renewable tariff is a very low effort thing to do. It’s also typically more feasible and affordable (in terms of upfront cost) for SMEs than installing direct renewable power generation (like solar panels or heat pumps).

However, all green tariffs are not created equal, so give our green tariff guide a read to get our take on what to look out for.

Once again, it’s key that you accurately measure your carbon footprint, using the GHG Protocol’s dual reporting methodology to reflect the changes you make without misleading. A carbon accounting platform like Seedling is an affordable way to make sure this is done compliantly.

4. Commuting and business travel

Whether it’s the daily commute or business trips, reducing emissions from how your team travels is key for SMEs.

Your first port of call – set clear expectations as to when travel is necessary, and when a Teams call will do just fine. For most businesses, this includes having an open conversation with your clients to understand their expectations regarding your travel.

When travel is necessary, the travel hierarchy is a handy framework for reducing carbon emissions by prioritising transport options that are the least emissions intensive. You’ll need to endorse the travel hierarchy and educate your team, so that they understand the emissions output from different travel options and can make informed choices as a result.

The reality, however, is that convenience is king. Sometimes, it’s just plain awkward taking the more sustainable option. As a result, it’s key that you do all you can to engage and incentivise your team. Salary sacrifice schemes – from e-bikes to electric vehicles – are a great way to do just that. For more tips, head to our travel hierarchy guide for detailed advice by travel type.

When it comes to measuring your emissions from commuting and business travel, relying on spend-based data (translating £s spent on travel into emissions) will mean your footprint is pretty inaccurate. To understand why, think about it this way. If you travel via train, the price you pay for your ticket will vary hugely depending on a number of factors (the time of day you travel, how in advance you book your ticket etc.). The emissions from your journey won’t vary with the price of your ticket though – what matters is the distance you travelled via train. £s spent on train travel (a spend-based metric) is therefore a less accurate indicator of emissions than distance travelled via train (an activity-based metric).

Here’s some tops tips for getting your hands on that data:

• Get your team to book using travel portals that capture distance travelled – the Trainline business app is a handy (and free) example.
• Tweak the info you request for expenses to include mileage info.
• Use an employee survey to understand how your team commutes. Seedling’s employee survey takes 5 minutes to complete, and the data is auto-captured, so no analysis needed. Employee surveys are an effective team engagement tool too!

5. Reducing Waste

Reducing waste is another quick win. A good place to start is evaluating what you buy in the first place – again, this means making sure your team are engaged with your commitment to reduce emissions. Buying less, and buying better, should be front of mind. A few product features to look out for to reduce waste include:

• Reusable / longer-lasting alternatives
• Recycled or plant-based materials
• Non-landfill disposal options (composting or recycling)
• No/reduced/recyclable/plant-based packaging

Next, make sure you’re disposing of your waste correctly, whether that’s clear signposting to ensure everyday waste is recycled where possible, or thinking about how you can re-purpose assets when you make one-off upgrades (donating old office furniture for example).

One of the biggest criticisms of product packaging is how difficult it has become to understand the correct disposal method, particularly when it comes to plastics. Third-party commercial waste management providers are a great option to tackle this problem. Not only can they advise as to how to manage waste responsibly, but they can also capture data on the type, weight and disposal method of the waste you produce. This rich data can be used by teams like Seedling to capture a more accurate picture of emissions (vs. relying on averages) that reflects any reductions you achieve, reducing your footprint.

6. Engage your Supply Chain

As we discussed earlier, the products and services you buy as an SME have a big influence on your carbon footprint. And whilst you might not have lots of purchasing clout, that doesn’t mean you can’t take positive steps to reduce your supply chain emissions. Your first step is to have a careful think about what you buy, and how much you buy of it.

Look out for companies building less carbon intensive products (e.g. made using better materials or more energy-efficient processes), and those who have their own carbon reduction plans in place. Try building these criteria into your procurement guidelines; for instance, some businesses require their suppliers to have measured a GHG Protocol compliant footprint, or have set an emissions reduction target like the SBTi’s Net Zero.

When it comes to measuring supply chain emissions… this is where it gets tricky. What you really need is data on emissions from the specific product or service you’ve purchased. In some sectors, this data is easily available. For instance, many laptop manufacturers publish a product lifecycle emissions report (commonly known as a product lifecycle assessment or LCA), and some consultants calculate a project-specific emissions estimate. Mostly, however, this data is pretty hard to come by.

What’s your role in all of this as an SME? Simple: ask your suppliers for emissions data. And if you choose to get carbon footprint support, make sure your carbon accountant is able to capture this more accurate information from your suppliers. At Seedling, we can help you track both spend-based and supplier-specific emissions data. Our initial spend-based assessment and hotspot analysis will help you focus on high impact areas of your supply chain.

Wrapping Up

With the right tools and strategies, the murky world of managing your carbon footprint can become a list of affordable and pragmatic steps that any SME can take.

Need advice? Learn more about how Seedling’s software and one-to-one expert advice can help you track, reduce, and report your emissions—without the hassle.