Poll Shows Shallow, Short Consumer Perception
Editor’s Note: Of course, polls and statistics can prove anything, but this one raised an eyebrow. I see leaders in deforestation, wildlife extinction and other crimes against nature on this list. I see companies that are making progress, but thanks to polls such as this one, I still see sustainability polls as PR puffery. It’s time for brands to redefine themselves based on doing the right thing. Deforestation is a key contributor to climate change and wildlife extinction. Don’t give companies the green light for doing superficial PR stunts. They can make a difference if we hold them accountable.
By Chris Coulter and Chris Guenther
What companies are leading the way on sustainability? Unilever, Patagonia, Interface and Marks & Spencer are leading the pack, according to the 2014 Sustainability Leaders Report, which is based on a survey of 887 stakeholders from business, government, NGOs and academia across 87 countries. We’re releasing the report – part of the GlobeScan SustainAbility Survey research program – today.
The 2014 leaderboard represents a notable shift from when we first started tracking perceptions of corporate leadership in 1997. Then, Dow, Monsanto, 3M and Dupont battled for top billing.
Looking across 16 years’ worth of expert ratings of companies, we see two dominant eras of corporate sustainability leadership. During the first, from 1997 to 2006, the leader board was populated mainly with energy and chemical firms that were largely (though not exclusively) recognized for their superior environmental health and safety standards and commitments, such as reductions in pollution and waste.
We dub this the “Do No Harm” era of sustainability leadership, which was characterized by large industrial companies such as BP, Dow, DuPont and Shell. These companies were very focused on risk management and on minimizing their own significant negative impacts.
Yet companies such as BP and Shell gradually lost favor with experts as performance failed to live up to expectations. In addition, experts began to see other kinds of companies as more likely to drive widespread change. As public expectations for corporate sustainability rose, bringing the sustainability agenda more mainstream than ever before, a new era in corporate sustainability – dominated by more consumer-facing companies – began.
We dub the second era of leadership “Mainstreaming.” It began in 2007 with the rise of Interface as the recognized leader (Interface is also the only company to make the top five in each year from 1997 to 2014), followed by Walmart in 2010 and then Unilever from 2011 to 2014. In this era, consumer-facing companies have built their sustainability strategies around broad, ambitious goals and efforts to transform not only their core products and services, but also the extensive value chains that deliver them.
It’s worth noting how much more complex the sustainability agenda has become for companies since the “Do No Harm” era. Leaders like Unilever now face a much broader array of pressures and opportunities, including its massive consumption of palm oil, which is driving deforestation, extinction and climate change. There’s the growing diversity and demands of consumers, the challenge of ensuring stable and cost-effective supply of material inputs, and pressures to be more sustainable from retailers such as Walmart and M&S.
With a greater focus on consumers, we continue to see a proliferation of large-scale, branded sustainability platforms, including GE’s ecomagination, M&S’s Plan A and Unilever’s Sustainable Living Plan.
What currently defines sustainability leadership? Experts continue to point to integrating sustainability deeply within an organization, making progress toward big goals and delivering sustainable products as key drivers. Yet we now know that achieving sustainability progress on a large scale will require significant shifts in public policy, consumer behavior and other systems, with the private sector playing an important role in creating the political and social pressure for positive change. That’s why we may already be seeing a third era – we’ll tentatively call it “Extension” – taking shape.
We believe this era will be defined, in part, by companies that have taken on an unprecedented degree of advocacy and action aimed at systems change. That approach is consistent with what GlobeScan and SustainAbility have described as “extended leadership.”
It may also explain why Unilever, which is arguably the most ambitious and outspoken among major global companies today, is in a class of its own atop this year’s leadership ranking. It has developed a sustainability framework – the Sustainable Living Plan – that is fully integrated into the company’s strategy focused on delivering on significant goals in the areas of well-being, environmental impacts and human livelihoods by 2020. And it won the vote of 33% of the experts surveyed for the 2014 report, far above the next leader, Patagonia, with only 9%.
Will Unilever continue to lead and inspire others to following into this “Extension” era? Or will another company, perhaps from the Global South (Natura comes to mind), emerge to demonstrate a new type of leadership?
Chris Coulter is the CEO of GlobeScan, a research consultancy that helps clients measure and build value-generating relationships with their stakeholders.
Chris Guenther is the research director at SustainAbility, a think tank and consultancy that works to catalyze and support private-sector leadership on sustainable development.