Innovation also involves managing a business. According to KPMG, a large majority of Canadian SMEs say they are committed to integrating so-called environmental, social and governance (ESG) standards and practices. The problem is, they often don’t know how to achieve this.
Andrew Ross, director of ESG practices at KPMG, believes that the majority of Quebec SMEs have a strong commitment to the integration of ESG criteria. The only downside is that few take action: “Many do not yet have a real understanding of the ESG issues that impact their business or do not know where to start to take action. »
For Andrew Ross, this is where the problem lies: “SMEs want to act, but they do not always have the information to do so. »
However, he explains that SMEs which do not have concrete data will still act, by first focusing on social criteria such as diversity and inclusion in hiring.
For Jordan Mertz, who employs 15 people at the Longueuil pastry shop Ô Gateries, inclusion in hiring involves pay equity and flattening the hierarchy: “We have a transparent salary scale which allows new employees to know exactly where they are located and how they can evolve. We also invite them to be autonomous and participate in decisions and solutions even if they work part time. »
In terms of environmental initiatives within the reach of SMEs, Andrew Ross cites the reduction of plastics and packaging materials.
At Ô Gâteries, we think about the life cycle of the packaging by asking where it comes from, what it is made of and how it will end: “Even if waxed paper bags allow a little longer conservation, we favor [ordinary] paper because it is more easily recyclable. »
In addition to government pressure, the criteria that push SMEs to want to integrate ESG standards are often linked to the difficulty of accessing financing, the fear of loss of income or customer expectations.
Jordan Mertz confirms that his customers ask him about managing food loss, but he is able to reassure them: “We create baskets with unsold food and offer them on anti-waste applications. We also donate some to various organizations. It’s our way of getting involved in the community. »
Whatever the motivation, Andrew Ross advises SMEs to establish where they stand in relation to trends in their sector and focus on the factors that have a real impact on the business: “Are we in tune with its industry and stakeholders? Once these answers have been identified, you can target priority ESG issues for your business strategy. We do not want to engage in practices that have no impact on the value of the company. It has to make sense from a business perspective. »
For the owner of the pastry shop, the recipe for successfully integrating ESG standards within small SMEs is to manage them like large companies: “For it to work, the entire operation of the company must have been thought through. The processes must be clear and applied in order to then be able to address complex issues such as the environment and carry out projects that are important to us. »