U.S. SMEs struggle with sustainability more than global peers, find reporting standards complex and costly
Sage research identifies the motivators and roadblocks for American businesses to become more sustainable
ATLANTA, Nov. 16, 2023 (GLOBE NEWSWIRE) -- U.S. small and medium enterprises (SMEs) are grappling to keep up with the jargon and technical expertise of sustainability reporting and standards, according to Sage, the leader in accounting, financial, HR, and payroll technology for small and mid-sized businesses. A global study of 16,423 SMEs launched today shows that a promising number of businesses want to make progress on their path to sustainability but are unable to measure and report on their impact, preventing them from acting on their ambition, or from realizing the business benefits of sustainability.
Embracing ESG despite the complexities
The data reveals U.S. SMEs are interested in enhancing their sustainable business practices but place other business priorities first.
Creating accessible reporting standards
American businesses are somewhat environmentally conscious but are not among the global leaders in this space. Moreover, over half (53%) think that sustainability reporting can enhance their reputation. If reporting standards were simpler and more closely tailored to their businesses, 59% believe that they would be more inclined to engage in climate reporting. The potential ease that digital tools could bring to this proces is clear, with three out of four (58%) of businesses considering such tools to be very important in simplifying environmental reporting.
Considering these findings, Sage, ICC and PwC UK are issuing the following recommendations for standard-setters, governments, and industry leaders to consider in order to make the reporting landscape more accessible for SMEs across the world.
Elisa Moscolin, Executive Vice President of Sustainability & Society at Sage, said: “Beyond the figures, the report tells us one key thing: there is in an indelible connection between sustainability reporting and action – SMEs can’t fix what they can’t see. Tech is a huge part of that – 63% of SMEs told us the right digital tools will make it easier for them to report, and we are committed to being part of the solution there with tools like Sage Earth. But it will take an ecosystem to get SMEs – and society at large – to embrace sustainability, and we hope to partner closely with governing bodies and governments to make the reporting landscape more accessible for SMEs across the world.”
John W. H. Denton AO, Secretary-General of ICC, said: “As the institutional representative of more than 45 million businesses worldwide, we see every day the potential of SMEs to lead the way in creating a more sustainable future. While it is clear that SMEs are increasingly taking action, this report identifies what SMEs need to deliver fully on the promise of a more sustainable and prosperous future. Specifically, we must provide SMEs with the right policies and incentives, effective tools and, most importantly, SMEs need a collaborative effort to transform business practices. By collectively focusing our attention on these key areas of action, we can enable SMEs to tackle the obstacles in their way to better understanding, managing and ultimately improving their sustainability performance.”
Lynne Baber, Head of Sustainability at PwC UK, said: “The critical contribution SMEs will make in how the world meets sustainability goals must be grounded in clear and reliable reporting, and the link between accurate reporting and effective and meaningful action is clear. Just 8% of SMEs say that they are reporting on sustainability issues, indicating the need for support in navigating such a complex and resource intensive process. This will require collaboration across markets, industries and government leaders to develop tech-powered solutions that will make sustainability reporting more efficient and accessible.”
SMEs were defined as those employing less than 250 people in the U.K., U.S., Germany, France, Italy, Spain, Poland, Romania, Netherlands, Belgium, Brazil, South Africa, Thailand, Canada, Australia and Kenya. The U.S. sample size is 1,003.
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