Your guide to creating an effective environmental policy

Your environment

In today’s eco-conscious world, a well-defined Environmental Policy is crucial for any business looking to showcase its commitment to sustainability. The guide is designed for leaders and sustainability advocates eager to minimise their environmental impact and work with public and private sector companies.

What is an environmental policy

A policy is a short document which confirms an organisation’s commitments and a course of action to be taken to put them into practice.

For an environmental policy this means that organisations should set out their stance on environmental protection, how they plan to reduce their environmental impacts and comply with relevant laws and regulations.

Benefits of having an environmental policy

An environmental policy is important to demonstrate your organisation’s commitment both to your internal stakeholders (for example your staff) and external stakeholders (for example your clients). It can also act as a foundation to set objectives, targets, and action plans to reduce your environmental impacts.

Increasingly both public and private sector customers want to see environmental policies to ensure their supply chains have governance around their environmental performance.

When to develop a policy

If it’s the first time…

Before you start to write an environment policy it’s important that you’ve already established what aspects of your business activities impact the most on the environment, either positively or negatively. In other words, what are the ‘material’ environmental impacts for your business. For example, it could be your business travel or energy usage.

We’d recommend measuring your carbon footprint as you’ll be able to build a better understanding of your material impacts. If you haven’t done this yet you should have a rough idea of where your business is making the biggest impact on the planet.

You’ll want to develop the policy when you have buy-in from seniors and know that this is something that will be taken seriously and will be embedded across all business’ operations. You’ll need to sit down with key people in your company to map the inputs and outputs of your business.

If you have a policy already…

Even if you have a policy in place, there are key moments when you should think about revisiting it. The start of strategic planning cycles is a good moment, and don’t forget to look at it again if there have been significant changes to your business, such as a merger. 

Some tips on how to structure your environmental policy

There’s no legal requirement to have an environmental policy or a set format to follow, but it is a requirement of the international ISO 14001 environmental management system standard and considered best practice to have in place.

At a minimum you should aim for your policy to commit to:

  1. Reducing your environmental impact
  2. Compliance of relevant environmental laws;
  3. Continuous improvement.

Think about setting the scene of your environmental policy by opening with a short introduction to your organisation and its key activities. Your second paragraph could outline what you believe your business’ main impacts are on the environment. Next, you could have a brief overview of the work you’re doing to reduce your impact. At the end the policy could include an endorsement and signature by the organisation’s most senior representative, such as the CEO, and a publication or review date.

Don’t forget that the environmental policy will help communicate to your team the business’ commitments and expected requirements from them. You’ll want it to be easy to understand and show how they’ll contribute to your business’ environmental goals.

Things to remember

  • Keep it short and concise. If Unilever can keep their policy to two pages, anyone can.
  • As an SME, external stakeholders will expect you to deliver change proportionate to your size. Don’t feel you need to match the amount of initiatives outlined by larger companies!
  • You can get inspiration from looking at other companies’ environmental policies but your environment impacts (be that; resource use, water use, energy use, waste etc) and the materiality of each will be unique to your company, so make sure your policy reflects this.
  • If you’ve already adopted environmental related external frameworks such as UNGC, BCorp, or ISOs, you could elaborate on how these fit into your policy.
  • It’s good practice to review your policy annually but you want to avoid having to make frequent updates. To avoid this and increase the longevity of the policy, avoid naming people (except the signatory) and it’s ok to give a high-level overview of the work you’re doing rather that detailing each item.
  • Sustainability policies may include an environmental policy, as well as allowing businesses to talk about their social commitments. Examples of social commitments could be things such as paying the living wage, training opportunities provided to employees or buying from local suppliers.

Examples of environmental and sustainability policies:

Larger corporates


This was last updated in February 2024  by Heart of the City. We’ve created these resources for individual SMEs to use. None of our content is to be adapted, reused or repurposed for commercial use.