Green finance: turning sustainability into business value

For many SMEs, the question is no longer just whether they need to make their business more sustainable, but how they can make the investment work commercially. With rising energy costs, changing customer expectations and pressure to remain competitive, the green transition is becoming an increasingly important business consideration.

Green finance is often associated with businesses pursuing ambitious net-zero targets. But in reality, many investment decisions are being driven by more immediate concerns: reducing overheads, improving productivity, strengthening energy security and ensuring a business is equipped for the future.

Solar panels, energy-efficient machinery, electric vehicles and charging infrastructure can all play a role. Depending on the business and the investment, these assets can help reduce emissions while delivering practical financial and operational benefits.

The scale of the opportunity is considerable. The British Business Bank’s 2025 SMEs and Net Zero report found that 77% of SMEs had already taken at least one action towards net zero, while 63% believed progress could deliver benefits for their organisation. SMEs also account for around 37% of the UK’s greenhouse gas emissions, demonstrating the important contribution they can make to the wider transition.

However, the willingness to invest does not always translate into action. Cost remains a significant obstacle. Ofgem’s 2025 research found that, among businesses facing barriers to decarbonisation, cost was the most commonly cited, at 15%.

For brokers, this creates an opportunity, but it does not mean they need to become experts in every emerging technology or understand every aspect of green finance.

You don’t need to have all the answers

A conversation about green investment should start with the needs of the business, rather than simply its sustainability objectives.

A manufacturer may be looking to replace ageing equipment that is expensive to run. A logistics company might need to upgrade its fleet, while another business could be considering solar to reduce its dependence on grid electricity. Each investment has a different starting point, and each requires a clear understanding of the commercial rationale.

The important thing for brokers is to recognise when a green investment may be part of the solution and start the conversation. They do not need to have all the answers at the outset.

Green technology is developing quickly and some projects can be complex. Understanding the asset, how it will be used and what the customer is trying to achieve is a good starting point. From there, specialist support can help assess the investment, the technology and the financing considerations.

This is where working with an experienced finance partner can make a difference. Brokers can bring the customer relationship and understanding of the business, while specialist green finance expertise can help navigate the detail around the proposed investment.

There is no standard approach to green investment. An SME installing solar panels will have different requirements from a manufacturer investing in energy-efficient machinery or a logistics business moving towards electric vehicles.

Bridging the gap between ambition and investment

One of the challenges facing businesses is the perception that green investment is complicated or beyond their financial reach. While some projects will require significant planning and assessment, others involve relatively familiar assets that can support clear operational improvements.

Early conversations with finance providers can help businesses understand the costs involved, assess affordability and consider how an investment fits with their cash flow and wider objectives.

For brokers, this does not mean becoming a technical expert in solar generation, electric vehicles or energy-efficient machinery. It means asking the right questions about the customer’s plans and being prepared to bring in specialist knowledge where required.

At Haydock, our role is to support brokers through that process. If a customer raises a green finance requirement that is outside a broker’s day-to-day experience, there is no expectation that they should have an immediate answer. We can help explore the asset, understand the wider project and work through the financing considerations with the broker and their customer.

That support is particularly valuable when a project is more complex or involves technology that the broker may not have encountered before.

The growing importance of supply chain expectations

Sustainability is also becoming an increasingly important part of commercial relationships.

The British Business Bank’s latest research found that 37% of medium-sized businesses had been asked for carbon data by customers or as part of a tender exercise, compared with just 3% of businesses without employees.

As larger organisations introduce environmental requirements across their supply chains, SMEs may face increasing pressure to demonstrate progress. For some businesses, investment in sustainability could become important to securing new contracts, retaining customers and remaining competitive.

This adds another dimension to the green finance conversation. Environmental investment is not necessarily just about reducing emissions; it can also be about protecting future business opportunities and responding to changing market expectations.

For brokers, this represents an opportunity to broaden the conversation with customers. They don’t need to be the sustainability expert in the room. Their role can be to identify the requirement, understand the commercial driver and bring in the right expertise to help develop the opportunity.

Making the transition work for SMEs

The move towards a lower-carbon economy presents challenges, but it also creates opportunities for businesses to improve how they operate.

For the commercial finance industry, the focus should be on understanding the practical needs of customers and helping them assess investments that support both environmental and business objectives.

For brokers, the message is simple: don’t be put off by the term “green finance”. If a customer raises a requirement for solar, electric vehicles, charging infrastructure, energy-efficient machinery or another sustainability-related investment, start the conversation.

Green finance should not be viewed as something separate from mainstream business investment. Whether the aim is to reduce energy bills, improve productivity, modernise equipment or strengthen resilience, the underlying commercial principles remain the same.

The green transition will be most effective when businesses can see how environmental investment supports their bottom line. For brokers, having the confidence to start those conversations,  and access to the right expertise when they need it, will be increasingly important in helping SMEs navigate the opportunities ahead.