Global Corporate Responsibility: Changing Lightbulbs Versus Changing Lifestyles

Corporate Responsibility (CR) issues are picking up steam, with expectations of businesses becoming increasingly public, especially those in the environmental sector. Consumers feel confused about the issues and the role they as individuals can play. They are looking to business to help them. Those were major themes at an in-depth conference called "The Responsible Retailing Summit," sponsored by The Retail Bulletin and held in London on January 30-31. The conference provided rich detail about changing consumer attitudes, and about how businesses should structure, carry out and communicate CR efforts. It also identified some trends expected during the next few years. Smart companies should plan now to address these trends. It also spotlighted similarities and differences in the way corporate responsibility issues are evolving in the UK and U.S. Consumers The environment has now surpassed employees as the number one issue UK consumers want companies to focus on, mirroring research done by us at Cone LLC that shows growing interest by American consumers in environmental issues. Jenny Dawkins, head of CR research at Ipsos MORI, reports that recycling and packaging are the two environmental areas UK consumers most want to hear about from company communications. By comparison, people are having trouble understanding climate change issues and see those as a lesser priority in company communications, although experts and activists feel differently. There was another finding of importance to CR and communications professionals: Research shows high cynicism by consumers regarding environmental messages from companies. Ms. Dawkins reported that 79% of UK consumers agree that "a lot of companies nowadays pretend to be ethical just to sell more products," and an equally high percentage agree that they "don't think it's enough for companies to say that they are ethical, they need to prove it to me." This mirrors the increasing chorus of greenwashing accusations seen here in the U.S., including entire Web sites devoted to a watchdog role over marketing communications concerning the environment. In addition, CR professionals in the UK are reporting the same confusion and uncertainty among consumers that we are seeing here in the U.S. with regard to their own environmental role. Rowland Hill, sustainability manager for the department store chain Marks & Spencer, put it this way: "People will change their light bulbs but they won't change their lifestyles." So, the challenge for business communicators is to engage and connect consumers to environmental issues, using the power of marketing to educate and motivate. Resist the urge to hype and exaggerate, and instead ground communications to the company's actual environmental practices and impact. The Role of Business The reality is that consumers are expecting business to take the lead on environmental issues. Here, conference presentations showed that leading UK companies deserve the reputation they have long held as corporate responsibility innovators. Rowland Hill outlined Marks & Spencer's five-year major financial investment in "Plan A," which sets goals of carbon-neutral operations, zero landfill use, employing sustainable raw materials, ethical trading and providing healthy foods. Another hot topic in the UK consumer sector is the concept of "choice editing" by retailers and manufacturers. In essence, a company stops selling products that are environmentally objectionable and can't be improved, effectively "making the choice" on behalf of consumers. A prime example of this is patio heaters--those gas or propane devices used on restaurant or home patios in chilly climates such as the UK. Retailers began to "edit out" the product after a study showed that while someone sat under a patio heater drinking a cup of tea, the heater used the energy needed to make a hundred cups of tea. A sign of how much more aggressive CR efforts are in the UK compared to the U.S. is the involvement of government in supporting business. At the conference, there were several presentations by a government-funded group called Envirowise, which has more than 100 advisors on carbon emissions, packaging, and materials who can provide free and confidential advice to UK companies on reducing their environmental impact. The Role of Regulation: Two Different CR Worlds For an American like me, the most thought-provoking part of the conference came when "the lawyer" spoke. Elizabeth Shepherd, partner at Eversheds LLP, described a regulatory environment in the UK that would likely cause a storm of protest in the U.S. (if anyone had the courage to propose it). Take Back Your Used Packaging: New government rules in the UK hold manufacturers (and retailers who make their own products) responsible to recover and recycle their packaging or face criminal penalties and media skewering. Take Back Your Used Products: Another regulation going into effect in the UK (but born in the European Union) requires businesses that make or sell electrical appliances, computers, etc. pay for safe disposal of that equipment. Measure and Disclose the Energy Efficiency of Rental Property: This energy use regulation is again an EU creation, and is taking effect in the UK this year. It requires owners of buildings that rent office space or apartments to measure energy use, and then report it to a public database. This will allow renters to comparison shop for energy efficient places to live and work. So how much of the UK's CR leadership is driven by regulation, and how much by business innovation? It's an important question since it is highly unlikely the U.S. government will impose similarly aggressive rules anytime soon. When I asked this at the London conference, no one seemed sure. My sense is that while the UK is a leader in the "ideology" of CR and has more than its share of companies trying to practice it, the UK faces the same challenges as the U.S. in making environmental sustainability a mainstream practice. So in the absence of the kind of legislation described above, it's going to be up to enlightened business executives and communicators in the U.S. to see the social, environmental, and profit potential in corporate responsibility practices. For those who wish to lead, speakers at the conference had some advice. Don't just anoint a head of CR or sustainability, or even a department of such people, and assume everything will be fine. Companies such as Marks & Spencer have learned that embedding CR practices into day-to-day operations means driving accountability down to the people who run stores, choose raw materials, and deal with customers. This can be as simple as making a store's annual energy usage and trash a factor in a manager's review and bonus (as Boots does) or as complicated as having 560 "champions" of individual CR commitments and goals, (as Marks & Spencer does). And all parties agree that CEO commitment and ongoing support is critical. PRN CONTACT: This article was written by Cone LLC EVP Mike Lawrence, who leads the CR team. He can be reached at ? Future Trends: The Next 3-5 Years 1. Emphasis on sustainability, not just carbon emissions 2. More confident brands that make it easy for consumers to "do the right thing" 3. A limit on the value of environmental labels (consumers make retail decisions in 4 seconds) 4. More "Choice Editing" by businesses for consumers (but not in food, which will be too controversial) 5. The rise of a "global green consumer" who asks where things come from and what their impact is (Adapted from Dr. Sally Uren, Forum for the Future, as presented at "Responsible Retailing" conference)

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