Seven in every ten small and medium sized firms are now conserving water, a 5% increase on two years ago.
The latest bi-annual Uisce Éireann SME Sustainability Sentiment Survey also found there was a 10% drop since 2022 in the number of businesses who say water conservation is "not on their radar".
Nine in every ten of the businesses who responded said they will maintain or increase their investments in sustainable practices.
However, rising costs remain a barrier for many of them with 70% of SMEs saying it was the primary obstacle.
The proportion of businesses citing a lack of information or Government supports has fallen considerably from 57% in 2023 to 43% in the second quarter of this year.
"Despite ongoing challenges related to cost, SMEs are steadfast in their commitment to maintaining and improving sustainability measures," said Uisce Éireann’s Head of Customer Operations, Geoffrey Bourke.
"Uisce Éireann recognises the considerable effort businesses have made in improving their water conservation activities throughout the past 18 months and we want to support SMEs as the green transition accelerates."
The owners of more than 350 small firms were surveyed by IPSOS Behaviour and Attitudes as part of the research.
Seven in 10 small and medium firms said cost savings are the primary driver for their decision making on sustainable investment.
But employees, customers and clients have shown an increasing desire for businesses to remain active in their sustainability efforts, the research shows.
45% said customer appetite is an influential driver of decision-making on sustainable investments.
That is up from 31% in the second quarter of 2022.
While one in four SMEs said employee interest was a driver in their decision making, the highest level since the survey commenced.
"Ireland’s small businesses are taking the issue of water conservation more seriously," said David Broderick, director of the Small Firms Association.
"The 5% increase in SME’s stating they are implementing water preservation is testament to the sector’s commitment to innovation and environmental sustainability."
Nine in 10 businesses said they still intend to maintain or increase their investment in sustainable practices in the coming year.
But overall the survey found there has been a slowdown in the number of businesses planning sustainability investments, from 20% in 2023 to 15% in the second quarter of 2024.
The number of businesses who increased their investment in the past 12 months, was down from 20% in 2023 to 11% this year.
