Smaller firms face net zero divide

New research has revealed the green transition is stalling for SMEs despite new regulations coming into force next year.

The report from banking group Aldermore also found that there is a growing ‘net zero divide’ in the SME community.

While one in four SME leaders are assessing their net zero goals (24%), the majority of SMEs remain in the early stages or are actively disengaged.

More than 80% say sustainability requirements feel like an active barrier to their business and many 58% have never heard of Scope 1, 2 and 3, which are pillars of future reporting frameworks.

The report says with new UK Sustainability Reporting Standards set to come into force from 2026 for some businesses, the research reveals a worrying stagnation in climate progress.

Lauren Pamma, Head of Energy and Infrastructure at Aldermore comments: “Our research shows genuine ambition among SMEs to decarbonise, but a lack of knowledge, resource and access to capital is holding many back.

“With reporting deadlines approaching, now is the time for government, industry and finance partners to step up their support.”