As a company that’s been lucky enough to work in many sectors traditionally identified as ‘sustainability challenged’ - agribusiness; airlines; civil engineering; energy; plastics - we’ve seen the topic grow exponentially as a corporate agenda item. From its ‘nice to have’ provenance, focused on the environmental, or NGO lobby; to a ‘must have’ core positioning element, demanding cross-stakeholder attention.
Few senior executives - particularly in the current climate (pun intended) - would deny its importance, not just in terms of corporate reputation, where it has always figured prominently, but also in the now proven contribution it can make to financial returns. In the article “Five ways that ESG creates value” (Witold Henisz; Tim Koller; Robin Nuttall), McKinsey has identified:
Top-line growth: by attracting B2B and B2C customers with more sustainable products and services, and achieving better access to resources - financial, or otherwise - via stronger community and government relations.
Cost reductions: from lower energy consumption and reduced water intake.
Less regulatory and legal interventions: delivering greater strategic freedom through deregulation, supported by the ability to earn subsidies and government support.
Productivity uplift: through greater employee motivation and retentio, as well as enhanced corporate appeal from greater social credibility.
Investment and asset optimisation: enhanced returns based on better allocating capital for the longer-term (e.g. more sustainable plant and machinery, while avoiding investments that may not pay off due to longer-term environmental issues.
So far, so very justifiable.
With a strong business and reputational case, businesses have responded in many ways: from the ‘big concept’ programmes designed to address one, or more of the world’s leading social, environmental, or economic issues - alleviating poverty; tackling climate change; reducing pollutants; or feeding an ever-growing global population - to more targeted, industry-specific initiatives. Take agribusiness, for example, where much of
that sector’s efforts are, perhaps not surprisingly, focused on the environment and, in particular, waste management and the circular economy.
Given that companies are positioning their approach to Sustainability in such different ways, it’s tempting to ask if that term - with its historic and close associations with the environment - is still the correct one to use.
Not as far as McKinsey is concerned, who talk about ESG (Environmental; Social and Governance) in their article; whereas other businesses will often refer to EES (Environment; Economic and Social Sustainability).
Yet if you’re the UN, you might well argue differently, given their blueprint for
“17 Sustainability Development Goals” clearly states that everything does, indeed, have a sustainable connection, role and impact.
So, is Sustainability a part of ESG, or EES? Or the other way round? (Does it even matter?)
There’s no right, or wrong answer, although arguably the bigger a company’s ambition, the broader the reference point should be. However, what this debate does reveal is how important it is for businesses to clearly communicate their Sustainability / ESG / EES positioning: Why do it? Where is it focused? What’s the scope? What will it deliver? How does it support the corporate strategy? How does it support the corporate brand?
Which neatly segues into the Sustainability vis-à-vis Corporate Purpose debate.
Much has been written about how companies are now expected to engage with a wider cross-section of stakeholders, beyond just shareholders. Also how they must be able to answer the question ‘Why do we exist’, as well as demonstrate how “their values, beliefs and actions have had a meaningful, measurable and positive impact on the world in which they operate”. (Mars Inc’s definition of Purpose.)
With its positive ‘force for change’, Sustainability can clearly play a significant role alongside Purpose, but only if the two are aligned, with ‘joined-up thinking’ between the internal teams tasked with championing each. And that’s never easy, given the large number of corporate-driven programmes at any one time, and consequent pressures placed on delivering integrated communications. (Let alone, brand management).
At first sight, this can appear fairly straightforward: the overall Sustainability topic has a naturally positive ‘spin’; the narrative will usually follow a logical, facts-based story-line; the conclusions will be strongly results-focused.
As such, it’s tempting to view communications as playing a secondary role to the “actions speak louder than words” mantra. Yet this is surely to underplay its importance not only in giving the Sustainability agenda a powerful focal point (i.e. what is the ‘Big Idea’?), but also freeing it from the dangers of merely being a strategising, fact-checking, or reporting exercise. In doing so, it can turn it into something far more inspiring...
...but only if a delicate balance can be struck in terms of identity, content and tone.
The first challenge is to reflect the optimum relationship between the programme identity - in the broadest sense of that term - and that of the parent brand and sponsor. How to give it sufficient ‘voice’ to ensure stand-out against the ‘noise’ of other initiatives, while also supporting the overall corporate positioning: Vision, Mission, Values and Purpose?
Cue the ‘stand-alone’ vs. ‘endorsed’ vs. ‘monolithic’ branding debate, including whether or not the programme should have its own logo? Or ‘look & feel’? Or proprietary language? If not, then how closely aligned should it be to the main parent entity?
Clearly, the ideal is to ensure that each supports the other, with a strong link between the two, while also having sufficient independence to target their respective audiences.
But, in corporate life, often the obvious solution is the most difficult to agree.
‘Balance’ becomes even more problematic when the Sustainability challenge is felt to be bigger than any single company can address. One of our clients has concluded that the best way to tackle the global issues facing their sector is to form a pre-competitive, cross- industry partnership - working on the premise that ‘many heads are better than one’.
But how do you position such an initiative, while giving sufficient prominence to each of the contributing partners? How manage that debate? (Watch this space!)
Sustainability is about making an impact; and even though the context often involves highly emotive issues - climate change; worker exploitation; malnourishment - the primary focus will always be on the pragmatic, at delivering practical results.
Much of the messaging, therefore, will be technical in nature - the science of waste management, for example - although never underestimate the importance of emotion. Despite the inherent ‘positivity’ of the subject matter, well-crafted content, with a strong idea that’s presented in an original and inspiring way, is still the key to being noticed and appreciated. As one Corporate Affairs director put it: ‘Our sustainability agenda is just as good - if not better - than our biggest and nearest competitor; but they just seem to be able to get their message across more effectively and in a more engaging way’.
The challenge is to engage with stakeholders both at the rational level (relatively easy) and emotional (more difficult). This is particularly demanding for B2B companies who
deal with B2C clients. Given the latter have a greater affinity with the idea of appealing
to both ‘minds and hearts’ - broadly speaking from their exposure to brands’ marketing - they are increasingly expecting B2B to speak their language. Take, for example, the UK retail sector where traditional commodity producers of fresh meat, fruit and vegetables are now required to engage more directly with consumers due to the supermarkets’ need for greater transparency across the supply chain.
Allied to the rational vs. emotional debate is that of how to establish the correct, or most appropriate tone. And while the challenge is simple, the solution is frequently less so.
Self-evidently, Sustainability is a serious subject dealing with serious issues. It doesn’t lend itself to ‘marketing speak’, and / or hyperbole. Yet if the narrative is too understated, or overly strategic / technically ‘dry’, or even - dare one say it? - ‘worthy’, will it ever do justice to the matters at hand, or encourage people to engage more fully?
Tone is also more than just ‘of-voice’. It resonates at every stage of the communications’ process and every point of contact: from the creation of the over-arching campaign theme; to the narrative and visual language; the supporting imagery and personality; the stories told and where they’re told. It must be sensitively shaped and nurtured throughout.
Yet, sadly, even if a company gets all the above (checks and) balances right, there’s still no absolute guarantee of success...
...because Sustainability demands change... and engagement is not synonymous with that term. (Despite many companies believing that things will happen simply by ‘getting the message out there’.)
‘Communication’ can only do so much. To be truly effective, it needs commitment from the team at the very top: their input in creating the strategy; their support for the ideas generated; and their influence in being seen to ‘walk the talk’ and drive the agenda.
Regardless of all the finely-honed words and images, only they - both personally and individually - can truly show where Sustainability fits in relation to the core business; whether there’s a genuine commitment to and emotional bond with the strategies and policies in play; and if the tone has, indeed, been correctly and consistently set.
In that regard, perhaps this is one argument for having an unbalanced Board!
‘Engagement’ is not synonymous with ‘change’