By: Leeya Hendricks
Currently, organisations are not just focused on creating value in products and services, but are also reinventing the way they work. For businesses, enabling growth and development through moments of impact will be critical for expansion.
Environmental, social and governance (ESG) based initiatives are topping businesses’ ‘to-implement’ list this decade. While ESG criteria have been around since the 1960s, high impact and successful results from early adopters across industries spur more firms to revolutionise their value chain through sustainability.
Traditionally, brands have engaged in sustainability as a tick box exercise, but not a core enabler of impact. This has been detrimental to brands overall, as consumers and business partners lose trust in ‘greenwashed’ businesses and demand for authentic and sustainable business leaders.
Not only will sustainability be a top priority for marketers in the next five years, but many companies already started adopting this as part of their core marketing efforts.
In financial services, successful ESG messaging hinges on building trust through disclosing your sustainability efforts. Not only is this better for customer engagement and improved customer experiences, but it can drive revenue.
ESG is driving, not draining, growth
Incorporating ESG principles into your business model is now essential to survive and thrive as an organisation. The public mindset has shifted into thinking long-term about what kind of impact businesses have on the community and environment.
For a moment, let us look at one specific industry – financial services. 76% of banks believe there will be a continued increase in client demand for ESG investment options until the end of 2021. And this trend is mirrored across industries and business sizes. Sustainability is the future. Positioning your business as ESG-friendly is vital to retain consumer trust.
It is no longer enough to say that you favour environmental protections as a business. Consumers and potential business partners are wary of ‘greenwashing’ – or setting superficial sustainability initiatives. For companies, disclosing specific and detailed ESG efforts as part of their marketing strategy can quickly grow brand trust.
Of course, the road to designing and implementing as a part of marketing has not been easy. As we mentioned earlier, being superficial, or putting in the minimum possible effort to appear ESG-friendly, often results in a negative brand image. However, we have found that sincerely incorporating sustainability efforts as a part of your core business lends itself naturally to marketing and lays the foundations for an increase in profits and sales.
Sustainability drives this increase in revenue and productivity because it is a community-building exercise. When your marketing team can connect your vision, mission and practices with ESG goals and objectives, they can better describe your brand to the end-consumer. In other words, when you focus on your core consumers and their needs, you can discover and implement ESG practices that can benefit your bottom-line. And, as your clients see this focus, they want to support you and your business further.
That said, it is essential to remember you do not need to cover every aspect of ESG. Instead, hone in on critical areas relevant to your business and audience, and then amplify your message.
Sustainability is a win-win at all levels of business – from the floor, to marketing and beyond. Even with metrics that need to be better defined and standardised, firms of all sizes have seen long-term positive impacts from incorporating ESG principles into their value chain.
Implementing ESG measures for long-term returns
Businesses should be focused on building and maintaining consumer trust. It is essential to be authentic and ensure that sustainability is aligned with doing business for good, not just focused solely on profitability. For example, you will want to consider long-term investor outcomes as well as short-term gains.
Outlining your ESG efforts will assist with the market focus of a shared economy as you enable a global vision of growth for all. The new year’s key areas to focus on will be keeping a finger on the pulse to understand real-time behavioural and societal shifts, navigate them, innovate as a matter of necessity, and be flexible.
Some points to consider when drafting your marketing strategy are as follows:
- To gain consumer trust, always disclose your ESG efforts simply, consistently, and use specific information.
- Communicate your sustainability goals clearly and without jargon. Use clear, concise content.
- Ensure that your ESG-based initiatives and marketing content is aligned with doing business for good not just focused solely on profitability. Consumers can tell the difference.
- Focus on creating a more robust digital customer experience that will create a competitive advantage for your future growth.
Simple ways to start are through evaluating areas where you can reduce materials or optimise utilities. You can implement ‘know your customer/supplier’ (KYC/KYS) and other verification and authentication steps to ensure that your partners are ESG-friendly, and your customer data is secure.
You can also begin to incorporate ESG best practices into your risk management objectives by using common frameworks as a lens to review your marketing decisions. Then you can use your findings to communicate with different departments to consider ESG-friendly product enhancements.
Furthermore, shifting to a digital and automated marketing channel can offer more ways to obtain consumer feedback and cut down on waste from manual strategies and processes.
Overall, it is essential to keep in mind that investing in sustainability is the equivalent of focusing on value – something all firms should be doing anyway.
Staying ahead of the curve
Doing good creates value, which in turn generates profit and better brand visibility. Going into the new year, sustainable marketing can help drive profit with purpose and enable a shared economy for all.
As the market remains volatile, we need to keep our eye on both short-term and long-term goals. The pandemic has placed a lot of focus on the present. Still, we need to understand that the eventual reality is that building a sustainable business model will become the default.
In other words, to find growth, all organisations will end up leaning towards sustainable practices and marketing. The question is, when will you implement your sustainability strategy?