Mauro Cozzi, CEO and Co-founder, Emitwise
As sustainability regulations tighten and customers demand greener supply chains, many small and medium-sized enterprises (SMEs) believe that decarbonisation is a challenge reserved for big corporations. SMEs make up 99.8% of all enterprises in the UK and provide almost 60% of private sector jobs. Yet, only 7.7% have formal sustainability reporting programmes. A recent survey by the SME Climate Hub also found that only 17% of SMEs had been asked to reduce their emissions by their corporate customers.
But the truth is, SMEs play a crucial role in decarbonisation, and procurement is one of the most effective tools to make a real impact. According to the CDP, Scope 3 emissions (those coming from your supply chain) are 26 times higher than their operational emissions. Therefore, even small procurement decisions can drive meaningful change.
Myths around the role of SMEs and procurement teams need to be busted, as in reality, all businesses can take the lead in reducing carbon emissions, regardless of their size. For SMEs looking to remain competitive, reduce costs, and meet growing sustainability expectations, the time to take action is now.
Myth 1: “SME Procurement Can’t Influence Carbon Emissions”
Reality: Every supplier choice affects your carbon footprint.
Procurement decisions have a direct impact on carbon emissions. Choosing a sustainable supplier, switching to low-carbon materials, or selecting a local partner instead of an overseas one, can all reduce your company’s environmental impact.
Sustainability is also becoming a competitive advantage. As part of their own decarbonisation efforts, many large companies now require suppliers (including SMEs) to provide carbon emissions data. If your business can’t demonstrate sustainability progress, you could risk losing contracts or missing out on new business opportunities.
A step SMEs can take is to start small, which involves carrying out internal audits to gather their own data, and creating an emissions baseline. This can be done in partnership with external experts too. Even minor shifts can lead to significant long-term emissions reductions.
Myth 2: “SMEs Lack the Resources to Measure Carbon Emissions”
Reality: Simple, low-cost methods do exist for SMEs to track and reduce emissions.
A common misconception is that tracking Scope 3 emissions is too complex or expensive for smaller businesses. However, accessible methods can help SMEs to start measuring their impact and accelerate their sustainability journey.
Here are two common methods SMEs can use to start tracking Scope 3 emissions:
- Spend-based: Estimates emissions based on spend data across different categories. It’s a quick and accessible approach, though less accurate. Still, it serves as a practical starting point for SMEs beginning their emissions tracking journey.
- Average data: Uses industry-wide emissions averages to estimate emissions. While this approach provides only a general benchmark, it’s a simple and practical way for SMEs to gauge their footprint.
For those further along, more accurate methods exist:
- Hybrid approach: Combines primary data (specific to the business) with secondary data (industry averages) for a more refined calculation.
- Supplier-specific data: Uses real emissions data from your suppliers, providing the most accurate tracking and helping build a more transparent supply chain.
SMEs don’t need perfect data to begin—what matters is taking the first step. As they progress, they can refine their approach and improve accuracy over time. A simple first step is asking key suppliers for their emissions data. If they don’t have it, encourage them to start tracking—it benefits both your business and theirs.
Free resources, such as the SME Climate Hub, offer practical guidance and easy-to-use tools tailored for smaller businesses. By taking small, manageable steps, SMEs can gain valuable insights into their emissions.
Myth 3: “SMEs Have No Control Over Supplier Emissions”
Reality: SMEs can work with suppliers to drive sustainability improvements.
Many SMEs assume that only large companies can influence suppliers, but the truth is smaller businesses have more power than they think, as SMEs make up for over 90% of businesses worldwide. Suppliers are increasingly willing to provide sustainability data and adopt greener practices—especially if their customers ask for it.
A practical way for SMEs to engage their existing partners is through segmenting them based on their sustainability progress:
- Sustainability Leaders: Suppliers who already provide verified emissions data.
- Improving Suppliers: Those working towards better emissions tracking.
- Newcomers to Sustainability: Suppliers who may need education and support.
SMEs don’t need to demand perfection from their suppliers right away. Instead, working together through education, training, and gradual improvements helps build stronger, more resilient partnerships while reducing emissions.
Even small actions—like asking for emissions data or discussing sustainability goals—can influence suppliers and contribute to long-term emissions reductions.
Myth 4: “Sustainable Procurement Is Just for Large Corporations”
Reality: SMEs that embrace sustainability gain a competitive edge.
While big companies face strict sustainability regulations like the EU Corporate Sustainability Reporting Directive (CSRD), SMEs are not exempt from market pressures. More and more, customers, investors, and larger clients are demanding sustainability from all businesses—including SMEs.
The benefits of embedding sustainability into procurement go beyond compliance:
- Cost savings – Sustainable suppliers often offer energy-efficient or waste-reducing solutions that lower costs.
- New business opportunities – Increasingly large enterprises are prioritising suppliers who track and reduce emissions.
- Stronger reputation – Customers and investors are increasingly choosing businesses with a sustainability focus.
- Long-term resilience – Reducing emissions helps future-proof your business against stricter regulations.
Even if your business isn’t legally required to report emissions, proactively tracking and reducing them will make you a more attractive supplier and employer.
The Bottom Line
The idea that procurement teams in SMEs aren’t responsible for decarbonisation is a myth. In reality, SMEs are at the heart of sustainable supply chains, and their procurement decisions can in fact make a huge impact.
By taking small, practical steps—such as gathering emissions data, and engaging with suppliers on sustainability, and making gradual improvements—SMEs can not only reduce their carbon footprint, but also gain a competitive advantage, cut costs, and secure their place in a low-carbon economy.
Sustainability isn’t just for big businesses. SMEs have the power to lead real change—starting with procurement.
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