By Marisa Greenwald (Green Marketing & Sustainability Practice, Grossman Marketing Group)
Despite widespread support for sustainability reforms, lofty rhetoric from CEOs and government incentivizes for businesses to “go green,” corporate sustainability improvements have been limited. To further probe why companies are not moving more aggressively on this front, Deloitte recently published a study that delineates corporate perspectives on sustainability based on responses from 48 companies across different industries. The report studies these perspectives in five contexts: general sustainable practices, sustainability related to innovation, corporate responses to sustainability incentives in the stimulus package, the relevance of new skills in pursuing sustainability efforts, and future sustainability trends. Several compelling trends emerged from this study which I thought would be worth sharing with the Sustainable Ink community.
First, it is interesting to note the challenge companies face trying to innovate through sustainability. The study found that in the area of product innovation, 23% of companies surveyed were developing entire sustainable product lines while only 25% of all companies surveyed indicated they were pursuing efforts to make their products more sustainable. So while a considerable portion of companies are devoting entire lines to greening efforts, only a fourth of all surveyed incorporate the sustainability factor into innovation. A major problem companies identify when trying to create sustainable products is the tension between willingness to pay and cost. Even though customers may want sustainable products, they are not necessarily willing to pay more for them, so companies must find ways of keeping the sustainable measures cost-neutral.
Another interesting finding from this report is the corporate reaction to sustainability incentives in the stimulus package enacted last year. While there was an overall mild recognition of energy efficiency incentives in the legislation (5.29 on 10-point scale, with 1 being not at all familiar and 10 being very familiar), there was the largest gap in understanding between the automotive industry, 6.38, and the technology industry, 3.91. The gap in policy awareness between the industries supports the broader idea that there is a heightened emphasis on greening in the automotive industry, where carmakers have been under considerable scrutiny and consumers have a relatively high willingness to pay for a hybrid vehicle, compared to a willingness to buy energy efficient technology products.
Overall, this report offers strong insights into corporate perspectives and decision making criteria in the context of proposed sustainability reforms. Sustainability advocates and policymakers must continue to consider the needs of corporations who are open to pursuing stronger sustainability standards but whose aims continue to be maximizing shareholder value and maintaining profitability.
Click here to download the full report from Deloitte.