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Green Energy Legislation – How your business can keep up
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Britain’s commitment to its net zero targets has been called into jeopardy in recent weeks. Internal divisions within the Conservative party have seen Rishi Sunak look to weaken some of the nation’s commitments to reaching net zero emissions.

However, evidence shows that customers remain more environmentally conscious than ever. A Deloitte survey found that 35% of UK adults were more likely to trust a business with a transparent, accountable and socially and environmentally responsible supply chain.

So, what can your business do to maintain or grow its sustainability credentials whilst staying in line with green and traditional legislation? The asset finance experts at Anglo Scottish Finance discuss some of the steps UK businesses can take to protect themselves against ever-changing legislation.

Why operating sustainably is more important than ever

In spite of the Conservative party’s stance on the nation’s net zero targets, strong green credentials remain crucial for businesses to appeal to an increasingly eco-conscious public. 29% of UK adults are likely to prioritise a business with a strong public perception, record and reputation around climate change and sustainability over a business without.

It’s not just B2C businesses that have grounds to be concerned. UK companies operating internationally should also be watching the situation closely. The new proposal threatens to undermine UK investment from abroad and weaken our international standing with clients and business partners alike, leaving business leaders furious and investors ‘spooked’.

The EU’s Carbon Border Adjustment Mechanism came into play in October 2023, creating a further divergence between the UK and Europe’s green legislation. EU companies are now responsible for compiling reports on the carbon emissions attached to certain goods, such as steel, aluminium and fertilisers.

So, though the British government may be content with relaxing our net zero commitments, UK businesses operating in Europe cannot be. The onus has been placed upon UK businesses to increase their sustainability credentials or risk being left behind.

Interrogate your operating practices

Companies looking to operate more sustainably are often faced with the initial challenge of identifying exactly where and how the company can become greener. Modern software solutions, however, are making this simpler.

Products such as Microsoft’s Sustainability Manager have given businesses the tools to interrogate their own working practices, acting as a hub for data intelligence from across the organisation. Allowing business owners to precisely calculate the sources of their emissions, this tool enables organisations to record, report and actively reduce their environmental impact.

This level of visibility is a huge benefit to businesses operating in a range of different countries. Even before the Prime Minister’s latest comments, concerns persisted about the UK’s failure to align its sustainability rules with the EU and US.

With the implementation of the EU green tax, international alignment of your business’s green policies is more important than ever. Sustainability Manager allows total visibility over emissions in an international supply chain, allowing your company to strengthen its foothold in the green economy.

Maximise your impact with collaboration – safely

This month, the Competition and Markets Authority (CMA) released new guidance to help businesses better understand how they can collaborate to meet sustainability goals without falling foul of competition law. The Green Agreements Guidance explains how competition law applies to sustainability agreements between firms operating at the same level of the supply chain.

Such examples might include farmers aiming to improve or protect biodiversity by reducing usage of pesticides, or fashion companies agreeing to stop using certain fabrics that contribute to microplastic pollution.

The impact that multiple businesses can have on the environment outranks that of a single business in isolation, so collaboration can be a strong route to improve sustainability practices – but it’s important to do so legally. The CMA has adopted an ‘open-door policy’ regarding business collaboration in the name of sustainability, so be sure to consult them before carrying out a project like this.

Avoid greenwashing – or pay the price

There’s no substitute for real, meaningful change. Given the importance of sustainability to the consumer, some less scrupulous businesses have been caught out by greenwashing – using unproven environmental assertions to sell products or enhance their public perception.

Earlier in 2023, the CMA were given new powers to impose direct civil penalties on companies who have been making misleading environmental claims. Your business could face fines of up to 10% of global turnover for breaches of consumer law in this manner – so any claims related to your business’s sustainability credentials must be thoroughly investigated before going public.

Support the sustainability push with external funding

In many cases, making your business more sustainable is an endeavour which requires significant operational change – and implementing such change can be a costly investment. Businesses should not be afraid of utilising external facilities like green loans or bonds to realise these changes.

Green loans and bonds are subject to an international standard known as the Green Loan Principles, which ensure the transparency of your borrowing and the environmental impact of your changes. This can protect your business against accusations of greenwashing and keep you focused on the task at hand.

Global green finance increased tenfold between 2012 and 2022, indicating just how many businesses are utilising external funding to become more sustainable. Don’t be afraid to explore your options – improving your sustainability credentials could be more achievable than expected.

Charlotte Enright, Head of Renewables at Anglo Scottish, commented: “In light of these changes to the UK’s renewable commitments, it can be difficult for UK businesses to keep informed on their responsibilities. That’s why it’s more important than ever for these companies to be proactive and drive change from within.”

Photo by Micah Hallahan on Unsplash

Bizarre Financing: Experts reveal the strangest financed assets
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Financing goods is an understandable practice – especially for high-value items that you or your business may struggle to pay off in one go.

As time has gone on, financing has become increasingly popular. Checkout repayment services such as Klarna, PayPal Credit and Sezzle have made even the most mundane items financeable – from toothbrushes to shampoo.

But what about the less mundane, the specialist and the downright bizarre financed items? We spoke to the asset finance specialists at Anglo Scottish to get an insider perspective into the occasionally strange world of B2B financing.

These are the financed items that have stuck in their minds.

Equine saltwater treadmill

Financed for a whopping £200,000, this treadmill is a little different from your standard gym equipment. An equine water treadmill is used for the rehabilitation and training of horses, particularly to help improve aerobic muscles.

Financing this kind of specialist equipment is understandable – they don’t come cheap, and if you have an injured horse then it’s likely you’ll need one in a hurry. It’s still a really niche item and definitely deserves a spot on the list.

Diving equipment

Some of the most popular items to finance are cars – getting from A to B quickly is a must for many with commuting jobs. Unless you work in Atlantis, you’re far less likely to finance diving equipment, but that’s exactly what a few businesses have done.

Diving equipment is expensive, but it really adds up once you take into account the full gear. Underwater cameras and video lights, torches, dive computers, scuba gear and more can quickly rack up a huge price tag – so financing this equipment seems much more normal once you consider the full cost.

1927 Fairground organ

Coming up to a century old, a 1927 fairground organ was bought on finance by one lucky buyer. Often auctioned, these instruments can be incredibly expensive (one eBay listing has a vintage organ listed for almost £19,000!) and are sought after by collectors and enthusiasts alike.

They’re either charming or creepy, depending on who you ask. One thing’s for sure, it’s definitely not your usual financed purchase.

Cow pop

One of the more disgusting concoctions you could dream up, cow pop is essentially a cow slurry that’s converted into energy via renewables. As gross as it might seem, there are plenty of positive ways in which a cow pop biofuel could be used.

There’s plenty of demand for green finance solutions from modern businesses looking to reduce their carbon footprint or become more sustainable – but these finance agreements are usually reserved for more traditional forms of green energy like solar panels…

We’ll trust in the process with this one.

Inflatable obstacle course

Who doesn’t love an obstacle course? This bit of kit was financed by a company looking to organise an action-packed team-building day.

A team-building activity that can also be done at a child’s birthday party is usually a good sign that your company does work outings correctly. Next time your office’s Christmas party organiser is getting worried about costs, point them to a reliable broker!

100 portable toilets

Ideal for pairing with your big obstacle course team-building day, one company financed 100 portable toilets. Your bog-standard portable toilets are usually hired for around £50 a fortnight, rather than being bought outright.

For businesses that organise lots of large-scale events, it makes sense to buy portable toilets to save on hiring costs. As strange as it seems at first glance, financing may be the best way to go when organising events in a hurry.

Ferris wheel

The largest item on this list, one company bought a £300,000 Ferris wheel on finance. Probably one of the more difficult items to repossess if payments stopped, financing a Ferris wheel is a testament to how far financing has come in recent years.

If you can buy it – you can probably finance it.

Fish insemination machine

Saving the strangest for last, a company bought an artificial insemination machine for use on fish. Research equipment is very expensive, so financing is a good option when a substantial outlay like this can hurt the company’s cash flow.

The machine in question used injections to inseminate fish eggs – lovely. Financing such an item certainly makes explaining your company’s direct debit statement a bit easier for the finance team.

There we have it, the weirdest and most unexpected financed items recalled by industry experts. Financing has become so versatile that it’s worth considering for the needs of any business or individual, especially when in a hurry.

Next time you’re unsure if your business card can take the strain, perhaps it’s time for you to consider financing.

Photo by Towfiqu barbhuiya on Unsplash

Could FM financing solutions save our High Streets?
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By Rob Marriott, Marketing & Strategic Bid Director at SPIE UK

The recent news about Debenhams falling into administration is just another nail in the coffin for the British High Street. Part of the problem can be attributed to retailers’ legacy estates. Swelling rents, wage hikes, long lease periods and aging property in urgent need of upgrading are all contributing factors.

However, retailers are struggling to find budget to overcome these problems. 

Sometimes heralded as the panacea, new smart technology installed throughout shops, warehouses etc. would give retailers additional useful data which could help them manage their operations more efficiently. Benefits of this approach could include reducing how much energy is used, improving staff wellbeing, implementing predictive maintenance and enhancing the customer experience, which would all help contribute to lowering long-term operating costs. Unfortunately, organisations are being held back in the short term by the hefty up-front costs that this sort of technology investment requires, as well as the need to provide leadership teams with a robust business case for its installation. 

However, facilities management (FM) firms could have the solution. Some of these companies are starting to develop new financing solutions which are founded on a single lease purchase agreement. As such, machinery, fixtures and fittings etc. don’t have to be capitalised or purchased by the retailer. Instead, merchants can buy them on an on-balance provision instead of the traditional off-balance sheet capitalisation. FM companies would be able to then build upon this idea by creating a completely new model, whereby retailers will not be shackled by lengthy leases that they have previously been used to. As well as being able to lease the property from a third party, these businesses will also have the ability to lease everything within it too – from IoT hardware right through to lighting. 

If we take a retailer that wants to fit out twenty new sites, as well as fully supply and maintain them whilst being certain of the operating costs, the FM organisation would create a plan where they organise the installation and maintenance of the equipment on a fixed annual fee basis. By providing a fully comprehensive offering, not only will this guarantee budget certainty for the retailer, but also helps with peace of mind. 

One of the main benefits of this new type of model is that retailers will be able to predict their income more precisely. By operating in a fixed cost environment, these companies will have more confidence in their ability to plan for future investment in innovation and new ways of working. It is much trickier to invest in new technologies and leverage efficiencies when you have a less predictable maintenance spend. In addition, paying for everything in one easy payment on a fixed basis means retailers can better forecast and plot what their cost profile might look like over the next three-to-five-year years. Of course, this makes it even more straightforward when calculating future investment funding.

Once retailers have been able to finance the installation of state-of-the-art equipment, both they and the FM company in charge of the premises can reap the benefits of the increased amounts of data this will create. The information can be tapped in a number of ways to generate an improved working environment and better customer service. Data can be used to build a more detailed understanding about how the premises are being utilised. As a result, everyone can implement new initiatives to achieve greater energy efficiency. What’s more, the FM company will be able to provide a better service level by leveraging tools such as predictive maintenance. By identifying when machinery and facilities are going to breakdown before the event actually occurs, they can reduce disruptions and improve the return on investment for the retailer. Not only that, but reducing disruption also improves the customer experience, helping the retailer to strengthen their brand image. In short, greater information on and overall visibility of the premises results in more efficient management and maintenance. 

Within retail there are some examples of this model being used with the purchase of single assets, for example the leasing of their EPOS till systems, flooring, fixtures within site, and lighting. Within an organisation, different departments will procure items including shelving and mannequins from various suppliers. And yet, there is nobody currently in the market who has combined these services together to create one single purchasing offer. This presents facilities management companies with an enormous opportunity. FM companies are not limited in what they can source a supplier for, but such change demands a transition away from traditional procurement strategies when forecasting the opening of new stores or refurbishing existing facilities. 

Multiple site High Street retailers are best placed to generate value from these new financing plans because they have the sufficient critical mass to deliver scaled saving across their portfolio. For an independent retailer, it would be a lot harder to achieve similar results and savings if they only had one shop or warehouse to deliver them. For those companies with multiple sites, once they have rolled out the new financing model they can benefit from economies of scale. Following the introduction and successful implementation of a one site model, practices be reviewed, standardised and rolled out across other sites. Evidently, this is why organisations who have larger regional, national or even international foot prints are more likely to benefit.

There are myriad advantages to this way of working for FM companies: the capacity to maintain equipment to the right operating standard, a more predictable income, and a better environment and customer experience. This means the FM company is more efficient and makes better use of its resources, also customers won’t need to waste time following up with suppliers.

These new bespoke financing solutions are already being developed by some FM companies with their retail clients. In the same way that car dealerships lease their vehicles to consumers, we will soon see the retail industry undergo somewhat of a transformation in terms of how their premises are managed, maintained and leased. As the retail industry continues to digitally transform and evolve into a multichannel environment, all being well, these new financing techniques will be able help these organisation adapt and thrive.