Top tips to help your clients operate a more sustainable business
Running a business which is more sustainable is of growing importance and was fuelled further by COP26 last year. This really reinforced the need for companies to take action against climate change in order to save the planet and tackle global warming.
In addition, we have seen new disclosure requirements for certain sectors as well as the recent new legislation on greenwashing to ensure companies accurately report what they do to be a more sustainable business. Greenwashing has been a huge area of concern where some businesses claimed they were sustainable but then, on investigation, this turned out to be untrue. So, to tackle this issue, the Green Claims Code came into force in January 2022.
Today some business contract tenders require information about the business’s sustainability practices and policies, and many companies question a business’s sustainability credentials before they will work with them.
Which leads to the question ‘how can we help our clients operate a more sustainable business?’
There are several ways that we can help including:
Add sustainability topics to all meeting agendas to ensure you discuss these when you meet the client. Keep these relevant to the client and specific to their circumstances. Also include some KPIs in your management reports which focus on sustainability and discuss targets for these KPIs which you can then track across the year.
Make sure you keep your clients up to date with sustainability developments through sending them updates and information on new legislation, news and proposals. Include some sustainability tips in your newsletters too.
Encourage your clients to look at their business and how they go about processes, their procedures and their policies. For example, when it comes to recruitment, how do they ensure that they address diversity and inclusion in their approach?
Consider using a sustainability framework such as the United Nations Sustainable Development Goals (UN SDGs) or the B Corp Impact Assessment with your client. Many of these are free to use and allow you to focus on specific areas of the client’s business or on the business as a whole.
Becoming a B Corp accredited business
Supporting clients through their B Corp Accreditation is a way to enable them address their business sustainability.
The accreditation process involves looking at the business as a whole rather than just one or two specific aspects, and involves answering a series of questions across the following five business areas:
There is also the requirement for the businesses to change their Articles of Association as part of the accreditation process.
Once the assessment has been completed, and so long as the minimum score of 80 points has been achieved, it can be submitted for verification. This is where an B Corp analyst reviews and audits the application and the business is required to supply evidence for some of its answers to support and demonstrate their scores. It is therefore important that this evidence is prepared and collected for the review stage.
Anyone can support businesses through their accreditation but there are B Leaders in the UK who are trained by B Lab to help and support other companies in their application process. They can be found on this website.
The assessment can take quite a long time to complete depending on the size, complexity and the time that the business can spend on the process. Time is one of the key issues as when work gets busy, often the completion of the assessment is put on hold. It is also important to point out to clients that this is quite a tough process too and it is estimated that only one in every three applications achieve certification.
The support can be provided on a one-to-one basis or it can be run as a more structured programme to a small group of companies. The advantage of doing it as a cohort is that you have a less fluid approach and a set fee and timeline for the programme.
However you decide to approach it, it is important that you agree how you are going to structure and invoice for the work in advance. The risk with leaving invoicing all to the end is that the client is delayed and so the work runs over a very long period of time. Therefore consider an initial payment or milestone payments instead to reduce delays and the impact on your cashflow.
One important point we need to remember is that we are accountants. It is therefore essential that we have a good network of contacts who we can introduce if the need arises. For example, a carbon consultant to calculate their scope one, two and three emissions could be needed if you do not have the expertise and knowledge to do this work. Similarly, you may need an HR expert or marketing specialist in sustainability.
Supporting clients on their sustainability journey is very rewarding work and something that accountants can do to support their clients. There are several ways this can be done but it is important to consider the value of the work and how you are going to approach it well in advance. While some steps may appear small – and you may feel they are not going to make an impact – it is important to remember that every step is worthwhile and that small steps all add up!
Caroline Harridence – Counting Clouds
Have a look at ACCA’s series of publications, where we explore the views of accountancy professionals on sustainability, develop detailed practical guidance to support SMEs in their sustainability journey, including the resources and tools that they need to take action, and showcase the examples of SMEs championing sustainability.
Our report, How SMEs can create a more sustainable world: A playbook for accountants in practice and finance teams in small and medium-sized organisations, details the benefits that sustainable actions can have for both business success and the environment. It sets out practical steps for embedding sustainable practices within organisations, provides case studies from across the world and links to a variety of tools and resources that can support SMEs and SMPs in their sustainability journey.