Practicality essential to achieving environmental sustainability goals

Recent reviews and inquiries looking at single use plastics, packaging regulation and opportunities in the circular economy highlight the urgent need to transition towards more sustainable practices. These efforts aim to address pressing environmental challenges, but their success hinges on engaging small businesses as active partners in driving change.

Many small businesses are already motivated to adopt sustainable practices, responding to the preferences of their customers as well as their sense of responsibility to both the community and the natural environment. 

The success of past initiatives such as the implementation of initiatives under the NSW Plastic Action Plan, which phased out a range of single use plastic items, provides some important guidance for achieving success. What worked well in this example, was the engagement between industry and regulators especially in identifying non-plastic alternatives along with practical pathways to achieving compliance.

However, it is also important to be respectful of the operating circumstances facing many of our small businesses, including potential challenges associated with poorly designed requirements that do little in regard to actually delivering more sustainable outcomes. 

Some floated proposals, such as compelling small businesses to display signage and requiring cafes to accept reusable coffee cups, sound sensible at first glance but could create unintended consequences impacting some small businesses. If proposals such as these are to proceed, it should be because we are confident they are supported by evidence and not simply because it is comforting to be seen to be taking action.

Small businesses are not typically a major contributor to the waste stream, so it is appropriate to tailor regulatory requirements in recognition of their contribution to the problem. It may even be appropriate to exempt small businesses from more onerous and complex regulatory regimes designed with larger entities in mind. This includes retention of the existing $5 million turnover threshold applying to the regulation of packaging waste under the National Environment Protection Measures, recognising the cost of requiring smaller entities to comply may exceed the associated benefits. 

Small businesses need to be genuinely included in the policy-making journey through meaningful consultation and co-design. In my recent report Rightsizing Regulation, the Commission advocates for small business perspectives to be harnessed throughout the policy development cycle. This includes ensuring a proper understanding of impacts and engagement with the small business sector on regulatory proposals. 

It is important that policymakers are examining these important issues, and we should implement improvements to regulation where there is clear and compelling evidence. By bringing small businesses into the tent, policymakers are more likely to achieve successful outcomes by ensuring regulation meets their needs and is supported. 

Failing to take small business perspectives into account risks jeopardising support and the effectiveness of reforms.