Sustainability KPIs for SMEs: What to Track in 2026

As sustainability continues to move from a “nice to have” to a business essential, many SMEs are asking a practical question: how do we know if we’re actually making progress?

That’s where sustainability KPIs come in. KPIs (Key Performance Indicators) are simply the measures you use to track performance over time. In sustainability terms, they help turn intentions into action by showing what’s improving, what isn’t, and where effort is best spent.

In 2026, sustainability KPIs will be increasingly important for UK SMEs, not just for environmental reasons, but for cost control, customer trust and long-term resilience.

Why sustainability KPIs matter more than ever

Without measurement, sustainability efforts can easily lose momentum. KPIs create focus and accountability, helping businesses move beyond one-off initiatives to sustained improvement.

For SMEs, the benefits of tracking sustainability KPIs include:

• identifying cost-saving opportunities (especially around energy, waste and water)

• supporting tender bids and supplier questionnaires

• responding confidently to customer sustainability questions

• preparing for future regulation without over-engineering today

Just as importantly, KPIs help SMEs demonstrate progress without needing to claim perfection. Showing improvement year on year is often far more valuable than trying to look “fully sustainable” overnight.

Start with what you can measure and control

One of the biggest mistakes SMEs make is assuming sustainability KPIs must be complex or technical. In reality, the most effective KPIs are often based on data you already collect.

In 2026, most SMEs should start with operational metrics that link directly to day-to-day activity and costs. These typically include energy use, waste, water and travel. Tracking these consistently can reveal trends that would otherwise go unnoticed.

For example, monitoring monthly electricity and gas consumption can highlight seasonal spikes, inefficient equipment or behavioural issues. Waste data can show whether recycling initiatives are working or if disposal costs are creeping up. Water usage may seem less urgent in the UK, but rising costs and supply pressures mean it’s increasingly relevant.

These metrics are simple, practical and meaningful, particularly for SMEs at an early or mid stage of their sustainability journey.

Carbon KPIs: keep them proportionate and practical

Carbon measurement is often seen as the gold standard of sustainability reporting, but it can also feel daunting. The good news is that carbon KPIs don’t have to be perfect to be useful.

If your business already calculates a carbon footprint, your KPIs might include:

• total emissions (measured in CO₂e — carbon dioxide equivalent)

• emissions per employee

• emissions per £ of revenue

These intensity-based measures are particularly helpful for growing SMEs, as they reflect efficiency rather than absolute size.

If you don’t yet calculate emissions, that’s okay. Energy and fuel consumption are widely accepted proxy metrics and can form the foundation of future carbon reporting. What matters most is consistency, tracking the same data in the same way over time.

Don’t overlook people and culture metrics

Sustainability performance isn’t only about meters and invoices. In many SMEs, real progress depends on peopl, how teams work, travel, use resources and make decisions.

In 2026, more SMEs are beginning to track people-focused sustainability KPIs alongside environmental ones. These may include participation in sustainability initiatives, attendance at training sessions, or the number of improvement ideas submitted by staff.

While these indicators are less precise, they provide valuable insight into whether sustainability is becoming part of everyday business culture rather than a side project led by one person.

Align KPIs with your business goals

The most effective sustainability KPIs are those that support wider business priorities. There’s little value in tracking data that doesn’t inform decisions or action.

If your main goal is reducing costs, focus on energy efficiency and waste reduction metrics. If winning contracts is a priority, ensure you track the data most commonly requested in tenders. If staff engagement is a challenge, include KPIs that reflect participation and awareness.

It’s also important to review your KPIs regularly. As your sustainability strategy matures, what you measure may change. What’s appropriate in early 2026 may look very different by 2028, and that’s a sign of progress, not failure.

Keep it simple and consistent

A common misconception is that more KPIs mean better sustainability management. In reality, a small number of well-chosen metrics is far more effective.

For most SMEs, tracking five to ten sustainability KPIs is more than enough. The key is consistency, measuring the same indicators in the same way, and reviewing them at least annually.

Progress beats perfection

In 2026, SMEs don’t need flawless sustainability data. They need data that’s useful, credible and improving.

Sustainability KPIs are not about creating extra admin or chasing unrealistic targets. They’re about understanding your impact, making smarter decisions and building confidence over time.

Start simple, focus on what matters most to your business, and use what you learn to keep moving forward.