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16th May 2022

Business Matters: Role of Northern businesses in creating a low carbon future

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Northern Powerhouse Investment Fund

Sean Hutchinson, Senior Investment Manager at the British Business Bank, discusses the importance of building a green future and how the Northern Powerhouse Investment Fund is helping to deliver a low carbon northern economy through its investment support for businesses across the North of England.

As operating costs continue to soar, it is easy to lose sight of the all-important role that the business community must play when it comes to reducing carbon emissions and meeting sustainability targets. Not only will this help to reduce the impact of climate change, but it can generate new business opportunities and reduce operating costs.

Last year, the British Business Bank compiled its ‘Smaller businesses and the transition to net zero’ report, that shone a light onto the impact smaller businesses in the UK have on the environment, including their attitudes towards prioritising carbon reduction. The report revealed that smaller businesses account for half of all UK business-driven emissions, and that the most commonly perceived barriers to action were cost, feasibility, and a lack of information.

This is where targeted support, through initiatives such as the Northern Powerhouse Investment Fund (NPIF), have a key role to play. Equipping small businesses with the right tools, such as access to finance, will enable our northern business community to actively engage in a mission to reach net zero targets by 2050.

Across its portfolio, NPIF provides support to a host of businesses that provide sustainable solutions through either their services or products. This ranges from providing sustainable alternatives to consumers, or offering new solutions to businesses seeking to become greener or more efficient.

Cheshire-based Pura is a prime example of this in action. Pura is a fast-growing baby care brand which specialises in eco-friendly baby wipes and nappies. After discovering the amount of plastic contained in disposable baby products, its founders created an affordable, eco-friendly alternative that reduced waste and was easily biodegradable. After securing investment in a round led by NPIF – Maven Equity Finance in February, Pura is disrupting the sector and is now targeting international growth. It is a demonstration of a small business that has spotted a sustainability-driven market opportunity, and utilised access to finance to grow.

Not only does NPIF support businesses that offer green products, but it also facilitates positive change in organisations that strive to transform processes within the industries they operate in. This can range from enabling the purchase of more eco-friendly equipment in a manufacturing business, to facilitating the research & development of new solutions.

The Materials Processing Institute (MPI), a not-for-profit research and innovation centre based in Middlesbrough, is an NPIF-backed business doing just that. It secured a £750,000 investment from NPIF – FW Capital Debt Finance in 2021, utilising funds to improve its research capabilities and rapidly accelerate industrial innovations, with a greater focus on decarbonisation and the production of new digital tools.

Both Pura and MPI are great case studies of NPIF-backed small businesses that are actively creating a low carbon future through access to finance, in contrasting ways. They are both a clear demonstration of how sustainability is not a box ticking exercise, and can present new business opportunities.

Businesses are at the heart of a decarbonised future and the Northern Powerhouse Investment Fund is committed to helping the many high potential and exciting businesses here in the North of England, as we look to create a more sustainable future.

The Northern Powerhouse Investment Fund project is supported financially by the European Union using funding from the European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020 and the European Investment Bank.