Simon Cureton, CEO of Funding Options observes that in recent years there’s been something of a “green boom”, with huge rises in the share prices of eco-friendly businesses like Tesla. It’s part of a growing international trend for consumers to look hard at the climate impact of the products they buy, and at the social and environmental policies of the companies they buy them from.
At the same time, there’s been a corresponding trend towards green finance, with lenders increasingly channelling their investments towards businesses with good ESG records.
For one thing, this means that SMES, like all businesses, will need to smarten up their green strategies if they’re looking to secure funding, but they should also take note of the opportunities. For instance, some lenders have been offering preferential rates to businesses that have bona fide green credentials. That’s one of the factors behind recent research findings which show that companies with good records in ESG generally enjoy a lower cost of capital.
Simon accepts that it can be very hard to tell exactly which companies are genuinely green, and which are just paying lip service in order to burnish their green credentials. Investigating and validating each potential borrower’s or lender’s green policies and performance is something of a minefield, he says, and to help them find their way safely through it Funding Options has set up a green finance marketplace. Its aim is to bring together companies that offer sustainable and environmentally friendly products and services with lenders which have authentically green policies or which offer financial products specifically designed to fund the purchase or leasing of green assets.
Simon believes that the green boom has developed an unstoppable momentum.
The climate crisis is sure to remain a key concern for organisations and individuals for many years to come, and any business that plans to survive and prosper in the coming decades will need to adopt a sustainable business model.