Written by Joanne Hughes, Policy & Compliance Specialist at Policy Pros
Last reviewed:
Writing Sustainability Policies
What Is a Sustainability Policy and Why Does Your Business Need One?
A sustainability policy is a formal document that sets out how an organisation manages its environmental impact, reduces carbon emissions, operates a responsible supply chain, and contributes positively to the communities in which it works. In the United Kingdom, sustainability policies have moved from being a voluntary demonstration of good corporate citizenship to a regulatory and commercial necessity.
The Environment Act 2021 established a comprehensive legal framework for environmental governance in England, including legally binding targets for air quality, water, biodiversity, and waste reduction. The Act created the Office for Environmental Protection (OEP) as an independent body with enforcement powers, and it places duties on public authorities to consider the environmental principles policy statement when making policy decisions. For businesses, the Environment Act 2021 reinforces the expectation that environmental impact is managed, measured, and reported.
Beyond legislation, sustainability policies are increasingly demanded by customers, investors, and supply chain partners. Organisations bidding for public sector contracts in England and Wales will be assessed on their social value commitments under the Social Value Act 2012 (formally the Public Services (Social Value) Act 2012) and the Cabinet Office's Procurement Policy Note 06/20 (PPN 06/20), which requires all central government procurement to evaluate social value as a minimum of 10 per cent of the total score. A credible sustainability policy is often the foundation of a winning tender bid.
What a Sustainability Policy Must Cover
An effective sustainability policy should address the following areas, tailored to the size, sector, and operational footprint of the organisation:
Environmental impact and carbon reduction: The policy should set out the organisation's commitment to measuring and reducing its environmental footprint. This includes greenhouse gas emissions across Scope 1 (direct emissions from owned or controlled sources), Scope 2 (indirect emissions from purchased energy), and, where material, Scope 3 (all other indirect emissions in the value chain). Many organisations are now setting net zero targets aligned to the UK Government's commitment to achieve net zero greenhouse gas emissions by 2050.
Supply chain sustainability: The policy should describe how the organisation assesses and manages the environmental and social performance of its suppliers and subcontractors. This may include supplier codes of conduct, sustainability questionnaires, environmental auditing, and alignment with the Modern Slavery Act 2015 to ensure supply chains are free from forced labour and exploitation.
Social value: Social value refers to the broader social, economic, and environmental benefits that an organisation delivers beyond the direct terms of a contract. A sustainability policy should describe the organisation's approach to creating social value, including local employment, skills development, community engagement, and support for SMEs and social enterprises.
Waste management and circular economy: The policy should cover waste minimisation, recycling, responsible disposal of hazardous materials, and efforts to adopt circular economy principles (designing out waste, keeping products and materials in use, and regenerating natural systems).
Water stewardship and biodiversity: Organisations should consider their water consumption and discharge, and their impact on local biodiversity. The Environment Act 2021 introduced a mandatory requirement for biodiversity net gain in the planning system, and businesses with significant land use should address biodiversity in their sustainability policies.
Legal Requirements vs Best Practice by Company Size
The legal obligations relating to sustainability reporting in the UK vary significantly depending on the size and type of organisation.
Streamlined Energy and Carbon Reporting (SECR): The SECR regulations, which came into effect on 1 April 2019, require qualifying UK companies to report their energy use and carbon emissions in their annual directors' reports. The SECR thresholds apply to large unquoted companies and LLPs that meet at least two of the following criteria: 250 or more employees, annual turnover of £36 million or more, or an annual balance sheet total of £18 million or more. Quoted companies of any size are also required to report under SECR. The report must include the organisation's UK energy consumption in kilowatt hours, associated greenhouse gas emissions in tonnes of carbon dioxide equivalent (tCO2e), and an intensity ratio (such as emissions per employee or per unit of revenue).
Companies Act 2006: Under section 172 of the Companies Act 2006, directors of large companies are required to have regard to the impact of the company's operations on the community and the environment. Large companies must also produce a strategic report that includes information about environmental matters, employees, social and community issues, and human rights, to the extent necessary for an understanding of the development, performance, or position of the company.
SMEs: While smaller businesses are not subject to SECR or section 172 reporting requirements, they are increasingly expected to demonstrate sustainability credentials when bidding for contracts, joining supply chains of larger organisations, or seeking investment. A well-written sustainability policy positions an SME as a responsible and forward-thinking partner, even where reporting is not legally mandated.
How Sustainability Policies Support Tender Bids
For organisations bidding on public sector contracts, sustainability is no longer a nice-to-have — it is a scored criterion. The Social Value Act 2012 requires public authorities in England and Wales to consider how the services they procure might improve the economic, social, and environmental wellbeing of the relevant area. Since the introduction of PPN 06/20 in January 2021, all central government departments must evaluate social value as a minimum of 10 per cent of the total tender score.
The Social Value Model set out in PPN 06/20 identifies five key themes against which bids are assessed: COVID-19 recovery, tackling economic inequality, fighting climate change, equal opportunity, and wellbeing. A sustainability policy that addresses carbon reduction, environmental management, and supply chain responsibility directly supports responses to the climate change and economic inequality themes.
Private sector supply chains are also increasingly demanding evidence of sustainability from their suppliers. Many large organisations, including those in construction, professional services, and manufacturing, require suppliers to hold environmental management certifications (such as ISO 14001) or to demonstrate compliance with sustainability standards as a condition of tendering. A Policy Pros sustainability policy provides the documented evidence you need to meet these requirements.
Net Zero Policy Writing
A net zero policy is a specific commitment to achieving net zero greenhouse gas emissions by a defined target date. For many UK businesses, this target is aligned to the UK Government's legally binding commitment under the Climate Change Act 2008 (as amended by the 2019 Order) to achieve net zero emissions by 2050, with an interim target of a 78 per cent reduction by 2035 against 1990 levels.
A net zero policy should include a baseline assessment of current emissions, a clear reduction pathway, interim targets, and a commitment to offsetting only those residual emissions that cannot be eliminated. It should also set out governance arrangements, including board-level responsibility for climate strategy, and reporting mechanisms to track progress against targets.
Policy Pros helps organisations draft net zero policies that are credible, measurable, and aligned to recognised frameworks such as the Science Based Targets initiative (SBTi) and the Task Force on Climate-related Financial Disclosures (TCFD).
Link to ESG Reporting
Sustainability policies are a core component of an organisation's broader Environmental, Social, and Governance (ESG) framework. ESG reporting provides stakeholders — including investors, customers, employees, and regulators — with a transparent account of how the organisation manages environmental risks and opportunities, treats its workforce and communities, and governs itself.
For many organisations, the sustainability policy is the starting point for developing a comprehensive ESG documentation suite. Policy Pros works with businesses to ensure that sustainability policies are integrated with ESG reporting requirements, avoiding duplication and ensuring consistency across all public-facing commitments.
How Policy Pros Can Help with Sustainability Policies
Policy Pros has extensive experience writing sustainability policies for UK businesses across a wide range of sectors, including construction, professional services, technology, manufacturing, and the public sector. We write policies that are aligned to the Environment Act 2021, the Companies Act 2006, the Social Value Act 2012, and the SECR regulations, and that support your tender and RFP submissions with credible, evidenced commitments.
Whether you need a standalone sustainability policy, a net zero commitment statement, or a full ESG policy suite, our team will work with you to understand your operations, supply chain, and commercial objectives, and produce documentation that is practical, professional, and fit for purpose.
Contact Policy Pros today to discuss your sustainability policy requirements.
