Consumers and businesses are increasingly taking a more critical view of the organizations that they associate with, regarding them as more than just financial entities.
A growing number of consumers take into consideration the social and environmental reputation of companies when deciding which products to buy. These consumers think about how their purchases affect non-financial outcomes such as the environment, human capital, quality of life, and the welfare of future generations.
A reputation that demonstrates concern about these issues sets a company apart from its competitors. Consider the popularity of fair trade coffee and organically grown produce, whose distributors promise to promote the welfare of the providers and the environment. By aligning your organization with values of sustainability, your brand can build trust and loyalty of the rising number of "green" consumers.
A recent study done by Opinion Research Corporation shows that:
- 61% of Americans say they are more likely to buy an environmentally- friendly product, even if it costs more than another product.
- 95% say they would be more likely to buy a product with environmental attributes when the price remains the same.
Other tangible benefits of having a brand associated with positive environmental and social values include:
Employees want to work for companies that they are proud of. By aligning your company with sustainability you will have higher retention rates and lower recruitment costs. Lower employee turnover means savings on training new staff.
Less legal and insurance risk
Having the loyalty of the communities in which you operate makes you less vulnerable to frivolous lawsuits and negative media. This has been recognized by insurance companies and has resulted in lower insurance costs for companies that are managed to sustainability standards. To see examples from Fireman's Fund Insurance Company, click here.