ESG action downgraded as a priority by SMEs

By Azets

11 May 2022

●        71% of SMEs are not currently acting to reduce their carbon emissions

●        85% of SMEs are not currently measuring their carbon footprint

 Almost three quarters (71%) of SME businesses are not currently acting to reduce their carbon emissions, as Environmental, Social, and Governance (ESG) performance is downgraded and digitalisation, employee wellbeing, cost inflation, and recruitment take priority.

The latest Azets SME Barometer Spring 2022, which surveyed 1,093 SMEs from all sectors in the UK, Denmark, Finland, Norway, and Sweden, reveals ESG is on most company radars but specific action lacks urgency, with sharper focus on people, technology, and cost amid economic turbulence.

Over half of SMEs agree they have a good understanding of what ESG means (57%) and have the skills and competencies in the business to address it (52%).

However, 53% do not think ESG will have a big impact on their business in the next two years.

On reducing carbon emissions specifically, 71% are not currently acting and 85% are not currently measuring the carbon footprint of their business.

Meanwhile, over half (54%) of SMEs say they will increase digitalisation in the year ahead, whilst employee wellbeing has risen to be SMEs’ second highest priority, after securing their financial health.

Cost inflation and recruitment are SMEs’ biggest day-to-day challenges, with knock-on effects on cash flow and the time spent on administrative work.

Almost two-thirds (64%) of SMEs are struggling to recruit talent with the right skills.

All of this leaves little bandwidth and urgency for ESG.

Graham Rigby, Joint Regional Managing Partner at Azets in the North West, said: “The SME Barometer shows that many businesses want to focus on ESG and sustainability to a far greater extent than before. But it also highlights an alarming number that do not keep climate accounts today. There is a clear focus on digitalisation, cyber security, wellbeing, and costs, leading to a downgrading of ESG as a priority. This is the result of instability in the market forcing companies to prioritise differently than just a year ago.

“For some SMEs rooted in their local community, ESG appears as common sense. For others it poses challenges in terms of cost and the expertise and resources required to implement it. Given current pressures on SMEs, a basic challenge can simply be finding the time to bring ESG to the fore when there are more pressing matters to deal with.

“However, ESG represents a great potential and opportunity for SMEs. With legislation coming down the track for EU SMEs on sustainable products, and funding likely to be harder to come by as banks increasingly look at sustainability and ESG policies as a condition of lending, ESG is set to become an increasingly important theme. Businesses should be thinking ahead and taking specialist advice.”

ESG will be a key theme at the inaugural Global SME Leaders Growth Conference on 12 May 2022, which welcomes SME leaders to explore current challenges and opportunities. The Global SME Leaders Growth Conference will be hosted by Azets Group CEO Chris Horne and MD Azets Finland Ulla Nikkanen, with guest keynote speakers from Wired Magazine, The Gender Index, Bremont, and Digital Workplace. Register to join here.

Latest news

1

Call to recognise the ‘Now Generation’ of Lancashire leaders Sub36 event

Call to recognise the ‘Now Generation’ of Lancashire leaders

15 Jul 2025

2

Maya Ellis MP hails A582 upgrade funding as major step forward in tackling transport chaos Maya Ellis MP photo

Maya Ellis MP hails A582 upgrade funding as major step forward in tackling transport chaos

15 Jul 2025

3

TSS announce leadership appointments to drive continued growth James Austin, Alistair Bradley and Michael Collum

TSS announce leadership appointments to drive continued growth

15 Jul 2025

4

Date revealed for opening of entries for Red Rose Awards 2026 Red Rose Awards 2025

Date revealed for opening of entries for Red Rose Awards 2026

14 Jul 2025

5

Northcote celebrates marketing award for the 25th anniversary of Culinary Festival Obsession Northcotes winning awards

Northcote celebrates marketing award for the 25th anniversary of Culinary Festival Obsession

14 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
LBV123 July/August Launch Event
Lancashire Business View magazine launch
Networking
16 Jul 2025

LBV123 July/August Launch Event

Burnley College University Courses Building, Burnley, BB12 0AN

08:30 - 10:30

Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Shaping Preston's future by remembering its past
1750160034867.png.png
LBV Hub Networking
16 Jul 2025 - 16 Jul 2025

Shaping Preston's future by remembering its past

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 20:30

The Business Network Central & East Lancashire
LBV Hub Networking
17 Jul 2025 - 17 Jul 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Chamber Summer BBQ
LBV Hub Social
17 Jul 2025 - 17 Jul 2025

Chamber Summer BBQ

The Borough, Dalton Square, Lancaster, LA1 1PP

17:30 - 20:00

BNI presents Lancashire Speed Networking
1.png.png
LBV Hub Networking
17 Jul 2025 - 17 Jul 2025

BNI presents Lancashire Speed Networking

Chorley Football Club, Chorley, PR7 3DU

16:00 - 19:00

Preston Tech Connection: Web3 is Dead. Or is It?
July Longer Banner.jpg.jpg
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Web3 is Dead. Or is It?

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Advantage: AI – A Workshop for Business Leaders – August 14th
Navy--Event Tile.png.png
LBV Hub Seminars
14 Aug 2025 - 14 Aug 2025

Advantage: AI – A Workshop for Business Leaders – August 14th

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

09:00 - 12:00

The Business Network Central & East Lancashire
LBV Header (24).png.png
LBV Hub Networking
21 Aug 2025 - 21 Aug 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV122 Online Graphic
Subscribe now

Weekly news bulletin