The divide between the UK’s North and South continues to widen as companies begin their journey to Net Zero, according to new findings from Time Finance.
Exploring businesses’ efforts to ‘go green’ in the new year, the alternative finance provider found that while 70% of UK business owners surveyed have already implemented measures to become more sustainable (from partnership with sustainable suppliers to investment in electric vehicles and other environmentally friendly machinery), the results paint a disturbing picture of regional challenges and setbacks.
Businesses based in the central and northern parts of the UK raised concerns about the affordability of sustainable investing, with 100% of businesses based in the East Midlands and almost one business in the North West on 5 respondents stating that the cost of implementing green initiatives deters them from taking action to improve their sustainability. Comparatively, business owners in the South and Wales regions of the UK did not see affordability as a barrier to change.
As a result, only 20% of businesses in the North will consider green investments, such as resources, equipment and training, in the next 6 months, compared to 100% of the South East, South West and South regions. Wales who will. Half of these companies will use existing cash flow to finance their sustainability plans, 1 in 4 will use their existing banking provider and 1 in 4 will turn to an alternative financing provider.
Ed Rimmer, CEO of Time Finance, commented:
“Our impact on the environment has been in the headlines after COP26 and the pressure is on UK businesses to act now. For those who were already taking action to reduce their carbon footprint, it has refocused their attention and for those who had not yet launched environmental initiatives, the road to net zero was laid out for them.What we can see in our survey is that for many the intention is there, but SMEs, many of whom are still in the post-pandemic recovery phase, face a lack of capital, encouragement and confidence to invest in more sustainable practices.
“There seems to be a huge difference between companies in the North and the South and the progress they are making in their efforts to go green. As a national funder, we want to ensure that every business, regardless of location, breaks down these barriers and can realize their investment plans, whatever they may be.
Overall, 2 in 3 SMEs believe there is not enough government support to help sustain the adoption of green initiatives. 45% think there should be more guidance available on what steps can be taken to improve their carbon footprint and what systems can be put in place to track a business’ impact on the environment. 22% noted that there should be a job training and investment program to support a green economy.
“Interestingly, it’s not just about funding. There appears to be a gap in available knowledge, guidance and skills training. To me, it’s clear that getting closer to net zero involves incremental change. Business owners overcome a variety of challenges every day, and because of this, they simply can’t devote all their time and resources to just one (albeit pressing) problem. That said, the pressure to tackle climate change remains. If SMEs are to act now, they need more support.
Time Finance specializes in providing or setting up finance solutions for UK businesses looking to access the finance they need to achieve their growth plans. UK businesses can take advantage of an extensive portfolio including: asset finance, invoice finance, commercial loans, property finance and vehicle finance. As the market continues to improve, Time Finance is confident that the company is well positioned to take advantage of the opportunities that are expected to arise over the coming months and beyond.