The business imperative for carbon accounting in small business

Why small businesses need to start carbon accounting 

The Paris Agreement set the whole world into climate change action – but here in Aotearoa New Zealand, the impacts to small businesses are closer to home.

A big change for local businesses is the legislation making climate-related disclosures mandatory for large organisations. This legislation may seem targeted to the enterprise level but, when you investigate further, it impacts businesses of all sizes.

For example, if a small to medium sized business wants to do business with an organisation within the mandate confines, it’ll need to prove its sustainability efforts and results so that the larger business can assure theirs. Essentially, this new legislation means that as a country, we’re now changing how we ALL do business, no matter how big or small the business in question is.

What exactly does that mean for the approximately 530,000 small businesses registered in NZ?

If you’re interested in partnering with or supplying to a larger organisation impacted by the mandate, it’s time to start carbon accounting so you can ensure your CO2 emissions don’t disrupt their own, legally mandated reporting.

What is carbon accounting?  

Carbon accounting or GHG (greenhouse gas) accounting is a form of accounting used to understand carbon dioxide and equivalent emissions. The information gathered can be used in a variety of useful ways to understand, strategise, and report on how they’re tracking to meet and obtain corporate and legislative carbon reduction targets.

The benefits of carbon accounting for small businesses  

Until recently, carbon accounting was primarily performed by larger organisations, but recent legislation has created a reason for SMBs to pay attention too.

New laws require enterprise-sized businesses to provide reporting on their emissions, including those that they deal with in their supply chain. As a result, larger businesses are now frequently expecting accurate carbon reporting and accounting from their smaller suppliers.

While carbon accounting isn’t legally mandatory for all small businesses yet, by getting ahead of the pack, you’ll future-proof your business and help it to obtain an optimal market position.

And if you supply or service, or plan to supply or service, any government entities, then carbon accounting will be a key part of closing deals with them too.

The best methods of carbon accounting for small businesses

Even if you’re not planning on drafting up an RFP for a large government entity, there is still huge value in carbon accounting for SMEs, through improved efficiencies and attracting the ever-growing population of climate-conscious consumers.

But where do you start?

  • There’s little point doing carbon accounting if your tool doesn’t gather and report on genuinely accurate and meaningful data.
  • Ease of use. Let’s face it: SMEs rarely have a dedicated sustainability manager. A good carbon accounting tool for SMEs needs to be simple, easy, and fast to use, so you can draft up reports without having to spend hours in tutorials and training.
  • Carbon accounting is valuable for SMEs, but you don’t have the same budgets as the big businesses. Cost is always a factor to consider when building a business case for a carbon tool.

SMB market-specific carbon accounting tools like CarbonHUB are affordable solutions that give small to medium sized businesses the exact functionality required to quickly understand and report on their business’ emissions, helping them appease larger, mandated organisations.

Don’t let hindsight be your biggest blind spot, get on top your carbon accounting and future-proof your business. Learn more about the benefits of CarbonHUB and if it’s right for your SMB.