Amid the “great resignation”, businesses of all sizes are having to work harder to keep hold of their staff. While this once may only have meant increasing salaries and piling on lavish bonus packages, many employees’ priorities have now shifted. Alongside the demand for flexible working, the desire to work for a company with ethical values is on the up.
With the pandemic “pause” providing a moment of reflection and the climate crisis becoming ever more pressing, living in a planet-friendly way is taking precedence for many: according to a 2021 study, 58% of consumers said they are now more mindful of their impact on the environment since Covid-19. Naturally, this mindset extends to the workplace, and increasingly employees are considering a company’s sustainable and ethical policies when applying for roles or weighing up whether to stay put or move on.
As any experienced small and medium enterprise (SME) owner knows, keeping hold of the right staff is key to both business development and profitability. For small businesses in particular, high turnover of staff isn’t good for company morale and can become a time- and energy-consuming issue. In 2022, investing in ethical policies makes sense for the planet and your business; according to research from Deloitte “purpose-driven companies” had 40% higher levels of workforce retention than their competitors.
For businesses looking to snap up new young talent, prioritising green policies is key. The 2016 Cone Communications Millennial Employee Study found that 83% of millennials (now aged 26-41) consider a company’s social and environmental commitments when deciding where to work, while in 2021 insight company Tallo Data found that for generation Z (under-24s) having a fair and ethical boss was the most important factor about their work environment.
It’s no surprise then that for SME owners, prioritising ethical concerns is often driven by their employees. According to the British Business Bank, 33% of businesses list their staff’s motivation as a reason for going greener. Doing so isn’t always easy, but making it a priority is becoming increasingly important.
Being open and transparent about your objectives and aims when it comes to ethics and sustainability is crucial. If you’re nervous and don’t know where to start, choosing a person or team (depending on the size of your business) to lead the charge is a great first step. Progress can only be measured if you have a baseline to work from, so begin by completing an audit of your current situation; this will allow you to clearly see the changes needed and help you draw up goals and identify the most crucial priorities. From this you can create a realistic plan with a short- and long-term timeframe.
Involving your employees in this process will ensure they feel heard and listened to, and understand your commitment to becoming a more ethical business. Consider holding focus groups for those who are interested in sharing their opinions or ask your employees for feedback via digital means. As you make progress with goals and new initiatives, keep staff in the loop with regular communications – and always be open to feedback.
When it comes to choosing which green initiatives to implement first, those that directly affect your employees are a good call. This will showcase, in the most visible way, how you hope to make an impact. Some of these schemes can be very easy to set up, and the cost can often be minimal. For example, switching to a plastic-free office will make a strong, positive statement – just remember to help employees with this transition by investing in non-plastic alternatives. Ensuring you have the correct recycling facilities (with clear instructions on what goes where) and making as many processes as possible paperless are also good initial steps. How your office or business space is powered should also be considered; switching to renewable resources will help bring down your carbon emissions from burning fossil fuels (for energy and heat).
However, these actions alone won’t be enough, and it’s important to not greenwash your staff into thinking you’re doing more than you are. Making fundamental changes to the operations of your business should be just as much of a priority. This will vary between industries, but for those companies that produce physical goods, it’s important to take a look at your supply chain. Working with suppliers and manufacturers that operate ethically – which covers everything from fair treatment and pay of staff to the emissions and waste created – should be a top priority.
To be a truly ethical company, looking after your staff is key. While fair pay, flexible working and effective support systems are important, investing in diversity and inclusion and giving back via authentic corporate social responsibility schemes are also just as important.
It isn’t necessarily a quick or easy process, but becoming a more ethical company is well worth it – for your staff, the planet and the success of your business.
If you’d like help to green – and grow – your business, the British Business Bank should be your first port of call. Dedicated to making finance markets work better for smaller businesses, it provides free financial tools and expert information to get you moving in the right direction. Find out more at british-business-bank.co.uk/finance-hub/sustainability
