As many of us continue to deal with the effects of climate change, it’s essential to think about how things will change for small businesses, not just for our customers but also for our accounting and bookkeeping partners.
When Xero was started in 2006, accounting in the cloud was beginning to become the new way to do it. Accounting outsourcing firms and bookkeepers were excited and interested in what the cloud could do for them. Regarding the sustainability of small businesses, we’re at a very similar point on the adoption curve. Now that many companies are using the cloud and seeing its benefits, topics like waste and water management, carbon emissions, and electric vehicles are often discussed in conversations with colleagues and clients.
Even though these aren’t new ideas, small businesses need to think about them more and more. When small businesses have questions, who do they ask? Most of the time, it’s their advisor. In 2021, Xero did a study showing that 68% of small businesses want to be more sustainable, but many don’t know where to start.
What’s going on here?
Governments and businesses are setting goals to reduce carbon emissions over the next ten years. This affects the laws, and governments say that medium and large companies will have to follow them more in the future. As a result, small businesses may have to meet higher standards to get loans and government grants, and they may have to show that they are trying to be sustainable to be part of corporate supply chains.
Sixty-nine percent of employees say they are more likely to work for companies they think are good for the environment. This shows that employees are demanding better sustainability performance. Even though many consumers vote with their wallets, 71% of those who think traceability is essential are willing to pay more for brands that provide it, and 57% say they would change the way they shop to reduce their environmental footprint.
As a trusted advisor, this is where you can help your clients the most as they go through this change. Small businesses don’t have much time, but they have a lot of chances and jobs to do every day. In the same way that they rely on you to help them understand how their business is doing financially, sustainability is becoming an essential part of running a business, and they may need help and advice on this topic. For this reason small businesses outsource bookkeeping.
Where do the chances lie?
There are two ways to look at this chance. Sustainability can help your business reduce its carbon footprint, attract and keep good employees, and give clients another reason to choose you as their advisor.
Many frameworks, reporting standards, resources, and initiatives can help guide your efforts to be more sustainable. To understand what each of these things do, you need to know a lot about them and see the big picture. This is the skill that accountants and bookkeepers develop through years of experience, education, and growth in their jobs.
The other change is the real value you can add by helping your clients measure, report on, manage and reduce their sustainability footprints. The growing number of certifications and assurance requirements is a great example. As people who work in finance, you can use your data collection, verification, assurance, and auditing skills to help with carbon certification.
Small businesses are also thinking about the tools, technology, outsource accounting services and suppliers that can help them run in a more environmentally friendly way. You can help your clients make choices that are better for the environment and their business. For example, you can help them measure and manage their carbon footprint and choose energy providers who are ethical and care about the environment.
This is a great chance to find new ways to add value to your client’s businesses and offer new services. Many of these things will probably save your clients money, so you can help the environment and help their business at the same time.
What are other people already doing here?
Here are some of the types of services we’ve seen that have to do with sustainability:
• Sustainability audits: A thorough look at a client’s operations to find ways to improve them. The usual suspects are energy companies and companies that sell goods.
• Supply chain assessments: Look at a client’s top suppliers to see if there are cheaper and more environmentally friendly alternatives.
• Fleet transition support: Even though this is a new field, switching from cars with internal combustion engines to electric vehicles can benefit the environment.
• Carbon measurement, offsetting, management, auditing, and certification are growing fields similar to financial audits. You can use business data to find ways to make decisions and run more environmentally friendly operations.
• Active Transportation Policy Support: Helping your clients come up with employee benefits like subsidized public transportation and end-of-trip facilities is good for the environment and can get people more interested in their jobs.
Check out Accl Global to learn more about the sustainability options and resources available for small businesses, accountants, and bookkeepers.