Sustainability has become dramatically more important for businesses in recent years following greatly increased public discussion and awareness of environmental concerns, as well as an increasing number and scale of environmental issues targeted by governments and campaign groups. Sustainability is now a mainstream commercial concern, and one that can have a big impact on customer perceptions and brand loyalty.
Ethical and sustainability issues remain a key driver for almost a third of consumers, according to new research from Deloitte, with shoppers claiming to have stopped purchasing from some brands due to concerns over environment practices. Additionally, amongst those UK consumers who have chosen brands that have environmentally sustainable practices in the last 12 months, 43% say they value brands that produce sustainable packaging and adopt circular practices to minimise their environmental impact
Scrutiny on sustainable business practices has extended into every area, including a new focus on marketing and brand activity.
The increase in public awareness of environmental issues has also led to increased scrutiny of greenwashing in advertising, in which companies invest in ads that mislead the public about their eco-credentials. In 2021, the Advertising Standards Authority announced that it will be launching inquiries to analyse environmental claims made by companies in sectors like energy, waste and transport, and that it will commission research into the carbon neutral and net zero promises made in ads.
Tools are becoming available that enable organisations to calculate the carbon footprint of their ad activity, such as a carbon calculator released by Good-Loop in June 2021, and one created by the AdGreen initiative from the Advertising Association, in September 2021. While these types of measures are still far from commonplace, businesses with a strong digital component are gaining more sustainability options with meaningful measurement and results.
Brands are responding to the consumer demand for sustainability through recommerce, or online resale of used (but still functional) goods – a surprising avenue of growth for many clothing companies looking to expand their environmental credentials. According to Cowen, recommerce is expected to account for 14% of the apparel, footwear, and accessories market by 2024 ‘ a remarkable increase from only 7% in 2020. The pandemic has seemingly accelerated the shift to secondhand, with many buying less new clothing during lockdowns – with 42% of all consumers and 53% of millennials and Gen Z saying they’ll spend more on secondhand in the next five years.
Many of today’s leading companies in sustainability, like Nike, Coca-Cola, Telenor, IKEA, Siemens and Nestle have stepped up largely as a consequence of a crisis and public backlash against unsustainable practices; Nike faced boycotts and public anger for abusive labour practices throughout the 90s, but turned the tide around. In 2005, it became a pioneer in establishing transparency by publishing a complete list of the factories it contracts with and a detailed 108-page report revealing conditions and pay in its factories. It also acknowledged widespread issues, particularly in its south Asian factories. By recognizing the impact of sustainability in a crisis these companies have all developed more proactive sustainability strategies.