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 Half of East Midlands smaller businesses don’t understand ‘carbon jargon’, new British Business Bank research reveals

Half of East Midlands smaller businesses don’t understand ‘carbon jargon’, new British Business Bank research reveals

Half of smaller businesses in the East Midlands don’t understand how common environmental terms such as ‘net zero’, ‘carbon neutral’ and ‘carbon footprint’ apply to their businesses, according to new research commissioned by the British Business Bank.

The Opinium survey of 1,000 senior decision makers in smaller businesses across the country found that half (50%) believe the language, terminology and information around emissions reduction are over complex. The region was slightly below the national average of respondents across the UK (54%)

Over three in five (67%) say they would find more information and advice about taking action to measure and reduce their business’ carbon emissions helpful, with just over two in five (42%) of those wanting advice on measuring their business’ carbon footprint.  Nearly half (47%) would like information to help work out if reducing carbon emissions makes financial sense for their business.

Nearly half (44%) of those surveyed don’t know where to get information on reducing their carbon emissions and how best to approach related commercial or financial opportunities. 

The British Business Bank’s #GreenToGrow campaign, launching today, aims to demystify and alert smaller businesses to the commercial benefits of investing in decarbonisation. Resources include a new ‘Green Decoder’, an online guide co-created with the Nottingham Trent Business School to help smaller businesses decipher the terminology surrounding decarbonisation.

The British Business Bank’s online Finance Hub also provides a series of guides and information about green issues and how smaller businesses can start their journey towards net zero.

‘Carbon jargon’ terms misunderstood by East Midlands businesses include:

  1. Greenhouse gas emissions: 91% 

  2. Decarbonisation: 87%

  3. Net Zero: 74%

  4. Carbon Neutral: 70%

  5. Carbon Footprint: 61%

Dr Sophie Dale-Black, Midlands UK Network Director at the British Business Bank, said:

“Smaller businesses in the East Midlands are far too often put off by the over complex ‘carbon jargon’ that comes with reducing emissions. By helping decipher some of the terminology around decarbonisation the British Business Bank hopes to show smaller businesses that simple, incremental changes, such as switching off equipment when not in use can make a difference in their net zero transition.

“This will become an increasingly important business requirement. Given that many consumers now consider sustainability when they make a purchase, by becoming greener, smaller businesses can enhance their competitive edge and expand their customer base. 

“Our new mission at the Bank is to continue to drive sustainable growth across the UK, and to enable the transition to a net zero economy, by improving access to finance for small businesses. This new #GreenToGrow campaign will help more smaller businesses in the East Midlands find the information they need to move toward transition.”

Smaller businesses have a big role to play 

The British Business Bank’s Smaller businesses and the transition to net zero report, published in October 2021, found that smaller businesses account for around half (50%) of total emissions from UK businesses.

Less than two in five (35%) businesses in the East Midlands half believe, however, that a reduction in their carbon emissions will not make a significant difference to the environment and 61% believe large corporations are responsible for most of the business carbon emissions in the UK. 

Finance as an enabler to ‘net zero’ transition

Only six percent of East Midlands smaller businesses say reducing their carbon footprint and environmental impact is their number one priority for 2022. The Smaller businesses and the transition to net zero report also found that more than a third (35%)2 cited costs as a barrier for reducing their carbon emissions, particularly upfront capital costs (21%)2. 

So far, 11% of the smaller business population - equating to around 700,000 businesses in the UK - have accessed external finance, in the form of loans or equity, to support ‘net zero’ actions, with 22%2 – equivalent to around 1.3 million businesses – saying they are prepared to access external finance to support ‘net zero’ actions in the next five years.

Dr Muhammad Mazhar, Senior Lecturer in Sustainability, Nottingham Business School, Nottingham Trent University, commented:

“Smaller businesses are key to our economy and have significant carbon emissions impact. They can act as agents for change to meet the UK government’s net zero targets. Most smaller businesses are at the initial stage of their carbon management journey and will benefit from the support provided through the British Business Bank’s #GreenToGrow campaign. Smaller businesses have been overlooked in the past and this is changing. The business case for carbon management is stronger than ever and smaller businesses have an opportunity to act now to remain competitive.” 

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