NatWest

With energy prices soaring and supply chain issues continuing unabated, UK SMEs are looking at investing in sustainable initiatives with a greater urgency than ever before. As the UK’s largest business bank, NatWest conducts a quarterly Sustainable Business Tracker, gauging how purchasing decisions are being influenced by climate concerns. Our latest findings show: One in six SMEs intend to generate onsite green energy by 2023One in three SMEs plan to invest in electric vehicles or charging points by next year21% of SMEs are set to train or hire staff in sustainability in the next yearA strong SME recovery in March, led by service sector growth The increasing emphasis on green energy represents an exciting opportunity for UK SMEs.

In February, NatWest Group published its most extensive climate-related disclosure to date. Key highlights include: Providing £17.5 billion of climate and sustainability financing last year – aiming towards £100 billion by 2025. Launching green loans and green asset financing to provide fee-free lending for sustainable projects and investment. Collaborating with carbon tracking expert Cogo and becoming the first European bank to provide both personal and business customers with an estimated carbon footprint associated with their monthly spend.

‘Going green’ can seem like an expensive and complex process. While we’re seeing an unprecedented shift in the way many small and medium-sized enterprises (SMEs) feel about reducing emissions, there are still many barriers standing in their way according to NatWest’s head of business banking, Andrew Harrison. As the UK’s largest business bank, NatWest has a duty to support the diverse and enterprising SME sector in its bid to tackle the looming challenge of climate change. As part of this commitment – and to support UK decarbonisation and the government’s net zero strategy – NatWest has pledged to provide £100 billion in climate and sustainable funding and financing to smaller businesses by the end of 2025.

During the first week of COP26, NatWest gathered over 70 stakeholders in Glasgow to discuss practical steps for small and medium-sized enterprises (SMEs) to tackle climate change and lead the UK's green economic transformation. The session followed the bank’s ‘springboard to sustainable recovery’ report, which identified a £160 billion growth opportunity for British enterprises tackling climate change alongside the fact that 50 per cent of the country’s carbon reduction ambition can be delivered by the SME sector.

As a principal partner of COP26, NatWest has an important role to play in determining the true legacy of the summit, helping financial institutions, governments, industry bodies and business to deliver meaningful climate action behind the pledges made in Glasgow. Our recent UK Sustainability Purchasing Managers Index report highlighted that the nation’s businesses are committed to change, but more support is needed to help them take those crucial first green steps towards achieving their environmental ambitions, steps which can often seem expensive and complex to take on. The report revealed that more than half of UK firms say action on recycling (52 per cent) is a high priority over the next year.

There is a shared understanding that one of the top priorities facing the world is the need to reduce carbon emissions and enable businesses to transition to net zero. To support UK decarbonisation and the government’s net zero strategy, NatWest commissioned research which found that 50 per cent of the UK’s carbon reduction ambition can be delivered by the small and medium-sized enterprises sector, unlocking a £160 billion opportunity for those businesses in the process. This is vital; as the world comes together at COP26, we must all act with urgency if we are to avoid the worst impacts of climate change.