The word sustainable is one of the more common “buzz” words being used currently. In essence it refers to the ability of being maintained at a reliable rate without causing damage. Typically, it will be associated with a social or environmental goal.
It is also being introduced into the area of finance under the heading of sustainable finance. Sustainable finance will take into consideration areas of environmental, social and governance. The money made available under this remit is as a result of longer-term investments in sustainable and economic projects.
With the government focused on transitioning to a sustainable economy, more and more businesses are dedicating time and resources to adopt processes which carefully consider these factors. With a target of net zero, the SME sector will play an important role in social and environmental best practices.
Sustainable finance has been introduced to help businesses with their commitment in reducing the carbon footprint. Funding initiatives like this help in 5 key areas:
- Developing financial solutions which bring broad benefits and help deliver positive action in climate change.
- Increasing awareness of sustainability and how it should be applied in a business scenario. At times this could also highlight areas or skills needed to complete these transitions.
- Building knowledge across all areas so that when new purchases are made, they can be undertaken with sustainability in mind.
- When employees are made more aware of their sustainable responsibilities they can be upskilled and retrained to help embed new initiatives and processes into the business.
- Better access to products and services that are sustainably focussed and designed with helping protect the environment.
One final point, businesses need to start to recognise the importance of sustainability and adopt best practices. There are several great resources that can help successfully navigate through the changes needed.
If you have questions or need some help with any aspect of sustainable finance our team would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 30-minute call with Yarka – https://calendly.com/yarka-ssa/30min
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