November 28, 2023

SME BUSINESS NEWS

Small Business News from NTSI

Overcoming the Bystander Effect in Decarbonisation

Tim Rook, Chief Markets Officer at Clade Engineering Systems, shares insights into how SMEs can drive decarbonisation and adopt renewable energy sources to combat climate change in the UK commercial sector.

The SME Landscape: A Key Player in Decarbonisation

In 2022, private sector businesses in the UK amounted to 5.5 million, and The Federation of Small Businesses (FSB) reported SMEs forming 99.2% of all businesses in the UK, contributing half of the private sector’s turnover and three-fifths of the country’s workforce.

Based on these figures alone, it’s clear that SMEs play a critical role  in the fight against climate change, drive to decarbonisation and the transition to renewable energy.

Many SMEs feel genuine desire for tackling climate change, however, barriers form around areas such as cost and a lack of awareness of available support networks. Climate initiatives, business grants, and information about energy sources such as commercial heat pumps and solar panel installations exist, but many SMEs either cannot afford them or are unaware of their accessibility.

What’s more concerning than affordability or awareness of solutions, perhaps,  is the potential for SMEs to succumb to what’s known as the bystander effect.

The Bystander Effect in the Context of Climate Change

In social psychology, the bystander effect suggests that in an emergency situation, a greater presence of people results in the lesser likelihood of someone stepping forward to offer help. In essence, each individual silently assumes that someone else will step forward and take action, which results in complete and collective inaction.

When applied to the current global climate crisis and the inaction of SMEs and businesses in general regarding decarbonisation, this concept holds true. Cost and awareness aside, it’s understandable for individuals to feel overwhelmed by the scale of climate change and question the impact of seemingly minute individual efforts, such as proper recycling. From a business perspective, smaller changes may seem arbitrary, while significant changes to operations pose new challenges, including short-term costs and the adoption of new methods by staff and customers. Change, in any form, demands time, resources, and financial investment.

It is in the face of these challenges that small business owners may resolve to reassure themselves that their contributions to decarbonisation would be “minimal” compared to those of larger businesses. They might believe that they need not take action, as the efforts of others will suffice.

While it’s true that individual inaction might seem inconsequential, applying the logic of the bystander effect reveals that as more businesses adopt this mindset, the impact of inaction grows, becoming a significant obstacle to genuine progress.

The Path Forward: Decarbonisation and Achieving Net Zero

Despite the challenges on the path ahead, decarbonisation of the commercial sector is an attainable goal, and reaching Net Zero is vital for the long-term well-being of our planet. Let’s explore some strategies for businesses to initiate, continue, or expand their decarbonisation efforts.

Support for Small Businesses

It’s imperative that small business owners overcome the bystander effect and proactively engage in decarbonisation efforts. To facilitate this, the UK Government has launched the Sustainability Hub, aimed at assisting 5.5 million small businesses in their decarbonisation journey.

The UK Business Climate Hub offers valuable resources for SMEs, helping them transition to renewable energy sources like air source heat pumps while simultaneously reducing energy costs—a particularly essential benefit in a time when energy bills are rising. Through the hub, businesses can access guidance on cost-effective climate initiatives, carbon credits, sustainability training, waste reduction, green supplier sourcing, and business grants.

Commercial Heat Pumps as a Sustainable Solution

Small business owners can make meaningful strides toward sustainability by installing commercial heat pumps, underscoring their commitment to decarbonisation rather than mere lip service. Commercial air source heat pumps represent a compelling solution for small businesses in the UK striving to meet the government’s Net Zero 2050 target.

These heat pumps possess the technology to serve as low-carbon heat providers for both commercial and residential properties, significantly reducing carbon footprints and energy bills simultaneously. When the benefits of these solutions are so readily apparent, it becomes difficult to understand why any business owner would hesitate to make the switch.

Business Benefits of Net Zero

In the face of the increasingly evident impact of climate change, reducing carbon emissions has become a political priority, and smaller businesses are key in the UK’s plans for net zero emissions by 2050. For SMEs, net zero entails sustainable services, products made from sustainable materials, well-insulated workplaces, promotion of public transport, sustainable distribution and shipping, and reliance on renewable energy sources such as commercial heat pumps.

 

The advantages of Net Zero for SMEs include:

 

  • Enhanced Business Reputation: Modern consumers are more inclined to support brands that operate sustainably, making them long-term customers.

 

  • Reduced Energy Costs: Installation of commercial heat pumps, solar panels, and other renewable energy sources can significantly reduce energy consumption and bills.

 

  • Attractiveness to Investors: Sustainability-focused businesses are more attractive to potential investors.

 

  • Process Stability: By adopting electric vehicles and renewable energy sources, businesses can become more self-sufficient, reducing reliance on volatile energy markets.

In Conclusion: Mobilizing for Sustainable Business Practices

Interest in achieving Net Zero is growing among business owners of all sizes in the UK. However, the bystander effect—hesitating to act until others do—poses a significant challenge. To drive meaningful change, there must be greater influence and incentives from government bodies and renewable energy suppliers, such as commercial heat pump providers and solar power companies. This collaboration is essential to inspire SMEs to make significant strides toward sustainable business practices and contribute substantially to decarbonisation efforts.