The Importance of Green Sustainability for SMEs: A Digital Perspective

SME business owner making sales in store and online

Recent research from IONOS found that over two thirds (68%) of the surveyed small businesses in the UK* stated sustainability and environmental protection for their business as important. Here, Randeep Sanghera, Head of Sustainability at IONOS offers advice to SMEs to help them on their own sustainability journey, breaking down the importance of going green, and how they can achieve this through technological solutions.

Benefits of SMEs going green

As smaller operations, SMEs and start-up businesses often underestimate the value of their contribution towards supporting environmental sustainability. However, according to a study conducted by Middlesex University, SMEs have been estimated to account for 45% of the UK’s business energy use. It’s more important than ever for SMEs to evaluate their strategy as environmental practices draw increasing scrutiny from consumers and the social responsibility of businesses within the local community becomes ever more central to brand reputation.

This increased environmental consciousness among customers and employees is reflected in a recent survey from GlobalWebIndex, which found that 80% of internet users in the UK are ‘concerned’ about the future of the environment. Creating a long-term sustainability strategy can improve sentiment across this audience as well as boosting employee morale by developing a deeper sense of purpose in job roles, helping to retain key staff.

In addition, according to the Green Energy Advice Bureau, around a third of businesses have seen a drop in their running costs as a result of making more environmentally-focused investments. These investments can take many forms and technology is playing a particularly significant role in sustainability roadmaps for businesses.

How technology can help SMEs go green

Identifying exactly how to transform sustainability practices can feel overwhelming but there are a range of different technological processes, steps and solutions which SMEs can utilise to drive down their environmental footprint.

Collaborative cloud solutions

One such way is implementing collaborative cloud solutions, which can be both a cost and time effective way for employees to engage with their work and will help any business on their sustainability journey.

Cloud computing offers a green IT approach as it has several environmental benefits compared to traditional on-site hardware, with a study by Lawrence Berkeley National Laboratory in conjunction with Northwestern University revealing that transitioning commonly used software applications to the cloud could cut technology energy consumption by up to 87%. With 65% of businesses surveyed by IONOS believing saving energy to be an important aspect of their sustainability strategies, implementing cloud technology can be one way to help support this.

Its scalability also means businesses only use what they need, and this utilisation allows for greater energy and resource efficiency at the data centre managing several networks at once, consolidating the server footprint as needed.

With cloud services, employees can work from wherever they want and access and share whatever information they need, particularly a boon with greater remote working now taking place. This subsequently allows SMEs to work more effectively whilst minimising dependency on hardware, which can be less environmentally friendly.

This reduction in environmental impact and operational costs can be achieved through comprehensive cloud services such as Managed Nextcloud. Plans such as these come with a variety of options, meaning SMEs can choose tailored cloud storage that meets their business needs.

A hybrid retail approach

Operating as a small business can often mean managing both physical and online retail spaces, and an e-commerce offering can be a beneficial part of a green strategy.  E-commerce has the potential to reduce the carbon and economic footprint as the need for physical shops decreases.

While the thought of setting up an e-commerce website might feel daunting, using e-commerce website builders can improve the success of this transformation as it provides simple, effective designs that are easy to set up and can be tailored to the business’s needs. Ultimately, this can allow SMEs to become less dependent on just physical shops and help reduce their carbon footprint, through reduction in electricity usage for the retail space or employee or customer transport.

For those still managing a physical space, looking at the wider role business can play in the community it supports is a vital part of the wider sustainability puzzle, and our research saw nearly two thirds (61%) of businesses highlight the importance of having social responsibility within the local community. Especially, as this can contribute to both brand awareness and a wider green strategy.

Exploring how technology, like e-commerce websites, can support a greener business approach, alongside adopting a responsible business mind-set is an important element that can help manage environmental impact.

Third party green credentials

When exploring ways to improve sustainability, SMEs are considering all aspects of the business, including the green credentials of suppliers. Our research found over half (53%) of the respondents believed selecting sustainable suppliers was important to their overall green strategy. Technology providers are no different and there’s a range of ways to understand how sustainable they are.

For example, when it comes to cloud or hosting providers, understanding if the provider has a commitment to renewable energy should be the first step – IONOS data centres run on 100% renewable electricity. Secondly, as over 40% of the energy consumption of a data centre can be attributable to cooling systems, a focus on optimising these systems is imperative. As a result of focusing on energy efficiency measures IONOS has been able to reduce absolute energy use in it’s data centres by 14% from 2018 to 2021.

Alongside this, data centres are constantly adapting and consistently optimised through server utilisation, which is also key in order to reduce energy use, carbon emissions and improve efficiency.

Ultimately, there are a wide range of considerations for SMEs looking to accelerate or even simply start on their sustainability journey. Implementing these technical processes and solutions can be an effective first step for any business towards a greener future and in a world where it is increasingly integral for businesses of all sizes to have a clear sustainability strategy, there’s no cause for delay.

*Source: Online survey by YouGov on behalf of IONOS of 1,002 respondents in companies with up to 250 employees, survey period 14 to 20 January 2022.

Randeep Sanghera, Head of Sustainability at IONOS

Randeep Sanghera, Head of Sustainability at IONOS

Rebecca Grewcock