The urgency for climate action, coupled with changing regulations, has put increasing pressure on SMEs to accelerate climate action. The new mandatory ESG disclosure laws implemented in the UK and the EU means large corporations now have to measure and address their Scope 3 emissions. As SMEs are usually at the centre of corporate supply chains, they are increasingly being asked to provide data on their emissions. Banks both need this information and can support SMEs in supplying this data.
In a highly competitive market in which it’s hard to differentiate, banks can’t ignore the opportunity to establish themselves as a trusted partner for small business owners who are looking for greater transparency around their carbon footprint.
A recent survey by the SME Climate Hub highlighted the importance of improved planning and simplified action among small businesses who were committed to reducing their emissions, with 8 out of 10 small business participants considering reducing emissions “a high priority,” but only 60% having a sustainability strategy in place.
The survey revealed that the main blocker for small businesses when it comes to taking action is not knowing where or how to start. The reporting requirements are complex—even large businesses and carbon officers find it difficult and time-consuming.
Small businesses have repeatedly shown that they’re open to sharing data to enable personalised, simplified experiences in their operations. Banks that capitalise on this trend are able to provide value-added services that inspire long-term loyalty among small business customers and enable differentiation when it’s increasingly difficult to achieve.
There is an opportunity for banks to use SMEs' spend-based emissions data to provide businesses with an overview of their carbon emissions and send recommendations to help SMEs take action to reduce their footprint.
Beyond helping businesses reduce emissions, offering this solution can help drive engagement in the digital banking app. And customer acquisition—our research identified that 69% of SMEs want to be more environmentally friendly—banks that offer a carbon management solution will likely attract conscious customers.
Cogo helps banks worldwide turn customer data into personalised and engaging digital experiences, including nudging customers and businesses to understand, reduce and offset their carbon footprint—all within an existing digital experience.
Our Business Carbon Manager tool uses a spend-based approach to calculate carbon footprints, making reporting and analysis easy for businesses.
Business owners can see how their spending directly impacts their carbon footprint. And they can identify how to reduce their operational emissions.
Key Business Carbon Manager features:
Give your business customers what they really want: