Sustainable ethics

Unilever’s recent sustainability drive is being questioned in marketing circles, and no doubt in shareholder circles too.

But there’s real insight in this move, if you care to look a little deeper:

• To start with, the drive is accredited to listening to consumers. Unilever is not alone in recognising consumer’s growing conscience and their willingness to engage with credible trustworthy brands, The Food and Drink Federation (FDF UK) for example has also created a new sustainable practice.

• And of further significance, is that sustainability will now sit within Unilever’s marketing remit, as opposed to perhaps being the adjunct to strategy that CSR too often is. After all 'sustainability' is a consumer message that market oriented businesses must embrace and embed in their marketing, beyond the CSR report

• There’s also evidence to suggest that shareholders are less sceptical about such initiatives now. Investec’s new sustainable message and especially its ”Money isn’t everything” line is testament to this

• And recession or not, global brands are still cognisant of the need to keep sustainability on the agenda (www.bsr.org) - as per my previous blog

• Finally, the apparent hypocrisy of brands encouraging a behavioural change to consume less, can be countered by a message to consume more wisely - which incidentally also resonates particularly well in times of economic restraint. The emphasis here should be more about need than want, and critically about building trust that generates gains in terms of loyalty and growing a customer base.

But what pleases me most about this announcement, is that it is yet another indication of a genuine move towards business conducting itself more ethically, and the clear evolution of what corporate citizenship should, and can, be.

“Purpose” a purchase trigger and CSR still a focus – according to latest research

Cause related marketing is dead, long live Responsible RoI…

OK this isn’t quite true, but two interesting pieces of research allude to this as a possible new state of marketing affairs (and are also testament to what I’ve been saying for some time now):

According to The Global Edelman Goodpurpose Study http://www.goodpurposecommunity.com/ just released, more than half of consumers have more trust in a brand that is ethically and socially responsible. And crucially, 57% believe brands need to integrate good causes into their day-to-day business, with 90% of consumers feeling that brands needed to do more than just give money to charities and should consider society's interests as much as the business'.

Juxtapose these findings with global consulting and research company BSR’s http://www.bsr.com/ - which found that business leaders are still focused on sustainability and increasingly on social issues, despite the recession – and my suggestion of new marketing order is justified.

I could of course bore you with countless academic studies that further endorse both sets of findings, but as I keep saying in these blogs, actions speak louder than words. So instead I suggest you acknowledge what is fast becoming good business practice in terms of engaging corporate citizenship, and examine how this might apply to your brand.

If the current economic climate has not dampened global business leaders’ consideration of sustainable and CSR-related issues, then there must be some similar resonance or at least reason, with all commercial enterprise, regardless of size. Because what both reports illustrate is that the consumer and the public view have shifted significantly over the last few years. This is more a consumer-driven shift than a recessionary one, with the facilitating catalyst being the internet.

The domino effect of new consumer attitudes and rising social issues, has led to new consumer behaviour and therefore an alternative marketing paradigm, that’s worth serious consideration. Because, to quote a UK businessman, “if you see a bandwagon, you’re too late”

The metrics of ethics

You know the adage: “If you can’t measure it, how do you know it works?” Well ethics is no exception. But the metrics are as diverse as the definitions.

CSR is one of the antecedents of economic performance (McGee 1998) and can be used to strengthen corporate image and “ultimately economic/financial performance” (with the reverse also holding true). But ethics goes further than CSR. Much further:

An organisation’s ethics should be enshrined in every aspect of its activity from product to customer to supplier to staff. They should be embedded in every business function (especially marketing) within the organisation, so that everyone involved is aware of your position from an ethical and values perspective.

By articulating and communicating your organisation’s ethics, it should be possible to review and to manage how they affect each area of the business.

For example, ethical companies tend to be more customer oriented, and therefore measuring consumer behaviour is one option. Evaluating marketing performance is another. And as companies with communicated ethics and values have greater staff commitment, then measuring staff performance and loyalty are other metrics to consider.

Then there’s Anmbler, Kokkinaki & Puntoni’s (2004) model that covers off three significant bases, all of which present tangible aspects of the business that can be measured:
• Relationships: with consumers, stakeholders, shareholders, employees and suppliers
• Economics: profit, sales, company/brand value, market share
• Social opportunities: cost benefit analysis and social RoI
The FTSE4Good Index also offers in its criteria a list of elements that can be measured with regard to ethical behaviour.

And the lists go on.

The key point in all of this is that ethics should not be viewed as intangible, a ‘nice but not need to have’, or a CSR tick box. Ethics are a real and measurable part of doing business today.

So if you are an advocate of making the effort to clarify, define and enshrine ethics in your organisation, then you need to also ensure you include some metrics. Only then can you truly realise the value of ethics. And equally as important, only then can you really bring the board and management with you.

Walking the ethical talk - step by step

Too often ethics are seen only in the context of the ubiquitous green policies, community programmes and CSR report. And while these are ethical issues, it is often the smaller actions of an organisation that speak ethical volumes.

Consider the measurements that ethical indexes such as the Swiss Covalence Ethical Quotation System and Ethisphere.com use to rate companies: consumer communication, dealing with complaints, distribution and marketing. Because it is the everyday implementation of these areas that show a brand to be walking the talk… or not…

 For example:
Is it ethical if an airline charges obligatory extras that the consumer is only made aware of when they’re half way through the purchasing process?

Is it ethical that a food label can carry unsubstantiated health claims, or nutritional information for “portion” sizes that do not equate to likely product consumption - the 200ml kids smoothie label that cites a 100ml portion and the King size chocolate bar or soft drink that cites a portion as being half the product.

Is it ethical for a restaurant or hotel to claim it is “family friendly” when the catering and the pricing is anything but?

Ethics can be widely and unconsciously disregarded in the smallest of ways. But the accumulative effect of these apparently minor misdemeanours can be far reaching.

Today’s consumers want to feel good about the choices they make. They may have roomier purses but they also have time to consider how they spend their reduced disposable income. And it is not so much the price but the value and values that that price and the product infer that concerns consumers.

So brands that want to engage with today’s consumers need to get their values in order and their ethics in line.

Collective Responsibility

Ask yourself: “What do you or your organisation do when a social issue like obesity or marketing to children, is raised?” The typical knee jerk reaction is to point the finger: At other brands; at industry; at parents; at schools; at politicians; at anyone other than yourself.

If ethics is about exercising good judgement for the greater good, then it follows that if we all act responsibly then this collective responsibility will generate behaviour and actions that address issues such as these.

If there is something – however small – that an organisation, brand or individual can do, then it is our civic duty to do so. Passing the buck is not acceptable. And ignorance, in this multi media age, is not excusable.

Being responsible is more than a CSR page in the annual report. And more than donating to charity. It is about questioning your morals and values, and embedding them in your actions. For a business, that also means immersing your supply chain in these values. And codifying these so that your staff actually know what is deemed ethically appropriate for the business.

For an individual, it’s about retaining your own inherent morals and ethics, even and especially at work. Because individual decisions can be employer-focused and still ethically sound. And where they’re not, the organisation must address this.

Whatever way you look at it, acting responsibly is ultimately about doing good. And in times of recession and consumer disillusionment, doing good, is now good for business too.

So the bottom line is… the bottom line. Because no man is an island. Even in Ireland.