Virgin Money has introduced a new app focused on providing an assessment of a companies’ ESG impacts by measuring, tracking and offering guidance.
Through its partnership with the Future-Fit Foundation, the Sustainable Business Coach will look to help UK companies manage their sustainability goals.
According to Virgin, the Sustainable Business Coach app ‘identifies the high-priority goals a business should consider and provides an objective assessment of the positive and negative ESG impacts of its activities’. The tool provides users with a score and actionable guidance, and has been designed to be updated intermittently, encouraging businesses to track their ESG progress over time.
As more and more companies are finding requirements to report their ESG impact, Virgin claims this app is an ‘easy first step’ to help firms of any size get started and track and demonstrate their progress.
Virgin is also planning to provide sustainability-linked loans to firms who are able to meet the eligibility criteria generated by the outputs from the Sustainable Business Coach.
The loan helps to cut the cost of finance for companies whose core activities support consumers and other firms in operating in a more economically and environmentally sustainable way.
Virgin Money claims it is the first bank in Europe to offer such loans in commercial banking through using science-based methodology. Companies who are borrowing at least £250,000 can face no arrangement fee if they have a sufficiently strong ESG assessment.
Graeme Sands, Interim Head of Business Banking, at Virgin Money, said: “We are committed to working with businesses to help them grow and thrive, and one area where many need support is on their ESG strategy. Businesses recognise the importance of sustainability to their long-term success but many, especially smaller firms, can face challenges getting started, setting targets and making positive progress.
“We designed the Sustainable Business Coach to help businesses with this process, giving them the information and guidance they need to operate more sustainably. It can be completed periodically, so becomes an effective benchmark to track progress over time. We have made the app available to any UK business, not just our customers, as work in the ESG space should be about collaboration and sharing best practice – we must all play our part in becoming more sustainable.”
Virgin Money added that the tool comes at a ‘pivotal time’ as firm assess their ESG efforts to support net-zero goals. Recent research by the organisation found that becoming more sustainable is important to a clear majority – 85% – of UK SMEs. Despite this, only 43% of the SMEs are managing to implement clear ESG targets.
Virgin Money, as part of its own ESG strategy, has committed that 5% of all its business loans will be to companies driving environmental and social change by September next year – as judged by the Sustainable Business Coach.
Elsewhere in the ESG space, invoice financing marketplace Incomlend and Fasanara Capital recently teamed to launch a global alternative financing program for SMEs focused on ESG.
The program – named the Incomlend ESG Invoice Financing Programme – will provide £44.14m in financing for SMEs who are looking to positively impact their communities while also looking to capture new business opportunities and grow their revenue.
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