Beyond Banking

ESG Advisory as Beyond Banking Service | Banks as Holistic Sustainability Partners for SMEs

Sebastian Kaiser-Mühlecker
18 Mar 2024
5 min read

Essential Highlights

  • Necessity for sustainable transformation and ESG regulations put pressure on both banks and corporate clients.
  • Problem A: Financing obstacles and lack of strategic ESG knowledge hinder SMEs in their sustainable development.
  • Problem B: Regulated advisory business and shortage of skilled workers have so far prevented banks from comprehensively supporting SMEs in their sustainable transformation.
  • Solution: ESG advisory marketplace as a digital hub for ESG expertise connecting corporate clients and sustainability experts from the banking network.
  • Sustainable benefits for all involved stakeholders: SME clients, external ESG experts, banks.

Introduction | From "Scapegoat" to Enabler

The role of banks in the sustainable transformation of small and medium-sized enterprises (SMEs) is becoming increasingly crucial as various regulations such as the EU Taxonomy Regulation or the Corporate Sustainability Reporting Directive (CSRD) on the customer side and the Sustainable Finance Disclosure Regulation (SFDR) on the banking side, as well as the aspect of double materiality, clearly (will) have a significant impact on financing. To ensure that banks do not become the "scapegoat" for customers, complicating or rejecting loan applications due these regulations, it will be crucial to position themselves as enablers of sustainable transformation and as supporters on this challenging path. Given that context, this article sheds light on how important easy and affordable access to ESG expertise is for SMEs, what role banks can play as holistic sustainability companions for SMEs, and what opportunities this presents for all involved stakeholders.

YourBank ESG Advisory Hub | A Beyond Banking Demo Case by HalloSophia

The Challenge: SMEs and Sustainability

SMEs represent a significant segment of the European economy but face major challenges in managing their sustainable transformation. A study by Eurochambres (2023) shows that while nearly 60% of SMEs invest in their sustainable transition, they struggle with ensuring sufficient financing. Only 35% of their investments were funded through external sources, and just 16% of this external financing can be classified as sustainable financing (Eurochambres, 2023). In addition to these financial hurdles, SMEs also lack a comprehensive strategy and often the necessary knowledge to meet legislative requirements. According to a study by PricewaterhouseCoopers (2023), while there is a high willingness to undergo the green transformation, a holistic strategy and the ability to meet regulatory prerequisites are often missing (PwC, 2023).

Banks as Key Players in Sustainable Transformation

Established banks play a central role in the challenge of sustainable transformation of large economic sectors. By offering a comprehensive array of sustainable products and services, they can position themselves as key strategic partners for SMEs. In addition to green products like green loans and bonds, advice on sustainability topics and support with reporting are also focal points (Otto, 2024). A crucial aspect that makes established banks particularly well-suited to act as holistic sustainability partners, compared to other economic participants, is their unparalleled network of partners and experts with specific ESG expertise, in addition to their role as financiers.

Digital Marketplace for ESG Advisory as Beyond Banking Service

Through collaborations with their ESG network partners, banks can offer their SME clients unparalleled access to necessary sustainability expertise. Otto (2024) also emphasizes: "Collaborations between companies are the key to success in achieving necessary sustainability goals. With a comprehensive network of consulting collaborations, a so-called green ecosystem of sustainability expertise emerges, which corporate clients can access at any time on a topic-related basis" [transl. by K-M, S.] (Otto, 2024). One way for banks to achieve this in accordance with concessions and regulatory requirements is to establish a digital ESG service marketplace, where external sustainability consultants from the banking network are listed and offer microadvisory services that can be booked and conducted fully digitally. This platform would enable SMEs to easily and efficiently book tailored consulting services, significantly simplifying the implementation of ESG initiatives.

Benefits for SMEs, ESG Experts & Banks

A digital marketplace for ESG consulting model provides benefits for all involved stakeholders in this setting:

Barrier-free access to ESG expertise for SMEs

Many SMEs face the challenge that, due to their size, they often do not attract the attention of large consulting firms, and are thus "underserved" when it comes to implementing ESG-relevant topics. The digital ESG service marketplace addresses this issue by offering consulting services specifically tailored to the needs of these companies. This facilitates SMEs' access to valuable expertise and supports them in the sustainable transformation of their business models.

Efficient new business for external ESG partners / consultants

For ESG experts, the marketplace offers a platform to efficiently present their services to a wide audience and generate new business. The digital processing allows for an efficient and even (partially) scalable provision of their expertise.

Contribution to a bank's own ESG initiatives

By providing such a marketplace, banks not only contribute to promoting sustainability in the economy but also add an impactful initiative to their own ESG efforts.

Expansion of the customer base in ESG-compliant financing

Banks that offer such services increasingly attract customers whose financing projects comply with ESG-relevant regulations. This can subsequently have a positive impact on the acquisition of new B2B clients, thus strengthening the bank's position in the competitive financial sector.

Solution to the challenge of shortage in skilled labor

By having the services provided by external ESG experts through the digital marketplace, banks are able to offer SMEs easy access to specialized consulting services without being directly affected by the industry-wide shortage of skilled professionals. This ensures the continuous provision of high-quality services.

beyond24 - [Your Bank] Service Marketplace

beyond24 is a Beyond Banking demo case by HalloSophia. The demo showcases how banks can become the digital, intermediary hub for consultations and expert advice, provided by trusted network partners and individual consultants within their ecosystem. The service offering can be enhanced by listing internal financial specialists, who can be booked on-demand by both existing and new clients. The basis for this is the ConsulTech company's (HalloSophia) out-of-the-box solution, which operates all-in-one advisory portals including the necessary regulatory framework for other organizations under their branding (whitelabel). Overall, it is a groundbreaking, radically new concept with untapped potential for new business at the intersection of established banks' key assets. Explore beyond24 - [Your Bank] Service Marketplace.


Banks have a unique opportunity to play a central role in the sustainability transformation of SMEs by creating digital ESG service marketplaces and integrating external ESG experts into own channels. By acting as a digital hub, banks can minimize risks while simultaneously creating significant synergies that maximize value for SMEs, experts, and the bank itself. This strategy allows banks to go beyond traditional financing services (Beyond Banking) and act as comprehensive sustainability companions, thereby making a crucial contribution to promoting a sustainable, future-proof economy.


Eurochambres. (2023, September 26). Access to sustainable finance for SMEs: A European Survey. Eurochambres. Retrievable online.
PricewaterhouseCoopers. (2023, February). ESG-Strategie und -Reporting im Mittelstand. PwC. Retrievable online.
Otto, S. (2024, February 16). Die Schlüsselrolle von Banken im wirtschaftlichen Wandel. [Translation] Der Bank Blog. Retrievable online.

Sebastian Kaiser-Mühlecker
COO & Founding Member

About HalloSophia

The ConsulTech Company 'HalloSophia' offers and operates maintenance-free, digital all-in-one advisory marketplaces as a white-label solution. This innovative platform-as-a-service enables businesses, public institutions, and rapidly growing tech companies to centralize their expert networks on a dedicated portal. With 'HalloSophia,' organizations can now provide their clients and users with direct, efficient, and contemporary online access to the invaluable expertise of their internal and external specialists (from their network) in the form of individual 1:1 consulting sessions.