Many growing businesses have had to reduce their environmental expenditure in order to cut costs.

Many growing businesses have had to reduce their environmental expenditure in order to cut costs.

Some 16 per cent of SMEs say they have spent less on environmental measures this year as many need to concentrate on cash flow. Ten per cent said they could not make changes due to restrictions on their premises and 4 per cent were unaware of what changes to make, according to research from Abbey and Alliance & Leicester.

Paula Ickinger, head of business banking marketing at Abbey and Alliance & Leicester, says: ‘Many green initiatives incur a significant up front cost, which can be off-putting but in the longer term they can help to reduce overheads as well as carbon emissions.’

However, of the 300 businesses surveyed a quarter (26 per cent) said they are giving a higher priority to environmental issues this year.

Dragons’ Den investor Theo Paphitis recently called for businesses to replace old equipment with energy-saving technology with loans through the Carbon Trust. He said: ‘With interest-free funding available to replace equipment, leading to average energy savings of 15 per cent, it’s a no-brainer for businesses to join in.’