• Ali Ahmed

Sustainability in the Middle Market

How Middle Market Companies can apply sustainability best practices from leading corporations


Sustainability news is typically dominated with stories from large, multi-national corporations making big renewables investments or launching huge green initiatives. But middle market companies, those with revenues less than $1B, face the same, if not more, risk and opportunity from sustainability issues. And even more importantly, if we want to achieve our global climate goals, we cannot exclude these companies as they comprise a significant portion of the global economy.

In the US alone, there are approximately 200,000 middle market companies creating over 25% of US economic revenue and employment. These companies must deal with the same pressures as larger companies:

  • Increasing regulation and regulatory requirements

  • Higher scrutiny from customers looking to reduce sustainability risk in their supply chains

  • Historically difficult employment market with employees looking to work for companies with purpose

  • Rapidly growing segment of investors only looking for opportunities which reflect not only solid financial returns, but promise to improve environmental or social indicators

And these pressures are only adding to the existing needs of smaller businesses to manage cost, brand reputation, and supply chain risk.


A middle market company cannot afford the sustainability infrastructure often implemented at large corporations with dedicated internal teams and external consultants. However, by focusing on three best practices from leading corporate sustainability teams, middle market companies can create a productive and cost-effective way to tackle their sustainability.


Focus on Material Topics

Companies, and particularly smaller companies, cannot be all things to all people. They must prioritize activity, resources, and money. The concept of materiality in sustainability is not new, and it does not require a significant investment or an outside consulting firm to

review a company's business against the key indicators of sustainability. A more in depth study could include:

  • Peer and industry benchmarking

  • Stakeholder interviews and surveys

  • Best practice survey

Mapping sustainability topics according to impact versus importance to stakeholders creates focus on the most material areas.


Reduce First

Reducing consumption is the most economical way to improve environmental footprint and limit exposure to future risk. By finding ways to reduce or eliminate the purchase of goods and services, there are direct and indirect benefits such as:

  • Avoided purchase and disposal costs

  • Reduced space and labor requirements

  • Streamlined supplier management and procurement practices

Creating a culture of minimization is not hard to achieve through awareness and simple process check-points where alternatives and options can be identified and reviewed.


Report

Smaller companies often do not create sustainability reports because the depth and detail included in large organization reports and their associated reporting standards are daunting.

Smaller companies don't need to follow every requirement and produce a huge report - even a few blog posts or a simple one-page document can still provide much of the same benefit. Having some type of sustainability information readily available and published:

  • Demonstrates authenticity

  • Builds a positive track record

  • Enhances brand

  • Explains intent

Staying focused on the material issues keeps a report brief, and incorporating data collection into the best practices of reducing consumption makes updating a report quick and easy.


For more information on how to incorporate sustainability best practices into your business, please reach out to us at contact@green-strategies.com





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