The latest findings from Aldermore’s ‘Green’ SME Index have cast a spotlight on the state of sustainability efforts among UK small and medium-sized enterprises (SMEs).
Despite the looming implementation of new UK Sustainability Reporting Standards in 2026, the transition to environmentally friendly practices appears to be grinding to a halt.
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The study revealed that only 13% of SMEs are on track to meet net zero emissions by 2050, a figure that has not improved since last year’s survey.
It added that only 24% of SME leaders are assessing their goals, while most SMEs are either in the early stages or actively disengaged.
Furthermore, most SMEs appear to be either in the nascent stages of considering their environmental impact or are not engaging with sustainability at all.
A substantial 82% of SMEs view sustainability regulations as an obstacle to their business operations, and a notable 58% are not aware of the crucial Scope 1, 2, and 3 emissions categories, which are integral to future reporting standards.
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By GlobalDataDespite these challenges, SMEs recognise the potential financial gains from embracing sustainability, estimating an average potential increase of £52,198 in annual income.
However, actual investment in sustainable practices is low, with businesses spending an average of £5,566 on exploring green options and £23,715 on implementing them.
The data for this study was collected by Opinium on behalf of Aldermore between 2 April and 11 April 2025 and is based on responses from 1,000 senior decision-makers within the SME sector.
Aldermore head of energy and infrastructure Lauren Pamma said: “Our research shows genuine ambition among SMEs to decarbonise, but a lack of knowledge, resource and access to capital is holding many back.
“With reporting deadlines approaching, now is the time for government, industry and finance partners to step up their support. By closing the skills gap and providing targeted funding, we can help SMEs unlock the substantial growth, energy security and cost savings that sustainability delivers.”
