Sustainable Innovative Business Management Training Handbook for Micro-SMEs PDF

Micro-SME oriented sustainable innovative business management training -- SIBMT 2022-2-BG01-KA210-VET-000091735 KA210-VET - Small-scale partnerships in vocational education and training **Sustainable innovative business management training handbook for micro-SMEs** Funded by the European Union. Views and opinions expressed are however those of the author(s) only and do not necessarily reflect those of the European Union or the European Education and Culture Executive Agency (EACEA). Neither the European Union nor EACEA can be held responsible for them. Content Table of contents {#table-of-contents.ListParagraph.TOCHeading} ================= [1. Sustainable management 7](#sustainable-management) [1.1 What is sustainable management? 7](#what-is-sustainable-management) [1.2 Why is sustainability important? 11](#why-is-sustainability-important) [1.2.1 Environmental protection 11](#environmental-protection) [1.2.2 Social responsibility 12](#social-responsibility) [1.2.3 Global challenges with a local impact 13](#global-challenges-with-a-local-impact) [1.3 Benefits of sustainable management? 16](#benefits-of-sustainable-management) [1.3.1 Cost savings 16](#cost-savings) [1.3.2 Improved reputation 17](#improved-reputation) [1.3.3 Access to new markets 18](#access-to-new-markets) [1.3.4 Regulatory compliance 20](#regulatory-compliance) [1.3.5 Increased employee engagement (role of Human Resources department) 22](#increased-employee-engagement-role-of-human-resources-department) [1.3.6 Reduced environmental impact 23](#reduced-environmental-impact) [1.3.7 Improved durability 23](#improved-durability) [1.4 The challenges of sustainable management 24](#the-challenges-of-sustainable-management) [1.4.1 Limited resources 24](#limited-resources) [1.4.2 Lack of expertise 26](#lack-of-expertise) [1.4.3 Limited market access 27](#limited-market-access) [1.4.4 Limited impact on suppliers 28](#limited-impact-on-suppliers) [1.4.5 Limited regulatory support 29](#_Toc181190526) [1.5 Sustainable management in all its dimensions, focusing on real-life problems 31](#sustainable-management-in-all-its-dimensions-focusing-on-real-life-problems) [1.5.1 3 main pillars of development 31](#main-pillars-of-development) [1.6 Sustainability assessment 33](#sustainability-assessment) [1.6.1 Scope and limits 36](#scope-and-limits) [1.6.2 Identify key sustainability issues 37](#identify-key-sustainability-issues) [1.6.3 Data collection and analysis 38](#data-collection-and-analysis) [1.6.4 Stakeholder engagement 39](#stakeholder-engagement) [1.6.5 Setting goals and objectives 39](#setting-goals-and-objectives) [1.6.6 Action planning 39](#action-planning) [1.6.7 Monitoring and reporting 40](#monitoring-and-reporting) [2. What is an environmental management system and why should you implement it in your company? (The Plan-Do-Check-Act model and ISO 14001) 41](#what-is-an-environmental-management-system-and-why-should-you-implement-it-in-your-company-the-plan-do-check-act-model-and-iso-14001) [2.1 Improve environmental performance 45](#_Toc181190539) [2.2 Increase efficiency 45](#increase-efficiency) [2.3 Ensure compliance 46](#ensure-compliance) [2.3.1 How EMS Facilitates Compliance 47](#how-ems-facilitates-compliance) [2.3.2 Reducing the Risk of Fines and Penalties 47](#reducing-the-risk-of-fines-and-penalties) [2.4 Reputation improvement 48](#reputation-improvement) [2.5 Engage employees 48](#engage-employees) [2.6 Identify opportunities for innovation 49](#identify-opportunities-for-innovation) [2.7 Meet stakeholder expectations 51](#meet-stakeholder-expectations) [3. Climate change risk management 54](#climate-change-risk-management) [3.1 Risk identification 57](#_Toc181190550) [3.2 Risk Assessment 58](#risk-assessment) [3.3 Develop a climate risk management plan 61](#develop-a-climate-risk-management-plan) [3.4 Implementing business continuity plans 63](#implementing-business-continuity-plans) [3.5 Risk reduction 64](#risk-reduction) [3.6 Transfer of risk 66](#transfer-of-risk) [3.7 Risk communication 68](#risk-communication) [3.8 Engaging suppliers and customers 69](#engaging-suppliers-and-customers) [3.9 Monitoring and evaluation 70](#monitoring-and-evaluation) [4. Optimising sustainable and responsible business practices. 72](#optimising-sustainable-and-responsible-business-practices.) [4.1 Improving the efficiency of energy management through technological improvements 72](#_Toc181190561) [4.2 Alternative energy sources 75](#alternative-energy-sources) [4.3 Digital transformation 79](#digital-transformation) [4.3.1 Basic and Advanced Digital Technologies (IoT, Blockchain, Next Generation Internet) 81](#basic-and-advanced-digital-technologies-iot-blockchain-next-generation-internet) [4.4 Reducing emissions 88](#reducing-emissions) [4.4.1 Conducting emissions inventory 88](#conducting-emissions-inventory) [4.4.2 Set emission reduction targets 92](#set-emission-reduction-targets) [4.4.3 Implementation of energy efficient practices 92](#implementation-of-energy-efficient-practices) [4.4.4 Increase the use of renewable energy 94](#increase-the-use-of-renewable-energy) [4.4.5 Optimisation of transport 96](#optimisation-of-transport) [4.4.6 Promoting sustainable practices among employees and suppliers 97](#promoting-sustainable-practices-among-employees-and-suppliers) [4.4.7 Monitoring and reporting progress 98](#monitoring-and-reporting-progress) [4.5 Principles of circular economy 99](#principles-of-circular-economy) [4.5.1 Green/ Reverse logistics 101](#green-reverse-logistics) [4.5.2 Dynamic and efficient supply chains (circular supply chains) 102](#dynamic-and-efficient-supply-chains-circular-supply-chains) [4.5.3 Sustainable storage 105](#sustainable-storage) [4.6 Effective waste management 117](#effective-waste-management) [4.6.1 Estimate waste generation 117](#estimate-waste-generation) [4.6.2 Implementation of waste reduction strategies 118](#implementation-of-waste-reduction-strategies) [4.6.3 Implementation of recycling programs 122](#implementation-of-recycling-programs) [4.6.4 Implementation of composting programs 124](#implementation-of-composting-programs) [4.6.5 Hazardous waste disposal services 125](#hazardous-waste-disposal-services) [4.6.6 Employee engagement 128](#employee-engagement) [4.6.7 Monitoring and reporting progress 129](#monitoring-and-reporting-progress-1) [4.7 Improving infrastructure resilience 130](#improving-infrastructure-resilience) [4.7.1 Conducting an infrastructure audit 130](#conducting-an-infrastructure-audit) [4.7.2 Installation of energy efficient lighting and equipment 132](#installation-of-energy-efficient-lighting-and-equipment) [4.7.3 Implementation of water conservation measures 134](#implementation-of-water-conservation-measures) [4.7.4 Use sustainable building materials 137](#use-sustainable-building-materials) [4.7.5 Implementation of green transport strategies 139](#implementation-of-green-transport-strategies) [4.7.6 Engagement of suppliers 139](#engagement-of-suppliers) [4.8 Workplace resources and employee resilience 140](#workplace-resources-and-employee-resilience) [4.8.1 Provide a safe and healthy work environment 140](#provide-a-safe-and-healthy-work-environment) [4.8.2 Implementation of work-life balance policies 143](#implementation-of-work-life-balance-policies) [4.8.3 Providing training and development opportunities 146](#providing-training-and-development-opportunities) [4.8.4 Employee mental health support 151](#employee-mental-health-support) [4.8.5 Encouraging employee engagement and participation 153](#encouraging-employee-engagement-and-participation) [4.8.6 Encourage teamwork and cooperation 155](#encourage-teamwork-and-cooperation) [4.8.7 Measuring and reporting progress 157](#measuring-and-reporting-progress) [5. Green marketing 159](#green-marketing) [5.1 Definition of Green Marketing 159](#_Toc181190602) [5.2 Defining a sustainability strategy 160](#defining-a-sustainability-strategy) [5.3 Benefits of Green Marketing 161](#benefits-of-green-marketing) [5.4 Challenges of Green Marketing 162](#challenges-of-green-marketing) [5.5 Participation in green certifications 163](#participation-in-green-certifications) [5.6 Use environmentally friendly packaging 165](#use-environmentally-friendly-packaging) [5.7 Support for green initiatives 166](#support-for-green-initiatives) [5.8 Use of social media 166](#use-of-social-media) [5.9 Monitoring and reporting progress 167](#monitoring-and-reporting-progress-2) [6. Sustainability as a catalyst for innovation and new market opportunities 168](#sustainability-as-a-catalyst-for-innovation-and-new-market-opportunities) [6.1 Developing your social innovation 168](#_Toc181190613) [6.2 Defining social and environmental challenges 170](#defining-social-and-environmental-challenges) [6.2.1 Steps for defining the social and environmental challenges 171](#steps-for-defining-the-social-and-environmental-challenges) [6.3 Stakeholder engagement 172](#stakeholder-engagement-1) [6.4 Collaboration with partners 173](#collaboration-with-partners) [6.4.1 The importance of collaborative partnerships 173](#the-importance-of-collaborative-partnerships) [6.4.2 Strategies for effective collaboration 174](#strategies-for-effective-collaboration) [6.4.3 Examples of successful collaborations 174](#examples-of-successful-collaborations) [6.5 Use design thinking 174](#use-design-thinking) [6.5.1 The process of design thinking 175](#the-process-of-design-thinking) [6.5.2 Practical application of design thinking 175](#practical-application-of-design-thinking) [6.6 Impact measurement 176](#impact-measurement) [6.7 Communicate social innovation 177](#communicate-social-innovation) [6.7.1 Crafting the message 177](#crafting-the-message) [6.7.2 Channels of communication 177](#channels-of-communication) [6.7.3 Transparency and authenticity 177](#transparency-and-authenticity) [6.7.4 Examples of communicating social innovation 178](#examples-of-communicating-social-innovation) [6.8 Create a culture of social innovation 178](#create-a-culture-of-social-innovation) [6.8.1 Practical applications of creating a culture of social innovation 179](#practical-applications-of-creating-a-culture-of-social-innovation) [7. Strategies for a sustainable future 180](#strategies-for-a-sustainable-future) [7.1 Introduction 180](#_Toc181190634) [7.2 Understanding sustainability in the context of Micro-SMEs 180](#understanding-sustainability-in-the-context-of-micro-smes) [7.3 Regulatory and market Influences 181](#regulatory-and-market-influences) [7.4 Sustainable business models for micro-SMEs 185](#sustainable-business-models-for-micro-smes) [7.4.1 Product Service Systems (PSS) 185](#product-service-systems-pss) [7.4.2 Business models for reuse and recycling 187](#business-models-for-reuse-and-recycling) [7.4.3 Demand-side management 188](#demand-side-management) [7.4.4 Circular Economy, Shared Value, and Social Entrepreneurship Models 190](#circular-economy-shared-value-and-social-entrepreneurship-models) [7.4.5 Practical Steps for Integrating These Models into Existing Business Practices 190](#practical-steps-for-integrating-these-models-into-existing-business-practices) [7.5 Innovation and technology in sustainability 192](#innovation-and-technology-in-sustainability) [7.6 Financial strategies and funding opportunities 194](#financial-strategies-and-funding-opportunities) [7.6.1 Guidance on financial planning with a sustainability focus. 194](#guidance-on-financial-planning-with-a-sustainability-focus.) [7.6.2 Information on grants, subsidies, and funding available in Europe for sustainable projects. 195](#information-on-grants-subsidies-and-funding-available-in-europe-for-sustainable-projects.) [7.6.3 Tips on attracting investment by highlighting the sustainability angle 196](#tips-on-attracting-investment-by-highlighting-the-sustainability-angle) [7.7 Building a culture of sustainability 198](#building-a-culture-of-sustainability) [7.7.1 Strategies for fostering a corporate culture that embraces sustainability 198](#strategies-for-fostering-a-corporate-culture-that-embraces-sustainability) [7.7.2 Continuous learning and improvement 199](#continuous-learning-and-improvement) [7.8 Monitoring, reporting, and continuous improvement 201](#monitoring-reporting-and-continuous-improvement) [7.8.1 Tools and techniques for measuring sustainability performance 201](#tools-and-techniques-for-measuring-sustainability-performance) [7.8.2 Importance of transparency in sustainability efforts through reporting 201](#importance-of-transparency-in-sustainability-efforts-through-reporting) [7.8.3 Continuous improvement practices to enhance sustainability outcomes over time 201](#continuous-improvement-practices-to-enhance-sustainability-outcomes-over-time) [8. Examples of SMEs that have improved their resilience. 203](#examples-of-smes-that-have-improved-their-resilience.) [8.1 United Kingdom 203](#_Toc181190657) [8.2 Germany 203](#germany) [8.3 France 203](#france) [8.4 Greece 204](#greece) [8.5 Cyprus 204](#cyprus) [8.6 Bulgaria 205](#bulgaria) Table of figures {#table-of-figures.ListParagraph.TOCHeading} ================ [Figure 1: UN\'s 17 Sustainable Development Goals (SDGs) 8](#_Toc181190663) [Figure 2: Three main pillars of development (social, economic and environmental) 32](#_Toc181190664) [Figure 3: Plan-Do-Check-Act (PDCA) model 42](#_Toc181190665) [Figure 4: Repetitive environmental management system (EMS) 45](#_Toc181190666) [Figure 5: Linear economy 99](#_Toc181190667) [Figure 6: The circular economy 100](#_Toc181190668) [Figure 7: Just-in-Time Management (JIT) 107](#_Toc181190669) [Figure 8: Waste reduction strategies 119](#_Toc181190670) Tables {#tables.ListParagraph.TOCHeading} ====== [Table 1: Risk assessment 58](#_Toc181190671) [Table 2: The benefits and disadvantages of solar thermal energy and photovoltaic solar energy 77](#_Toc181190672) [Table 3: Examples of digital technologies 80](#_Toc181190673) [Table 4: Greenhouse gas inventory report template 90](#_Toc181190674) [Table 5: Carbon dioxide emissions released during energy production per kilowatt hour (kWh) 94](#_Toc181190675) [Table 6: Two main types of inventory control systems 111](#_Toc181190676) [Table 7: Hazardous waste types 126](#_Toc181190677) [Table 8: Differences between more energy efficient bulbs compared to electric bulbs 133](#_Toc181190678) [Table 9: The most frequently applied types of training, SMEs 148](#_Toc181190679) Sustainable management ====================== What is sustainable management? ------------------------------- Sustainable management is an approach to managing an organisation\'s operations, processes and products in a way that meets the needs of the present without compromising the ability of future generations to meet their own needs. This includes considering the environmental, social and economic impacts of the organisation\'s activities and working to minimise any negative impacts while maximising the positive ones. Sustainable management recognises that businesses do not exist in isolation and that they have a responsibility to consider the impact of their operations on the wider community and the planet. This includes a commitment to sustainable practices such as energy efficiency, waste reduction, responsible sourcing and social responsibility, among others. Sustainable management is becoming increasingly important as businesses and consumers realise the need to address environmental and social challenges such as climate change, resource depletion and social inequality. By adopting sustainable management practices, organisations can reduce their environmental impact, improve their bottom line and contribute to a more sustainable future. Regardless of their size and type, SMEs can benefit significantly from adopting sustainable business practices as they can be considered the backbone of the economy. There are over 23 million SMEs in the EU, which account for around 60% of the Union\'s GDP and provide 67% of all jobs in the private sector.[^1^](#fn1){#fnref1.footnote-ref} As such, they also embody huge energy saving potential for the EU. As awareness of ESG (company environmental, social and governance performance) gains momentum, bringing sustainability into SME management becomes essential and has a critical role to play in company growth. The reasons that drive companies to implement sustainability in their management are the following:[^2^](#fn2){#fnref2.footnote-ref} - Raising public awareness of environmental issues - Media exposure regarding the ethical practices and impacts of businesses - Emerging legislation, regulations and standards requiring transparency - Sustainability reporting - Changing customer attitudes Sustainable governance is largely linked to the United Nations\' Sustainable Development Goals (SDGs), as it represents a framework for achieving sustainable development at the global level. The 17 goals adopted by the United Nations in 2015 aim to end poverty and human deprivation, while also including strategies to improve health, education and stimulate economic growth through climate and biodiversity action.[^3^](#fn3){#fnref3.footnote-ref} Most businesses benefit from following the SDGs, through which they can approach a number of benefits -- learning new skills, resources and innovation.[^4^](#fn4){#fnref4.footnote-ref} Creative approaches, know-how, technology and financial resources are needed to achieve the SDGs.[^5^](#fn5){#fnref5.footnote-ref} ![](media/image2.png) []{#_Toc181190663.anchor}Figure 1: UN\'s 17 Sustainable Development Goals (SDGs) The UN\'s 17 Sustainable Development Goals (SDGs) are interrelated and can be linked to sustainable governance in different ways. Examples of this are: - **Goal 1**: No Poverty -- Sustainable governance can help address poverty by creating jobs, promoting economic growth and ensuring access to basic services such as education, health and clean water. Applying a strict non-discrimination policy, hiring people from the local community, integrating people living in poverty are ways to achieve this. - **Goal 2**: Zero Hunger -- Sustainable management practices can increase agricultural productivity, reduce food waste and ensure food security for all. - **Goal 3**: Good health and well-being - Sustainable governance can promote healthy lifestyles, reduce air and water pollution and ensure access to health facilities. Business owners can help achieve that goal by providing health benefits, insurance and free annual check-ups for their employees. - **Goal 4**: Quality Education -- Sustainable governance can support education by investing in schools, promoting gender equality and ensuring access to educational resources. Within the business, work can be done to provide training aimed at improving the skills of employees, creating work and training programs. - **Goal 5**: Gender Equality - Sustainable governance can promote gender equality by creating equal opportunities for men and women, eliminating gender-based discrimination and supporting women\'s empowerment. - **Goal 6**: Clean water and sanitation - Sustainable management can ensure access to safe and clean water, improve sanitation and promote water conservation. Businesses can work to improve water efficiency, introduce water-saving practices into company policy, ban chemicals that would negatively affect water quality if improperly disposed of. - **Goal 7**: Affordable and clean energy - Sustainable management can promote the use of renewable energy sources such as solar and wind, reduce energy consumption and promote energy efficiency by optimising lighting, heating and cooling in company buildings/spaces. - **Goal 8**: Decent work and economic growth - Sustainable governance can promote job creation, economic growth and social development through sustainable business practices such as: providing apprenticeship opportunities among employees, especially an entrepreneurial culture, implementing a strict policy on disloyalty employment practices. - **Goal 9**: Industry, innovation and infrastructure - Sustainable governance can promote innovation, invest in sustainable infrastructure and support sustainable industrial development. Particular attention to innovation is associated with providing a platform for stakeholders to propose and develop creative solutions to reduce the challenges guaranteed by regular regulation and sustainable management. - **Goal 10**: Reduced Inequalities - Sustainable governance can promote inclusive economic growth, reduce income inequality and promote social inclusion, by investing in activities that help eradicate poverty, partnering with civil society networks to provide education and training for entrepreneurial skills. - **Goal 11**: Sustainable cities and communities - Sustainable governance can promote sustainable urbanisation (participation in a sustainable community aimed at improving urban functionality and sustainability used in public transport services), reduce the environmental impact of cities and improve access to basic services. - **Goal 12**: Responsible consumption and production - Sustainable governance can promote sustainable patterns of consumption and production, reduce waste and pollution and promote resource efficiency. - **Goal 13**: Climate action - Sustainable governance can promote climate action by reducing greenhouse gas emissions, promoting renewable energy and supporting climate adaptation measures. - **Goal 14**: Life under the water - Sustainable management can promote the conservation and sustainable use of marine resources, reduce marine pollution and protect marine ecosystems. Businesses that strive for sustainability can contribute to the goal by establishing and following a strict policy regarding waste that can have a negative impact on water quality and the marine environment, creating a database of information on the use of chemicals and materials. - **Goal 15**: Life on land - The sustainable management of and promote the conservation and sustainable use of terrestrial ecosystems, reduce deforestation and desertification and protect biological diversity. Measuring and mitigating negative impacts on the environment and ecosystems, implementing environmental and social guarantees for the use of raw materials and goods contribute to this - **Goal 16**: Peace, justice and strong institutions - Sustainable governance can promote peaceful and inclusive societies, strengthen institutions and promote access to justice. - **Goal 17**: Partnerships for the Goals - Sustainable governance can foster partnerships between governments, the private sector, civil society and other stakeholders to achieve the SDGs and ensure sustainable development. A number of international sustainability management standards can help SMEs as they provide guidelines and frameworks for improving and reporting enterprise sustainability. Some of them are: - ISO 14001: Environmental Management System (EMS) -- provides a systematic framework for SMEs to manage environmental impact and comply with legal requirements - Global Reporting Initiative (GRI) Standards -- can help SMEs report on their sustainability performance in a standardised and reliable way. - Sustainability Accounting Standards Board (SASB) Standards -- provide MSPs with customised sustainability guidelines based on the sector in which they operate. - Task Force on Climate-related Financial Disclosures (TCFD) Recommendations -- contain recommendations to companies related to climate change, aimed at better understanding and disclosure of risks and opportunities related to it. - Carbon Disclosure Project (CDP) Reporting -- helps SMEs minimise their environmental impact, manage and reduce their climate risks, improve their sustainability performance, reputation and access to capital. - United Nations Global Compact (UNGC) Principles -- helps small businesses demonstrate their commitment to sustainability, improve their reputation and access to markets. - Equator Principles for project finance -- a framework for managing environmental and social risks - The Natural Capital Protocol - a decision-making framework to help businesses identify, measure and evaluate their direct and indirect impacts on the environment. - Forest Stewardship Council (FSC) -- FSC certification provides a mechanism to engage MFA in responsible forest management and sustainability. - Marine Stewardship Council (MSC) Certification -- provides a mechanism to manage sustainable fishing practices Relevant videos: - [[https://www.youtube.com/watch?v=YpRZl8snhOc]](https://www.youtube.com/watch?v=YpRZl8snhOc) Why learn about sustainability? - [[https://www.youtube.com/watch?v=\_6eWgDxJW\_Y]](https://www.youtube.com/watch?v=_6eWgDxJW_Y) The New Sustainability Champions - [[https://www.youtube.com/watch?v=3WODX8fyRHA]](https://www.youtube.com/watch?v=3WODX8fyRHA) What Is Sustainable Development? - [[https://www.youtube.com/watch?v=Y5fR\_KAVRMo]](https://www.youtube.com/watch?v=Y5fR_KAVRMo) Sustainable Business \| Frank Wijen \| TEDxErasmusUniversityRotterdam - [[https://www.youtube.com/watch?v=Djq3zlbCNrI]](https://www.youtube.com/watch?v=Djq3zlbCNrI) What is a Sustainable Business? (The Problem with NOT Defining Sustainable Business) - [[https://www.youtube.com/watch?v=ecGzrUHFJpg]](https://www.youtube.com/watch?v=ecGzrUHFJpg) Introduction to Sustainable Business Strategy - [[https://www.youtube.com/watch?v=2f5m-jBf81Q]](https://www.youtube.com/watch?v=2f5m-jBf81Q) Triple bottom line (3 pillars): sustainability in business - [[https://www.youtube.com/watch?v=azM4n0zf4jw]](https://www.youtube.com/watch?v=azM4n0zf4jw) Sustainable business: It\'s not just about the why \| Jeremy Moon \| TEDxScottBase Why is sustainability important? -------------------------------- ### Environmental protection Sustainability helps protect the planet by reducing the impact of human activities on the environment. By implementing sustainable practices, we can reduce greenhouse gas emissions, conserve natural resources, and protect ecosystems and biodiversity. In the last 50 years, humans have had the greatest impact on the environment than any other period in human history. This impact on ecosystems has contributed to significant net gains for human well-being and economic development, but has resulted in the degradation of many ecosystem services. Nowadays humanity lives in the so-called \"environmental credit\" -- we consume 25% more than the planet\'s regenerative capacity.[^6^](#fn6){#fnref6.footnote-ref} The only way for the regenerative capacity of the planet\'s ecosystems to be irreversibly impaired is to introduce sustainable management of resources and ecosystem services. To a large extent, the harmful effects on the environment such as melting of the polar ice, global warming, pollution of air, water and soil, loss of biodiversity are caused due to the impact of the developing industry. Industrial improvements related to sustainable management that aim to reduce these impacts can be considered in two eras over a twenty-year period.[^7^](#fn7){#fnref7.footnote-ref} In the first era, called \"resistant adaptation\" starting from 1970, the enterprises of the industrial sector faced demands to improve their management, through various regulations from the governments.[^8^](#fn8){#fnref8.footnote-ref} These regulations have their benefits in dealing with their environmental impacts, but they are not enough, thus ushering in the second era -- that of sustainability. The sustainability approach is enshrined in the [[Brutland Commission\'s Our Common Future report]](https://sustainabledevelopment.un.org/content/documents/5987our-common-future.pdf)[^9^](#fn9){#fnref9.footnote-ref}. It emphasises the need for economic and sound development and at the same time emphasises the importance of environmental protection. Subsequently, many companies implemented a strategic approach to their management that reduced the risks that arose - government sanctions, competition, public outrage and employee problems.[^10^](#fn10){#fnref10.footnote-ref} The second era, especially after the spread of the Internet helped to raise public awareness of the problems associated with anthropogenic pollution. Because of this, many of the big companies have taken measures to reduce their harmful impact. The impact of SMEs on the environment should not be overlooked either. Studies show that in Europe approximately 64% of industrial pollution is caused by these enterprises, and only 24% of SMEs apply practices to reduce their impact on the environment.[^11^](#fn11){#fnref11.footnote-ref} Currently, green management and the principles of the circular economy are increasingly entering the management of SMEs and are an important aspect for maintaining the competitiveness of enterprises in the future. Relevant videos: - [[https://www.youtube.com/watch?v=mZYhKM43Uqw]](https://www.youtube.com/watch?v=mZYhKM43Uqw) - How and why is the environment protected? - BBC Learning English - [[https://www.youtube.com/watch?v=5F1dvTR8pxo]](https://www.youtube.com/watch?v=5F1dvTR8pxo) - The protection of wild species in the EU - [[https://www.youtube.com/watch?v=pLfEVTxD0RY]](https://www.youtube.com/watch?v=pLfEVTxD0RY) - S. Korean green companies adopt eco-friendly systems to protect environment ### Social responsibility Sustainability promotes social responsibility by ensuring that businesses operate in a way that is fair and just to all stakeholders, including employees, customers and local communities. This includes respect for human rights, fair labour practices and community engagement. As the EU does not oblige SMEs to report on their corporate social responsibility (CSR), few of them understand the concept and the benefits it provides.[^12^](#fn12){#fnref12.footnote-ref} However, a package of legislative changes for sustainable finance and economic growth is envisaged to oblige all companies (except micro-enterprises) registered and regulated by European markets to report on their ESG activities (environmental, social and corporate governance).[^13^](#fn13){#fnref13.footnote-ref} Depending on whether companies prepare such reports voluntarily, their rating in the financial market will be affected, as financing of companies that do not prepare ESG reports will be considered riskier.[^14^](#fn14){#fnref14.footnote-ref} The implementation of CSR can be associated with the following benefits:[^15^](#fn15){#fnref15.footnote-ref} - increasing employee engagement - increasing customer loyalty - a growing source of innovation. - accelerating the exchange of valuable external information between stakeholders[^18^](#fn18){#fnref18.footnote-ref} - identifying new business opportunities from social needs[^19^](#fn19){#fnref19.footnote-ref} - increasing employee participation[^20^](#fn20){#fnref20.footnote-ref} Relevant video: - [[https://www.youtube.com/watch?v=AkbGz3CYvqE]](https://www.youtube.com/watch?v=AkbGz3CYvqE) Environmental, Social and Governance (ESG) \| Overview and Framework - [[https://www.youtube.com/watch?v=Z5KZhm19EO0]](https://www.youtube.com/watch?v=Z5KZhm19EO0) The social responsibility of business \| Alex Edmans \| TEDxLondonBusinessSchool - [[https://www.youtube.com/watch?v=N8dXNzCIVxg]](https://www.youtube.com/watch?v=N8dXNzCIVxg) The Era of Corporate Social Responsibility is Ending \| Rachel Hutchisson \| TEDxWilmington - [[https://www.youtube.com/watch?v=wTidplpkqZE]](https://www.youtube.com/watch?v=wTidplpkqZE) What Corporate Social Responsibility (CSR) Has Become \| Simon Sinek - [[https://www.youtube.com/watch?v=p2iQ\_h1mPaY]](https://www.youtube.com/watch?v=p2iQ_h1mPaY) Why Corporate Social Responsibility Matters - [[https://www.youtube.com/watch?v=714H4-NcC0Q]](https://www.youtube.com/watch?v=714H4-NcC0Q) Sustainability. It\'s the future. - [[https://www.youtube.com/watch?v=93xsgViijTc]](https://www.youtube.com/watch?v=93xsgViijTc) Generosity, The Sustainable Business Strategy of the Future \| Cindy Norcott \| TEDxGreshamPlace ### Global challenges with a local impact Sustainability is essential to address global challenges such as climate change, resource depletion and social inequality. By adopting sustainable practices, we can work towards a fairer and more sustainable world. The most serious global challenges facing humanity today are: - Climate changes - Climate change negatively affects the key living conditions of people and ecosystems, as well as social and economic development. - Society\'s and business\'s goals for economic progress affect the emissions of greenhouse gases that cause climate change. - Biodiversity loss - land use changes for large-scale food production. - overexploitation -- overfishing and fishing, use of wood material (deforestation) - climate change and pollution of natural resources (water, air, soil) - transfer of invasive (foreign to local flora and fauna) species - Water shortage - Food insecurity - Waste management - Social inequality - creating new economic opportunities and jobs, especially in the renewable energy, ecotourism and sustainable agriculture sectors - promoting socially responsible business practices (fair labour practices, ethical supply chains and engagement, etc.) - contributing to the promotion of environmental justice and thus people\'s access to a healthy environment - promoting stakeholder engagement, including that of marginalised communities - promoting inclusive economic growth Benefits of sustainable management? ----------------------------------- ### Cost savings Sustainable management practices, such as energy efficiency measures, waste reduction and water conservation, can help SMEs reduce their operating costs and improve their bottom line. Cost savings can be achieved by introducing measures to improve resource efficiency. The efficient use of resources, in addition to cost savings, is also associated with great potential for increasing productivity. It includes:[^39^](#fn39){#fnref39.footnote-ref} - selection of raw materials and energy resources, - reducing waste, emissions and risks, - resource reuse, - careful management of materials and energy flows in production processes, - analysis and improvement of the product life cycle (use, recycling and disposal). Achieving improved resource efficiency will require changes in product design, manufacturing processes and marketing activities. Reducing the energy, water, land and materials that are used for business needs is related to reducing the costs that a business has. It is estimated that better use of resources could save European industry €630 billion in one year.[^40^](#fn40){#fnref40.footnote-ref} In addition, there are other benefits of making such efforts for the environment, such as reducing emissions, as well as limiting the harmful effects on human health. To reduce the costs of the business, technological investments are needed that are aligned with the investment opportunity. A key role for this is the proactive processes -- development and upgrading of technologies, as well as studies for new opportunities.[^41^](#fn41){#fnref41.footnote-ref} Using the right optimisation tools will help improve process efficiency and reduce costs. Examples of this are: the implementation of digital accounting, including cloud-based calculation tools and specialised software, which facilitate management and help save costs. Another way to reduce costs is to use renewable energy sources. Of course, to achieve this, a large investment is required, which would be recouped after years. However, many financing options currently exist of SMEs precisely in this direction, which are largely related to the EU\'s goals of achieving carbon neutrality. Using energy-efficient appliances and lighting is also a sustainable way to reduce electricity bills. This is among the most affordable ways to achieve this goal. Relevant videos: - [[https://www.youtube.com/watch?v=BWSpiQQ2n5U]](https://www.youtube.com/watch?v=BWSpiQQ2n5U) - 3 Cost-Effective (& FREE) Ways to Become a Sustainable Business - [[https://www.youtube.com/watch?v=BfQeXnjIgP0]](https://www.youtube.com/watch?v=BfQeXnjIgP0) - The Economics of Sustainability \| Geoff Norby \| TEDx Erasmus University Rotterdam - [[https://www.youtube.com/watch?v=lB6IzWHnMqw]](https://www.youtube.com/watch?v=lB6IzWHnMqw) - Cost Reduction Potential of Sustainability - [[https://www.youtube.com/watch?v=TbYK622fRwo]](https://www.youtube.com/watch?v=TbYK622fRwo) - Are the Cost of Sustainability Worth It? ### Improved reputation Implementing sustainable practices can improve an SME\'s reputation and brand image, making it more attractive to customers, investors and other stakeholders. A good business reputation is essential to the success of an enterprise, as the purchase intention is influenced 60% by the perception of the company and 40% by the perceptions of the product.[^42^](#fn42){#fnref42.footnote-ref} In addition, investors demand environmental transparency from companies, as businesses with sustainable management are considered less risky and their reputations are more likely to be unscathed.[^43^](#fn43){#fnref43.footnote-ref} A large part of the population is becoming increasingly concerned about the impact on the environment and their consumption habits. Over half of online consumers in Europe believe that paying a higher price for an environmentally friendly product or service is worth it.[^44^](#fn44){#fnref44.footnote-ref} Most of them are interested in the methods of transport and the sustainability of the packaging. The younger generation, influenced by activists like Greta Thunberg, are the most environmentally minded. Trends in the next 10 years indicate that, after acquiring purchasing power, sustainable products and services will become even more sought after and valued in the market. Therefore, companies that have green and sustainable policies will be more competitive. A study conducted over a period of 15 years indicates that companies that have responsible social and environmental practices have lower financial volatility, higher sales growth and higher chances of survival.[^45^](#fn45){#fnref45.footnote-ref} Relevant videos: - [[https://www.youtube.com/watch?v=2rAUsnDELgI]](https://www.youtube.com/watch?v=2rAUsnDELgI) - Brand and reputation management (going sustainable) - [[https://www.youtube.com/watch?v=QKRckq5Oqvk]](https://www.youtube.com/watch?v=QKRckq5Oqvk) - Why should companies incorporate sustainability into their businesses? - [[https://www.youtube.com/watch?v=w36F7R\_RA-M]](https://www.youtube.com/watch?v=w36F7R_RA-M) - Sustainability in Business: Why Does it Matter? - [[https://www.youtube.com/watch?v=xfPxm-VMwto]](https://www.youtube.com/watch?v=xfPxm-VMwto) - Why sustainability equals opportunity in business \| Rethink Sustainability ### Access to new markets In recent decades, humanity has faced many global problems -- rapidly rising global temperatures and resulting extreme weather events, increasing inequality between people, deepening geopolitical tensions and the Covid-19 pandemic. These developments predetermine the need for change in consumer habits, production and service provision, as more and more people realise that management based on unsustainable practices and policies affects public health, the environment and the economy. Increasing awareness of threats to the environment and biodiversity increases the demand for sustainable products and limits market access for those that are not. Businesses of all sizes, including micro-SMEs, are gaining access to these emerging markets and attracting customers who are looking for sustainability in the production and delivery of products and services. For example, in 2020, the global green technology and sustainability market was valued at 9,32 billion € and is expected to reach 67,42 billion € by 2030, growing at a CAGR[^46^](#fn46){#fnref46.footnote-ref} of 21.9% during the period 2021-2030.[^47^](#fn47){#fnref47.footnote-ref} Sustainable management is critical to long-term growth and value creation. It can help access new markets in which to create value for customers who prioritise sustainable products and services. The sustainable management of an enterprise can help gain access to new markets in the following ways: - - - Building a positive business reputation: The application of sustainability in enterprise management is related to improving its image. In addition, this reputation can help businesses weather crises and downturns, as customers are more likely to support a reliable and environmentally and socially responsible company. Companies that have sustainable management are better prepared for the EU\'s carbon border tax system will have a competitive advantage in emerging markets.[^50^](#fn50){#fnref50.footnote-ref} - - Relevant videos: - [[https://www.youtube.com/watch?v=4IpTYB1w2Wc]](https://www.youtube.com/watch?v=4IpTYB1w2Wc) - The Market, The Challenge, The Future: Bloomberg on Sustainability - [[https://www.youtube.com/watch?v=ldMvGvzIG7g]](https://www.youtube.com/watch?v=ldMvGvzIG7g) - How do sustainability standards help businesses access markets? - [[https://www.youtube.com/watch?v=VvnK6lOsxg4]](https://www.youtube.com/watch?v=VvnK6lOsxg4) - What is a sustainable market? ### Regulatory compliance Many countries have regulations and policies to promote sustainable business practices. Each country\'s regulatory system is driven by single-environment permits (for air emissions, wastewater discharges, and waste disposal) that apply to each facility that has a relevant environmental impact. **Bulgaria** Bulgaria has implemented various regulations and policies to promote sustainable business practices. Some of these include: - - - - - - **Greece** Greece has also implemented various regulations and policies to promote sustainable business practices. Some of these include: - **Law no. 4548/2018 on Corporate Social Responsibility**: This law requires companies with more than 500 employees or a turnover of over €50 million to publish an annual report (NFRD) on their social, environmental, and ethical performance. - **Law no. 4936/2022. National Climate Law**: This Law aims at creating a coherent framework for improving the adaptive capacity and climate resilience of the country and for ensuring the gradual transition of the country to climate neutrality by the year 2050, in the most environmentally sustainable, socially fair and economically efficient way. - **Law no. 4964/2022:** This law is concerned with the protection of the natural and urban environment as a whole, forest ecosystems, funding of environmental projects, reduction of impacts of plastic products, simplification of environmental licensing and environmental controls, organisation and management of the Natural Environment and Climate Change Organisation and the Green Fund, the management of the energy crisis and the circular economy. - **[Law no. 4819/2021](https://faolex.fao.org/docs/pdf/gre211896.pdf) *on waste management****: This Law incorporates various EU Directives on waste management, packaging and packaging waste management, the protection of the natural environment, spatial planning, urban planning, energy and related regulations*. - **Law no. 5069/2023**. This law provides for conditions of building, construction, permitted land uses, zoning and urban planning regulations, utilisation of Green Fund resources, and other environmental and energy provisions - **Law no. 4951/2022**: This Law aims at creating a framework for the modernisation of the renewable energy sources licensing sector, for the production and storage of electricity, for the development of pilot marine floating photovoltaic stations; - **New Circular Economy Action Plan**[^56^](#fn56){#fnref56.footnote-ref}**:** This Action Plan, fully aligned with the objectives and commitments of European Union's circular economy action plan and taking into account European legislation on the matter, is a four-year road map (2021-2025) and includes 71 actions aiming at making the country\'s economy sustainable and at the same time competitive. These actions support the transition to a sustainable development model involving regional and local authorities, businesses and consumers to reduce the amount of waste, increase the reuse and recycling of products, create a market for secondary materials and waste as productive resources, increase the use of alternatives fuels, reduce the use of hazardous substances and promote circularity in production processes. - **National Energy and Climate Plan**[^57^](#fn57){#fnref57.footnote-ref}**:** This National Energy and Climate Plan (NECP) is the Greek government's strategic Plan for climate and energy issues, setting out a detailed roadmap regarding the achievement of specific energy and climate objectives by 2030, taking into account the European Commission's recommendations and the UN sustainable development goals. **Elsewhere** Governments around the world continue to expand regulations and corporate targets for sustainable development. In the EU, this includes a range of policies designed to improve environmental performance and establish a circular economy. Compliance with European laws, regulations, standards and other environmental requirements could give SMEs business opportunities to improve their reputation, resource efficiency. Implementing sustainable management practices beyond those that go beyond government can contribute to increasing competitive advantage.[^58^](#fn58){#fnref58.footnote-ref} In addition, compliance with national and European regulations ensures the avoidance of sanctions and damage to the company\'s reputation. Relevant videos: - [[https://www.youtube.com/watch?v=zgkBwhmLRHM]](https://www.youtube.com/watch?v=zgkBwhmLRHM) - The future of climate regulations in the EU \| Webinar - [[https://www.youtube.com/watch?v=huwW9Ugr-z8]](https://www.youtube.com/watch?v=huwW9Ugr-z8) - How the Sustainability Framework can support compliance with the EU Deforestation Regulation ### Increased employee engagement (role of Human Resources department) Employees are often more engaged and motivated when they work for a company that is committed to sustainability. A recent survey indicated that 60% of employees choose their workplace based on their beliefs and values.[^59^](#fn59){#fnref59.footnote-ref} Implementing sustainable practices can help SMEs attract and retain their best employees, increase productivity and engagement.[^60^](#fn60){#fnref60.footnote-ref} Small and medium-sized enterprises often have a more informal environment, with employees spanning multiple tasks, limited resources, and owners often overseeing several business-critical activities. All this can negatively affect the perception of sustainable changes in the management of the company by the employees. Ways to implement commitment to the company\'s sustainable goals include:[^61^](#fn61){#fnref61.footnote-ref} - Defining a long-term goal that provides information about how the success of the enterprise is linked to benefits for society and the environment. - Argue the economic benefits of implementing sustainable strategies (cost reduction or new market penetration). When employees are made aware of them, they can feel part of a more stable and meaningful company and be inclined to support your activity. - Acquiring knowledge and competence for sustainability. For small businesses, this can be training delivered in a variety of ways, including through a combination of internal and external resources. - Make all employees sufficiently committed to the sustainability strategy. This largely applies to employees in management positions. If they don\'t believe in sustainability, it will demotivate other employees. - Involve all employees in creating sustainable practices. This will create a sense of togetherness among them and motivate them. - Create an environment for healthy competition. Thus, you will stimulate creativity among employees about solving problems in sustainable ways. - Share your progress in implementing sustainable practices. The visible results of their implementation will encourage employees to feel more engaged with your sustainability program. Relevant video: - [[https://www.youtube.com/watch?v=hKUwdGMF-Ng]](https://www.youtube.com/watch?v=hKUwdGMF-Ng) - Sustana: eco-friendly recycled fibres reduce environmental impact - [[https://www.youtube.com/watch?v=lccqGsl1OAs]](https://www.youtube.com/watch?v=lccqGsl1OAs) - Employee Engagement with Sustainable Business ### Reduced environmental impact Small and medium-sized enterprises (SMEs) are a major driver of the green transition. Their combined impact on the environment is significant, as they represent 90% of the world\'s business.[^62^](#fn62){#fnref62.footnote-ref} Therefore, by reducing their environmental impact, SMEs can contribute to global efforts to address climate change and other environmental challenges. In order to reduce their impact on the environment, SMEs should make it a point to check the sustainability assessment, discussed in more detail in subsection 1.5. Sustainability assessment. ### Improved durability In the rapidly developing world and markets, sustainability has become a fundamental factor for business success.[^63^](#fn63){#fnref63.footnote-ref} In order to be prepared for unexpected events and to be able to recover from crises, businesses must react quickly and develop their resilience capacity.[^64^](#fn64){#fnref64.footnote-ref} Improved durability is one of the benefits of sustainable management. By implementing sustainable practices, SMEs can build greater resilience to future environmental and social challenges, such as natural disasters, resource scarcity and social unrest. Improved durability as a result of sustainable management can be beneficial for businesses and consumers. Some of the following sustainable strategies can help increase the resilience of SMEs: - Implementation of energy efficient practices: Today, SMEs are faced with high energy prices and uncertain supply, which increase their vulnerability. In order to improve it in this respect, these enterprises could reduce their energy consumption through different strategies: - replacing lighting with energy efficient ones - investing in energy efficient equipment - optimisation of heating and cooling systems - others - Use of sustainable materials: The enterprises can use sustainable materials to reduce their environmental impact and improve their durability. Sourcing with sustainable materials such as recycled paper, plastic, biodegradable packaging is associated with a number of benefits that help improve their durability - protecting the environment, attracting loyal customers and employees. The listed benefits are related to improved company reputation, which in turn leads to improved durability. - Applying the principles of the circular economy: Unlike the principles of the linear economy, those of the circular economy support the constant (re)circulation of products, materials and components, thus eliminating the destruction of the economic value of materials.[^67^](#fn67){#fnref67.footnote-ref} This is achieved based on the following principles:[^68^](#fn68){#fnref68.footnote-ref} - Sustainable sourcing -- represents environmentally friendly extraction and exploitation of resources - Ecodesign -- the product or service is designed in such a way that it does not negatively affect the environment during its entire life cycle. This includes the ability to repair, replace parts and replace in order to extend the life of the product. - Improving waste management -- minimising waste through recycling and recovery and as a valuable resource after processing. - Economy of functionality -- offering more services instead of products, thus limiting overconsumption - Industrial and territorial ecology - use of resources from nearby sources, products and waste are produced, transported and disposed of locally, if possible. - Fostering a sustainable culture: Businesses can encourage their employees to engage in sustainable practices such as judicious use of resources such as water, electricity, more economical use of energy, use of public transport or carpooling and other sustainable modes of transportation. In order for sustainable practices to be adopted among employees, they need to be aware of their benefits and how they help increase company resilience. - Stakeholder engagement: One of the ways to increase the sustainability of the company is to study and analyse its value chain, regarding the stakeholders. This can be achieved through "fine mapping of stakeholders", which is familiarisation with the opportunities to work with certain stakeholders (customers, employees, suppliers and others), thereby developing a balanced strategy to manage sustainable growth.[^69^](#fn69){#fnref69.footnote-ref} The challenges of sustainable management ---------------------------------------- Sustainable management involves balancing economic, social, and environmental considerations in the decision-making process. It is a complex and challenging task that requires careful planning, effective implementation, and ongoing monitoring and evaluation. ### Limited resources SMEs often have limited financial and human resources, which can make it difficult to invest in sustainable practices. Implementing sustainable practices can require significant upfront costs, such as investing in energy-efficient equipment or redesigning products or packaging. Additionally, SMEs may not have dedicated staff to manage sustainability initiatives, which can make it difficult to prioritise sustainability alongside other business activities. Financial resources are essential for the adoption of sustainable practices by SMEs. Due to the scale of the enterprises, financial problems are one of the biggest obstacles including:[^70^](#fn70){#fnref70.footnote-ref} - lack of funding, - high costs of implementing environmental practices, - the length of period a for investment returns. In addition, SMEs face other challenges related to increasing their resilience: - difficulties in acquiring financial capital, - high initial capital costs to implement sustainable practices, - lack of suitable investors, - the high costs of certification/verification. SMEs often share their intention to implement environmental initiatives as long as the process is not too expensive and daunting.[^71^](#fn71){#fnref71.footnote-ref} They are less able to access green technologies than large companies. 27% of SMEs in the EU perceive the lack of resources as an important obstacle in their greening.[^72^](#fn72){#fnref72.footnote-ref} However, SME owners can start with small steps towards sustainably transforming their enterprise that do not require large sums of money. For example, projects related to energy-efficient lighting do not require a large investment and have a quick return. Other practices that do not require financing (recycling, saving water and electricity, etc.) can also be adopted by the enterprise. In this way, it will have a better chance of further financing environmental projects in the future. In order to expand their activities, SMEs need capital and apply for loans and grants. Lenders\' decision is largely dependent on the fulfilment of certain criteria, which are increasingly related to companies\' commitment to sustainable practices and policies. Measuring and reporting on their sustainability can therefore contribute to access to finance that may otherwise be unavailable. An advantage of SMEs in the member countries is that the EU has a clearly stated goal of being the first climate-neutral bloc in the world by 2050. For this purpose, the Green Action Plan[^73^](#fn73){#fnref73.footnote-ref} (GAP) was adopted, which enables SMEs to support the transition to a green economy. The plan enables improving resource efficiency, harnessing the opportunities of greener value chains, and facilitating market access and supporting green entrepreneurship.[^74^](#fn74){#fnref74.footnote-ref} SMEs are often not sufficiently aware of the availability of financially attractive opportunities related to sustainability such as tax breaks, subsidies from European and state authorities.[^75^](#fn75){#fnref75.footnote-ref} SMEs experience difficulties in accessing green markets due to the following main reasons: - They have limited financial and human resources, which is also related to limited opportunities to invest in sustainable practices.[^76^](#fn76){#fnref76.footnote-ref} - They lack the knowledge and experience needed to develop sustainable products and services.[^77^](#fn77){#fnref77.footnote-ref} - They have limited access to funding for green goals due to: - lack of awareness, - lack of experience, which weighs on financing unsustainable practices and lending - green finance providers view SMEs as riskier due to smaller business size and lack of benefits - The procedures for applying for green finance can be complicated and time-consuming, which is a challenge for SMEs - Limited availability of green finance in some areas. - They may have limited visibility into their supply chains, which could negatively impact their green image, competitiveness with larger companies and consumer expectations. ### Lack of expertise According to a report by the European Commission, 23% of SMEs encounter difficulties in implementing activities for the efficient use of resources due to a lack of specific environmental knowledge.[^78^](#fn78){#fnref78.footnote-ref} SMEs often do not have their own sustainability experience and may not know how to effectively implement sustainable practices. This can be particularly challenging for businesses in industries that have a high environmental impact, such as manufacturing or transportation. SMEs may need to invest in external expertise to help them develop and implement sustainability strategies. Some studies indicate that the lack of managerial awareness of sustainability is a major barrier to the implementation of sustainable management in SMEs.[^79^](#fn79){#fnref79.footnote-ref} In addition, barriers to their awareness are: - lack of inventory data[^80^](#fn80){#fnref80.footnote-ref}, - lack of green skills among employees[^81^](#fn81){#fnref81.footnote-ref}, - customers\' lack of knowledge of tool-based products/processes[^82^](#fn82){#fnref82.footnote-ref}, - education systems do not adequately respond to business[^83^](#fn83){#fnref83.footnote-ref} requirements and dynamics, - lack of experienced instrument verifiers[^84^](#fn84){#fnref84.footnote-ref}, - lack of information about companies that are suitable[^85^](#fn85){#fnref85.footnote-ref} for cooperation. A study of 220 enterprises indicated that approximately 30% of them are not informed about the environmental protection actions they undertake, and about 60% wish to help protect it and need more information to achieve this.[^86^](#fn86){#fnref86.footnote-ref} ### Limited market access While many consumers and businesses are increasingly interested in sustainable products and services, SMEs can face challenges accessing these markets. SMEs may not have the same marketing and distribution channels as larger competitors, which can make it difficult to reach customers who prioritise sustainability. A report by the European Commission indicated that large SMEs are more likely to offer green products or services compared to micro enterprises - 38% versus 31%.[^87^](#fn87){#fnref87.footnote-ref} These values are higher for large companies -- 46% of them tend to sell green products and services. This is indicative of market access for these businesses. Examples of accessible online resources for reaching green markets in the EU are as follows: - [[The European Commission\'s Green Public Procurement (GPP)]](https://ec.europa.eu/environment/gpp/index_en.htm) -- it has information on the EU\'s GPP criteria, as well as information on exactly how to apply them. Resources and case studies for businesses interested in selling green products are also uploaded to the website - [[EU\'s Market Access Database (MADB)]](https://trade.ec.europa.eu/access-to-markets/en/content/welcome-access2markets-market-access-database-users) -- an online database providing information on EU import requirements, tariffs, trade agreements. This is a useful resource for businesses looking to export green products to the EU. - [[European Environmental Bureau (EEB)]](https://eeb.org/) -- is a network of environmental organisations in the EU that provides information and resources related to the environment and sustainable business practices. - [[EU\'s Circular Economy Stakeholder Platform]](https://circulareconomy.europa.eu/platform/en) -- unites interested parties on the territory of the EU. The platform shares information on good practices regarding the circular economy. It is a useful resource for enterprises seeking to adopt circular business models. - [[EU\'s LIFE Programme]](https://cinea.ec.europa.eu/programmes/life_en) -- a network of environmental organisations to share resources related to the environment and sustainable business practices. - [[Enterprise Europe Network]](https://een.ec.europa.eu/) -- the network assists small and medium-sized businesses (SMEs) and entrepreneurs in Europe with market information access, legal challenges, and new business partners. - [[Your Europe Business Portal]](https://europa.eu/youreurope/business/index_en.htm) -- the webpage serves as a helpful manual for conducting business in Europe. It offers information and interactive services to business owners to aid in their international business expansion. ### Limited impact on suppliers Global supply chains are a collection of complex multi-functional production and transportation networks. Their traceability is impossible for most businesses, as businesses often do not work directly with all of their suppliers (some of the main suppliers may subcontract parts of large orders).[^88^](#fn88){#fnref88.footnote-ref} In addition, actors in the chain can only trace their segment, which makes the traceability of the supply chain complex. Lack of sufficient knowledge about the sustainability of supply chains can have a negative impact on the image of a sustainable business due to the fragmentation of product information. The concept of transparency in supply chains is attracting more and more attention nowadays. This is due to increasing pressure from consumers, governments, non-governmental organisations and other stakeholders, and on which the reputation of businesses largely depends.[^89^](#fn89){#fnref89.footnote-ref} Governments are demanding more and more transparency in supply chains, introducing laws that aim for businesses to track whether their supply chains are linked to social, environmental and corruption risks.[^90^](#fn90){#fnref90.footnote-ref} Supply chain transparency is an opportunity to ensure that all processes and suppliers upstream (cultivation, extraction and procurement of resources and their processing) and downstream (activities to get the final product to the customer) along the supply chains are fair and do not harm the environment or human rights. The two main elements of supply chain transparency are:[^91^](#fn91){#fnref91.footnote-ref} - Visibility -- recognising and gathering information from each supply chain link. - Disclosure -- delivering that information to the appropriate level of detail, both internally and externally. Achieving transparency in supply chains is complicated because they are generally not designed to be transparent. This is because companies and suppliers are aware that disclosing too much information on their part could potentially undermine their competitive advantage.[^92^](#fn92){#fnref92.footnote-ref} A problem for companies offering sustainable products and/or services is the impossibility of guaranteeing sustainability along the supply chain. This is a relatively difficult task as supply chains can be extremely complex because they often span several geographies. The more complex a supply chain, the greater the potential for lack of transparency in it, as globalisation has helped make it more difficult to trace the origin of goods, materials and raw materials. [^93^](#fn93){#fnref93.footnote-ref} Therefore, it is almost impossible for companies to guarantee that the product they offer is not made of components that harm the environment or that human rights are not violated along the supply chain. Technology comes here to the help: AI and blockchain are tools for tracking and assessing supply chain sustainability. They are described in more detail in subsection 4.2.1.2. AI/ML/Blockchain. SMEs may not have the same bargaining power as larger enterprises and may struggle to influence the sustainability practices of their suppliers. For example, a small clothing company may want to use sustainable materials, but if their fabric supplier is not sustainable, it can be difficult to implement this change. ### Limited regulatory support Although there are regulations and policies that promote sustainable practices, SMEs may not have the same access to these policies as larger enterprises. In addition, regulatory requirements can be complex and burdensome for small businesses to comply with, which can be a barrier to implementing sustainable practices. A study of the impact of regulations defines regulation as \"the imposition of rules by the government, supported by the use of sanctions, which are designed specifically to change the economic behaviour of individuals and firms in the private sector.\"[^94^](#fn94){#fnref94.footnote-ref} **Bulgaria** Bulgarian SMEs may lack the resources and capacity to comply with the regulations and standards required to access certain incentives and benefits. For example, they may not have the expertise or funding to implement energy-efficient measures or to obtain the necessary certifications. Another reason is that the administrative burden and costs associated with accessing incentives and benefits may be disproportionately high for SMEs compared to larger enterprises. The application processes and requirements for accessing these policies and incentives may be complex and time-consuming, making it difficult for SMEs to navigate. To address these challenges, the Bulgarian government has implemented various measures to support SMEs in adopting sustainable business practices. These include: - Providing information and training: The Bulgarian government offers information and training programs to help SMEs understand and comply with environmental regulations and standards. - [[Concept for Digital Transformation of Bulgarian Industry (Industry 4.0)]](https://www.mi.government.bg/files/useruploads/files/ip/Industry4.0.pdf) -- Aims to create prerequisites for modernisation and automation of the Bulgarian economy in the medium and long term.[^95^](#fn95){#fnref95.footnote-ref} - [[National strategy for small and medium enterprises 2021-2027]](https://www.strategy.bg/FileHandler.ashx?fileId=25595) -- Concerns a strategic framework providing targeted support for SMEs. Aims to support enterprises during their life cycle, increase their competitiveness, promote development and entrepreneurship.[^96^](#fn96){#fnref96.footnote-ref} - [[ISPA program]](https://www.mrrb.bg/bg/programa-ispa/) - provides financial support for investment in the field of environment and transport.[^97^](#fn97){#fnref97.footnote-ref} - Financial support: The government provides financial support to SMEs to implement energy-efficient measures and to obtain necessary certifications. - [[National Recovery and Resilience Plan]](https://www.nextgeneration.bg/upload/67/BG+FinalRRP+2022-04-06-08-30+%28-TCA-%29.pdf) -- Assists SMEs to apply for subsidies related to investing in renewable energy installations and related infrastructure.[^98^](#fn98){#fnref98.footnote-ref} - [[PROCEDURE BG-RRP-3.006 \"Construction of new ways for own consumption in combination with local energy storage facilities\"]](https://eumis2020.government.bg/bg/s/Procedure/Info/10b9787c-b382-40f2-94b9-1bd8b31f8799) -- Providing funds for the construction of renewable energy sources, combining with local structures for energy storage. [^99^](#fn99){#fnref99.footnote-ref} - Simplifying administrative procedures: The government has simplified administrative procedures for SMEs to access policies and incentives, reducing the time and costs associated with compliance.[^100^](#fn100){#fnref100.footnote-ref} - Establishing support networks: The [[Bulgarian Business Leaders Forum (BBLF)]](https://www.bblf.bg/) provides support networks for SMEs to share best practices and knowledge on sustainable business practices.[^101^](#fn101){#fnref101.footnote-ref} ЕС: - [[Buy environmentally friendly! Handbook on environmental nature of public procurement]](https://www2.aop.bg/wp-content/uploads/2019/05/buying_green_handbook_bg.pdf) **Greece** In Greece, similar to Bulgaria, small and medium-sized enterprises (SMEs) may face challenges in accessing policies and incentives for sustainable business practices. Some of these challenges include: - Limited access to financing: SMEs may face difficulties in accessing financing for sustainable business practices, as they may lack the necessary collateral or have limited financial resources. - Limited awareness and capacity: SMEs may not have the same level of awareness and capacity as larger enterprises to implement sustainable practices, such as energy efficiency measures or waste reduction strategies. - Administrative burdens: The administrative burdens associated with complying with regulations and accessing incentives and benefits may be disproportionately high for SMEs compared to larger enterprises. To support SMEs in adopting sustainable business practices, the Greek government has implemented various measures, including: - Financial support: The government provides financial support to SMEs through various funding programs, such as the Entrepreneurship Fund, to implement sustainable practices and technologies. - Information and training: The government offers information and training programs to help SMEs understand and comply with environmental regulations and standards. - Simplified administrative procedures: The government has simplified administrative procedures for SMEs to access policies and incentives, reducing the time and costs associated with compliance. - Establishing support networks: The Hellenic Network for Corporate Social Responsibility (CSR Hellas) provides support networks for SMEs to share best practices and knowledge on sustainable business practices. Sustainable management in all its dimensions, focusing on real-life problems ---------------------------------------------------------------------------- One way sustainable management can focus on real-life problems is by implementing environmentally sustainable practices in business operations. For example, a company might reduce its greenhouse gas emissions by investing in renewable energy sources, using energy-efficient technologies, and promoting the use of public transportation among its employees. This helps to reduce the company\'s carbon footprint and contribute to the fight against climate change. Sustainable management can also focus on social sustainability by addressing issues such as labour rights, fair wages, and social justice. This can be achieved by ensuring that employees are treated fairly and given opportunities for growth and development within the company. Additionally, companies can work to promote diversity, equity, and inclusion in their workplaces. Economic sustainability is another important aspect of sustainable management. This involves ensuring that business operations are financially sustainable and that resources are used efficiently. Companies can achieve this by implementing cost-saving measures such as reducing waste, optimising supply chains, and investing in research and development to create innovative, sustainable products. ### 3 main pillars of development Sustainable management is a way of managing an organisation that covers economic, environmental and social goals[^102^](#fn102){#fnref102.footnote-ref} and is linked to three main pillars of development (social, economic and environmental). []{#_Toc181190664.anchor}Figure 2: Three main pillars of development (social, economic and environmental) - **Ecological pillar** - reducing the carbon footprint - waste reduction - optimisation of production processes - reducing the amount of energy used - creating a sustainable supply chain - improving biodiversity - reasonable use of natural resources - etc. - **Social pillar** - protection of human rights - promoting equality between different demographic groups defined by gender, race, ethnicity, etc. - ensuring access to healthcare, education and other basic services - investing in social protection programs aimed at building sustainable communities - **Economic pillar** - efficient use of resources - improving profitability - development of policies promoting investment in renewable energy sources - promoting fair trade practices - achieving economic growth - responsible use of natural capital Sustainability assessment ------------------------- Assessing the stability of an enterprise is related to its commitment to contributing to a sustainable global economy. It helps to identify the current indicators of the business. It is an important tool to support the transition to sustainability. It is a process of assessing sustainability initiatives,[^112^](#fn112){#fnref112.footnote-ref} it aims to analyse specific problems and decision-making situations that could improve sustainability.[^113^](#fn113){#fnref113.footnote-ref} It is also linked to other impact assessment tools such as the Environmental Impact Assessment and Strategic Environmental Assessment[^114^](#fn114){#fnref114.footnote-ref} or the EU Sustainability Impact Assessment.[^115^](#fn115){#fnref115.footnote-ref} Impact assessment evaluates how effective sustainable organisations, projects, products that are produced or processes are and is an analysis of the environmental, social and economic impacts of the object of assessment, as well as finding opportunities for its improvement.[^116^](#fn116){#fnref116.footnote-ref} In order to assess the stability of the enterprise and improve the sustainability indicators, the following steps should be followed:[^117^](#fn117){#fnref117.footnote-ref} 1. Defining the vision, mission and values of the enterprise 2. Creating a team to be committed to improving sustainability 3. Prepare an assessment of the current performance of the enterprise in the field of sustainability 4. Create a green culture among employees 5. Choose your goals and predict the benefits of implementing them 6. Implement the management plan including new practices and policies 7. Track your progress 8. Analyse the results 9. Share your achievements with your employees and customers 10. Get certified or consider your next upgrades An assessment of the sustainability of an enterprise is made in order to determine which aspects of its activity can be improved. This can be achieved by using "footprint" methods of various indicators: - Organisational Ecological Footprint (OEF) -- a framework for determining the environmental performance of an organisation from the point of view of the life cycle of the goods and services offered.[^118^](#fn118){#fnref118.footnote-ref}\ [Formula:] Ecological Footprint = (Area of Land and Water used for Production) / (Biocapacity per unit of Land and Water)\ The area of land and water used for production includes the land and water used for growing crops, grazing livestock, building infrastructure, and extracting resources, among other activities. Biocapacity refers to the capacity of ecosystems to produce resources and absorb waste, and is measured in hectares per year.\ Through its use, it is aimed at determining environmental critical points, benchmarking, business-to-business communication, and also helping to develop a common methodology for measuring an organisation\'s environmental performance.[^119^](#fn119){#fnref119.footnote-ref} Under the life cycle approach, OEF is the modelling and quantification of the environmental impacts of material and/or energy flows and the associated emissions and waste associated with supply chain activities.[^120^](#fn120){#fnref120.footnote-ref} The types of ecological footprint that can be measured are:[^121^](#fn121){#fnref121.footnote-ref} - Water footprint -- measures the amount of fresh water that is used in the process of producing a good or providing a service - The climate change footprint -- covers the amount of greenhouse gases that are released into the atmosphere as a result of the company\'s activities - Atmospheric footprint -- refers to the harmful impact (emission of greenhouse gases and atmospheric pollutants, deforestation) that a manufactured product has on the atmosphere - Resource footprint -- reflects the number of natural resources used to create a product or service. - The waste footprint -- is related to the environmental pollution that results from a given product or service. - Biodiversity Footprint -- covers the negative impacts of business on ecosystems. - Social Footprint (SF) -- is based on the measurement, management and reporting of an organisation\'s sustainability in relation to social issues (labour practices, community development, human rights, inclusion, etc.). Through it, companies can ensure that they fulfil their social responsibilities and improve the areas in which they need change. Unlike the Ecological Footprint, which focuses on the environmental impact of human activities, the Social Footprint measures the positive and negative social outcomes of an organisation\'s operations, products, and services. There is no standardised formula for calculating a Social Footprint, as it can be tailored to the specific needs and goals of an organisation. Some of the indicators that are considered when measuring the social footprint cover different groups of stakeholders:[^122^](#fn122){#fnref122.footnote-ref} - Workers/employees - - - - - - - - - Consumers - - - - - - Local Community - - - - - - - - - - Value chain actors (not including consumers) - - Value chain actors (not including consumers) - - - - Economic footprint - its measurement allows to quantify the benefits and impacts of an enterprise\'s activities and operations. It measures the direct, indirect, and induced economic effects of an organisation\'s operations, including its expenditures on goods and services, its employment of workers, and its contributions to local taxes and government revenues. This is of essential role for the added value of the business. Measuring the economic footprint can be used to:[^123^](#fn123){#fnref123.footnote-ref} - perform accounting for corporate social responsibility, - communicate the higher value to stakeholders such as investors, government, local councils, - differentiate from the competition. ### Scope and limits The assessment should clearly define the scope and boundaries of the assessment, including the environmental and social impacts of the business and the systems and processes being assessed. Environmental Impact Assessments are often required and must adhere to tight regulatory requirements established by the governmental body in charge of a specific project. An Environmental Impact Assessment often includes:[^124^](#fn124){#fnref124.footnote-ref} - presentation of environmental goals and policy - description of the sustainability of the current policy - Project description - an evaluation of the project\'s probable effects - a recommendation summary - Environmental Management Plan (EMP) ### Identify key sustainability issues The assessment should identify key sustainability issues related to the business and its operations, such as carbon emissions, water use, waste generation and social impact. These issues should be prioritised based on their importance and potential impact. The main obstacles to the implementation of sustainability in SME policies are the following:[^125^](#fn125){#fnref125.footnote-ref} - Small and medium-sized enterprises face a number of problems (human, political, cultural changes) that prevent them from expanding their environmental activities.[^126^](#fn126){#fnref126.footnote-ref} - According to some scientists, the main barriers to the sustainability of SMEs are the lack of managerial awareness related to sustainability issues and available programs.[^127^](#fn127){#fnref127.footnote-ref} - Lack of access to data, low eco-literacy and lack of understanding about environmental management make it difficult for some businesses to interpret and understand the rules and they can affect their business.[^128^](#fn128){#fnref128.footnote-ref} - Difficulties in obtaining environmental and business information. Some studies indicate that about 30% of SMEs have no information about the requirements related to environmental reforms.[^129^](#fn129){#fnref129.footnote-ref} - Missing inventory data[^130^](#fn130){#fnref130.footnote-ref} - Lack of necessary skills on the part of employees[^131^](#fn131){#fnref131.footnote-ref} - Lack of information on cooperation with suitable companies[^132^](#fn132){#fnref132.footnote-ref} Identifying key issues related to business sustainability requires a comprehensive understanding of social, economic and environmental impacts related to its operations and company policies. To identify their sustainability gaps, SMEs should follow these steps: 1. Defining the scope and objectives of the sustainability assessment. This stage involves evaluating the business units, products or services 2. Collection of data about the products, services and operations for their creation - generation of waste, use of natural resources, informing about supply chains, social impact of the company\'s activities. 3. Data analysis. By analysing data to identify potential sustainability issues. The analysis may show that the following problems have been undertaken which are related to sustainability: - energy inefficiency, - insufficient utilisation of raw materials and materials, causing the generation of a large volume of waste, - inefficient use of water resources, - release of emissions of greenhouse gases and atmospheric pollutants, - supply chain risk detection 4. Identifying stakeholders (customers, suppliers, employees, investors, local community) and getting to know their concerns and expectations about sustainability. 5. Prioritisation of sustainability issues, relative to their significance and impact on the enterprise, stakeholders and the ability to address them. 6. Develop a sustainability strategy that addresses sustainability issues. It should include specific goals and action plans to improve the prioritised problems and the sustainability of the enterprise. 7. Implementation and monitoring aimed at evaluating the effectiveness of the created sustainability improvement strategy. ### Data collection and analysis The assessment should include the collection and analysis of data on the sustainability of the business, including both quantitative and qualitative data. This data can be used to identify areas where the business is performing well and areas where improvement is needed. **Examples** Quantitative data: - Carbon emissions: Quantitative data can be used to measure a business\'s carbon emissions, which can help to identify opportunities for reducing its environmental impact. - Water usage: Quantitative data can also be used to measure a business\'s water usage, which can help to identify opportunities for improving water efficiency. - Waste production: Quantitative data can be used to measure the amount of waste produced by a business, which can help to identify opportunities for reducing waste and improving recycling and reuse. - Employee turnover rates: Quantitative data can be used to measure employee turnover rates, which can provide insights into the company\'s culture and its ability to retain employees. Qualitative data: - Stakeholder interviews: Qualitative data can be collected through interviews with stakeholders, such as employees, customers, and suppliers. These interviews can provide insights into the company\'s values and culture, as well as its impact on the community. - Social media sentiment analysis: Qualitative data can also be collected through social media sentiment analysis, which involves analysing social media posts and comments to identify positive and negative sentiments about the company. - Case studies: Qualitative data can be gathered through case studies of other companies that have implemented sustainable practices. These case studies can provide insights into the challenges and opportunities associated with sustainable business practices. ### Stakeholder engagement The assessment should include engagement with key stakeholders, including employees, customers, suppliers and the local community, to gain a better understanding of their perspectives on business sustainability and to identify areas where the business can improve. ### Setting goals and objectives Based on the assessment findings, the business should set specific and measurable sustainability goals and objectives to guide its sustainability efforts. These goals should be aligned with the overall business strategy and should be regularly reviewed and updated. In order to set specific goals, business owners must answer three basic questions: - What is the scope of my sustainability goal? - In which area does the enterprise need improvements related to sustainability? - Over what period of time do I want to see improvements? A good strategy needs a clear definition of sustainability goals. They may be related to improving environmental performance, reducing emissions, optimising the use of resources or waste, and training employees. They can be divided into two main types:[^133^](#fn133){#fnref133.footnote-ref} - quantitative - Example: reducing energy consumption by 15% or reducing waste by 20%. - quality - Example: acquisition of green skills among employees or more added value for customers. After defining the sustainability goals, there is the determination of a period of time in which they must be achieved. In order to measure progress against their implementation, clear parameters for the sustainability goals must be defined using certain indicators. For example, a company decides to reduce the amount of paper used by its employees. To achieve this goal, the amount of paper used by each employee should be measured and what it would be after implementing the new paper-saving practice in the company. Such performance indicators can help measure progress or deceleration. ### Action planning The assessment should lead to a clear action plan that outlines the steps the business needs to take to achieve its sustainability goals and objectives. The action plan should include specific actions, timelines, responsibilities and resources needed to implement the plan. Measurable sustainability goals should be developed by professionals who have a good understanding of the production or service delivery process, who have knowledge of current indicators and regulatory frameworks and can anticipate how they will change in the future.[^134^](#fn134){#fnref134.footnote-ref} When creating a plan to achieve a particular sustainability goal, the available technology and that which may be available going forward, the regulatory environment and commercial progress must also be taken into account. The study of potential solutions to achieve the set goal is of crucial importance for the preparation of a strategy that is tailored to the capabilities and needs of the enterprise. ### Monitoring and reporting Businesses should establish a system for monitoring and reporting on their sustainability performance, including regular tracking of progress against their targets. By consistently measuring performance indicators, the enterprise can ensure that the sustainable activities undertaken in its policy can be controlled. Therefore, indicators should be regularly recorded in a database to be comparable over time. Businesses should also communicate their sustainability performance to stakeholders through regular sustainability reports or other communication channels. Measurable sustainability goals are productive when they use rigorous methodologies to collect the necessary data. - A sustainability assessment is a process for evaluating the environmental, social, and economic impacts of an organisation\'s activities or products. The assessment can help identify areas where the organisation can improve its sustainability performance and develop strategies to mitigate negative impacts and enhance positive ones. Here are some steps for performing a sustainability assessment: - Define the scope and objectives: Identify the scope of the assessment, including the activities or products to be assessed, the timeframe, and the relevant stakeholders. Establish clear objectives and goals for the assessment. - Gather data: Collect data on the organisation\'s environmental, social, and economic performance. This may include data on greenhouse gas emissions, energy and water consumption, waste generation and disposal, labour practices, community engagement, and product lifecycle impacts. - Analyse the data: Analyse the data to identify trends and patterns in the organisation\'s sustainability performance. Consider the potential impacts on stakeholders and the environment. - Evaluate performance: Evaluate the organisation\'s performance against relevant sustainability standards, such as [[ISO 14001]](https://www.iso.org/iso-14001-environmental-management.html) (Environmental Management System), [[ISO 26000]](https://www.iso.org/iso-26000-social-responsibility.html) (Social Responsibility), or the [[Global Reporting Initiative]](https://www.globalreporting.org/) (GRI). - Identify improvement opportunities: Identify areas where the organisation can improve its sustainability performance. This may include developing new policies, implementing new practices or technologies, or engaging with stakeholders to improve social and environmental outcomes. - Develop a sustainability action plan: Develop a sustainability action plan that outlines specific actions to improve sustainability performance, with clear targets, timelines, and responsibilities. - Monitor and report progress: Monitor and report progress on the sustainability action plan, and communicate sustainability performance to stakeholders through sustainability reporting and other communication channels. What is an environmental management system and why should you implement it in your company? (The Plan-Do-Check-Act model and ISO 14001) ======================================================================================================================================= An environmental management system (EMS) is a systematic approach to managing an organisation\'s environmental impact. Implementing an EMS can help a company achieve its environmental footprint, comply with regulatory requirements and improve its reputation as a responsible and sustainable company. ISO 14001 is a standard developed by the "International Organisation for Standardisation" (ISO) for the creation and implementation of environmental systems (EMS).[^135^](#fn135){#fnref135.footnote-ref} The standard provides businesses with a standardised framework to use in developing sustainable environmental management strategies. The Low Union Eco-Management and Audit Scheme (EMAS) was also created on this standard, which also consists of additional elements (a public environmental statement and a verified environmental performance indicator).[^136^](#fn136){#fnref136.footnote-ref} EC\'s EMAS scheme is now compatible with ISO 14001[^137^](#fn137){#fnref137.footnote-ref}. A good EMS system includes: [^138^](#fn138){#fnref138.footnote-ref} - Improved environmental policy -- engaging the enterprise in activities that help to mitigate the harmful impact on it. - Assessment of how the company affects the environment through corporate activities, procedures and services and/or products provided - Detailed information on environmental regulations and legislation in the country in which it operates, as well as guidance on compliance - Documentation and control of activities that have a negative impact on the environment - Plan for sustainable environmental management - waste and resource management - Program for sustainable training of employees and distribution of environmental responsibilities among them - Setting and tracking the company\'s environmental goals - Systems for internal and external communications involved in environmental management issues. - Systems for detecting and correcting problems and preventive measures against their recurrence - Emergency procedures in case of environmental incident or accidents - Periodic audit to verify the effectiveness of the EMS, adapt and improve it if necessary []{#_Toc181190665.anchor}Figure 3: Plan-Do-Check-Act (PDCA) model The Plan-Do-Check-Act (PDCA) model as illustrated above, and ISO 14001 are commonly used frameworks for implementing an EMS. By creating the PDCA model and implementing ISO 14001, a company can ensure that their EMS is structured, effective and meets internationally recognised environmental management standards. The PDCA model is a change cycle made up of four steps: 1. PLAN - What is the main problem that needs to be solved? - What are the resources needed to resolve it? - What resources does the enterprise have? - How can available resources be used to fix the problem? - What are your success criteria? - What are your goals? - Goal setting: The process begins with top-level management setting strategic goals and objectives for the organisation. - Plan deployment: These goals and objectives are then communicated to lower-level managers and employees, who are responsible for developing action plans to achieve them. - Catchball: The action plans are then passed back up the chain of command, with feedback and ideas exchanged between different levels of the organisation. This iterative process helps to ensure that the plans are aligned with the strategic goals of the organisation and that they take into account the unique perspectives and knowledge of each team. - Implementation: Once the action plans have been developed and finalised through Catchball, they are implemented and progress is tracked and monitored against the strategic goals of the organisation. 2. DО 3. CHECK 4. ACT - the expected results have been achieved. In this case, this can be used as a reference for the improvement of other goals or units in the enterprise. - the result is not satisfactory enough. In this case, new solutions and strategies must be found. There are a range of self-assessment questionnaires available on the web that you could use to help determine your company\'s sustainability: - [[ISO 14001 Self-Assessment Checklist]](https://public-library.safetyculture.io/products/iso-14001-self-assessment-questionnaire) - [[Green Small Business Checklist]](https://greenbusinessbureau.com/wp-content/uploads/dlm_uploads/2022/05/GREEN-BUSINESS-CERTIFICATION-CHECKLIST-1.pdf) - [[GEMI ISO 14001:2015 Self-Assessment Checklist]](https://gemi.org/solutions/solutions-interactive/iso-14001-2015-checklist/) - [[BASIC SUSTAINABILITY ASSESSMENT TOOL (BSAT)]](https://sustainabilityadvantage.com/documents/BSAT%20v11.xlsx) - [[Self-Audit, Resource-Mapping and Ideation Tools ]](http://www.sustain-t.eu/uploads/IO3%20Tools_compiled%20version_UK.pdf) - [[Sustainability Assessment Questionnaire on CSR/ Sustainability for Automotive Sector Suppliers]](https://www.bmwgroup.com/content/dam/grpw/websites/bmwgroup_com/responsibility/downloads/en/2022/Sustainability-Assessment-Questionnaire_SAQ_5.0_EN.pdf) - [[Sustainability Self-Assessment for all food retail operators]](https://www.research.net/r/RM5RGSP) -

Sustainable Innovative Business Management Training Handbook for Micro-SMEs PDF

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