Approximately 95% of all businesses are Micro, Small and Medium-sized Enterprises (SMEs), and collectively they employ more than half the world’s workers. As well as being the backbone of the global economy, SMEs are a significant source of innovation. However, as SMEs often operate below the radar of NGOs and the media, their role in ensuring that we achieve the WBCSD’s vision of “One World – People and Planet” is often neglected. Luckily, a silent revolution is taking place.
Nearly a third of all Global Compact signatories are SMEs, indicating that issues such as human rights, labour conditions, environmental impact, and corruption are concerns shared by all businesses, both large and small. In addition to this, more and more SMEs are talking about sustainability, and the Global Reporting Initiative provide a range of tools and workshops aimed exclusively at SMEs. In Europe, the Small Business Act recognizes the fact that public policy often alienates SMEs. It therefore aims at promoting greater responsiveness to SMEs needs in order to enable them to participate more fully in creating greater economic growth in Europe.
There are also a number of localized initiatives encouraging SMEs to participate in creating a more sustainable future, such as the newly launched Responsible Business Standard exclusively aimed at SMEs in the UK. The standard offers practical guidance to SMEs in the form of a basic yet comprehensive non-financial audit, and requires companies to commit to continuous improvement within the areas of marketplace, environment, community, workplace, ethics, values and transparency and governance.
So, here are some tips for SMEs who are looking to increase their commitment to sustainable business:
- Impact locally: SMEs are the backbone of the global economy, but are, more often than not, deeply rooted in local rather than global communities. Start by looking for opportunities to impact your local community, e.g. through the local school, providing internships through the local employment office, or campaigning for a local social or environmental cause.
- Be an advocate for ethical supply chains: SMEs are often at the compliance end of the CR yardstick, being subjected to compliance audits by larger organizations. Use your voice to be an advocate for clearer, more comprehensive, and perhaps even more stringent criteria in order to ensure that your business partnerships are catalysts for a greener future. Talk to your own suppliers too and see if you can work together to create a greener supply chain for your businesses.
- Think strategically: Make sure that your CR activites are aligned with your business goals. If you want to donate to charity, look for synergies in the philanthropic partnerships you create, for example the learning opportunities of working closely with a local charity, or opportunities for joint ventures that will both support a local cause and create competitive advantage for your business.
- Achieve eco-efficiencies: Take a good look at your main business processes and identify ways of minimizing both the resource intensity (water and energy use) and environmental impact (emissions and waste created) of your business operations.
- Engage with stakeholders: Tell all of your key stakeholders (e.g. employees, suppliers, customers, local government) what you are doing, and ask for their ideas and feedback. If possible, get them involved too.
- Communicate openly: it is important to tell people about the good things you are doing, and all the things you are working on improving. Going public deepens your commitment to change. It also promotes your business to new markets, new customers, and potential employees who share your vision and can help your business grow.