People care about where and how they spend their money. It is no longer simply a question of cost versus value. Now companies’ credentials when it comes to mitigating climate change or promoting social causes have become major considerations for consumers, particularly those from generations Y and Z.
This is being mirrored across the job market. Employers’ net-zero goals and commitments to diversity and inclusion are often high on prospective candidates’ wish lists. The latest Bupa Wellbeing Index found that nearly half (48%) of UK adults would accept a job on lower pay if it meant working for a more ethical or environmentally friendly organisation.
It stands to reason, then, that communicating a company’s environmental, social and governance (ESG) achievements and initiatives, both internally and externally, has become increasingly important. But companies need to do this in an authentic and transparent way if they’re to avoid accusations of social posturing or greenwashing.
Honesty is the best policy
This means businesses should beware of making claims they can’t substantiate, warns Richard Sharp, creative director of marketing firm The Sharp Agency. To avoid ESG coming across as gimmicky or contrived, he says, firms must always practise what they preach.
“To truly showcase environmental sustainability or diversity and inclusion without seeming forced, a company must live and breathe these values. It’s all about transparency and integrating these principles into the company culture,” Sharp notes.
Certainly, there is no point in a company saying it values diversity, for example, if it continues to only recruit from one particular demographic. Those claims will also ring hollow if the company’s senior leadership lacks diversity.
Sharp suggests companies document measurable goals they have achieved, whether through blogs, videos, or on social media, to “convey dedication to responsible business practices.”
The value of B Corp status
Having accreditations, such as B Corp or Fairtrade can be useful here to bring some rigour to claims. And these should be promoted, according to Sharp, by putting a B Corp logo on a company website or packaging.
But there is more work to do than simply adding a logo, brands need to personalise their strategies and explain what these programmes mean for their businesses and customers, for example by creating a dedicated web page to explain how B Corp shows up in their business.
“Use case studies and impact stories to illustrate your positive changes and regularly publish content highlighting your sustainability efforts. These steps don’t just reinforce your identity as a responsible and ethical business; they breathe life into your brand, connecting you with people who are equally passionate about making a positive impact,” he adds.
Adapting messaging for different audiences
For Marcus Knight, the co-founder and marketing director of PR firm Be Yellow, the key to an effective ESG communications strategy is an ability to explain “the what, the why and the how” of any particular initiatives in detail. It’s not enough for a company to simply say that it recycles, for example, without demonstrating that it understands the benefits of doing so.
Communication strategies around ESG, Knight says, can and should “change depending on who you’re trying to engage. It is likely that a business will need different strategies for both internal and external stakeholders.”
Internally, staff are likely to want to know why they are being asked to do something or how a particular policy might contribute to better company performance or productivity.
Externally, consumers are more likely to be moved by an ESG claim that gives them the impression their purchasing choice is actively making a positive difference to a cause. That is to say, if they choose to buy a certain product or use a certain service that is good for the environment or society, then the environment or society will benefit directly as a result.
“People invest their money, time and energy into companies they believe in, and when consumers, they are more inclined to do good, and engage further,” Knight says.
Focusing on the past and the present
Ultimately, ESG matters. Whether a company is perceived as an overall force for good or bad can be the difference between making or losing a sale, or attracting or putting off top talent.
Indeed, Kerttu Inkeroinen, the marketing director at non-alcoholic lager brewer Lucky Saint, notes that being a B Corp can give a company a competitive edge. “Most candidates ask about our B Corp status when applying for jobs,” she says.
But it is not enough for companies to simply peddle messages that they think people want to hear. Rather than pledges about what they will do soon, they must be able to provide proof of action already being taken – and succeeding. People like to know when an idea already works.
Within the B2B space, B Corp accreditation appears a good place to start. For Bahar Shahidi, a senior strategist at branding agency DesignStudio, being a B Corp is “recognisable shorthand for a business that cares about people and the planet, as well as profit.” While Shahidi acknowledges some “imperfections” in the B Corp assessment process and acknowledges some criticism of the process, she suggests that it remains, on balance, the best ESG barometer available.
As B Corp certification is reassessed every three years, she adds, companies that are able to maintain it are likely to enjoy a long-term reputational boost. “It’s not just a fluffy or aspirational statement of intent, but rather proof of commitment and an ongoing promise,” Shahidi explains. “That’s its strength; it says that as a business you’ve met certain criteria to be eligible for certification and you’re now accountable to that.”
Inclusive language can amplify an argument
When it comes to consumer interactions, companies should focus on authenticity and collaborative language; they should seek to evoke emotion, empower and inspire people.
Firms should be relatable and put the consumer into a perceived position of control: if you buy or use this, you can help this company make a positive impact on the world.
As Knight puts it: “People want to feel a connection with a company, and connect with something that aligns with their interests and values.”
