The key takeaways from this session
For small and medium-sized accounting practices (SMPs), sustainability has to be considered twice: once for your own practice, and a second time for your clients. That is: accountants should be looking for ways to make their own business sustainable, but also aiming to support and encourage sustainability in their clients’ work. But how can they do this?
This Practice Room discussion focused on how sustainability frameworks can help SMPs. “Sustainability is really about taking into account the long-term impacts of the decisions you make,” says Sarah Whale, discussion host and B-corp owner. “But it’s also broad, complex, and can seem quite daunting,” she added. “The most important thing you can do is to make a start, to take a step on that road.”
The session touched first on which sustainability reporting frameworks are available for what size of company. Sarah Whale, hosting the session, shared a table showing the various bases for reporting on sustainability, summarised in the table below:
“Sustainability for SMPs often starts with their own reporting,” says Whale. “For many SMPs, personalised goals and impact reports is going to be the first step, though they shouldn’t restrict their ambitions if they feel like they can tackle the tougher frameworks.
Sarah gives the example of her own company. “We try to report our business performance holistically - so we don’t just look at the financial side of things. Instead we report across multiple areas like employees, customers, and suppliers, and we do so with six goals in mind.” Those goals include a net zero target, providing a certain amount of training to each employee every year, making sure the majority of their supplier spend is local, and getting someone under 30 to act as a non-executive director of the company. “We try to keep it simple to reflect the fact that we’re a company of six people,” she explains.
Small and medium-sized companies may want to look at getting B-corp certification. B-corps are a new kind of business that balances purpose and profit. This certification signals to clients that you can help them with their sustainability requirements too.
“There’s a lot out there to choose from in terms of sustainability reporting, and as accountants we really need some form of harmonisation,” says Sarah. “But you can take a first step by considering your business values, perhaps by thinking about your work in the context of the UN SDGs.”
Accountants can help their clients with sustainability in more than one way, says Sarah. She argues that it isn’t just about reporting, but about using the reporting process to inform the client, and support and encourage them in their sustainability journey. Caroline Harridence agrees: “there’s some low-hanging fruit, especially with the management accounts and report. These are good starting points for discussing different types of data. The company often has this data, and they need to understand that reporting it, and including it sometimes in marketing materials is going to help them recruit talent, as well as showcase their sustainability.” She argues that especially the younger generation are looking for employers who can do more than just pay a wage. “Younger people are looking for businesses with clear purpose.”
Victoria Topham, a sustainability expert suggests, though, that it is important businesses are honest about their credentials. “Of every £100 that’s declared as spent on sustainability, around £75 goes into marketing material. That’s greenwashing, and the younger generation has cottoned on.”