Sustainability and brand success go hand in hand

Asia’s most popular consumer electronics firms, Japanese car makers, FMCG giants and top local market brands are among those consumers voted to have the best records on sustainability in our Asia’s Top 1000 Brands survey.

This is the first year Campaign has asked the question of consumers, who have identified brands like Samsung, Apple, LG and Panasonic—consumer electronics titans that have been a mainstay of our survey’s top 10 for years—also as top 10 sustainable brands.

Consumers have also deemed Samsung, our perennial number one brand overall, the most sustainable. Huawei, the top Chinese brand among Chinese respondents, was also China’s lead pick for sustainability.

THE QUESTION: What brand has the best record on sustainability? (By sustainability we mean brands that are environmentally-friendly and operate in a socially conscious way in their communities).

Coincidence? Unlikely. So are respondents giving us lazy answers? Perhaps, but not really. Time to explain.

Firstly, all these brands are actually doing more on the sustainability front than before. Few consumers will read the corporate sustainability reports of their favourite brands, but if they did they would see that Samsung’s total renewable energy usage has risen 14-fold in the last three years to form 92% of its needs in the US, China and Europe last year—on track to hit 100% by the end of this year. Apple claims to have already hit that mark in 2018, when it’s overall carbon footprint was reduced by 35% from 2015 and its products used 70% less energy than a decade ago. LG has set up goals including a 95% waste recycling rate, a 50% cut in carbon emissions and using 100% responsible mining products.

Secondly, sustainability has become a much bigger factor in these companies’ outbound communications. Huawei’s main corporate social-media feeds probably have more do to with sustainability, education and diversity and CSR campaigns like ‘Tech4aBetterPlanet’ than technological features and financial updates.

Learn how #CloudAI & collaboration are key to protecting the Palawan rainforest ecosystem in the Philippines: https://t.co/Rjdde8NXYw #TECH4ALL

— Huawei (@Huawei) July 6, 2020

In part, this is because if brands can convince consumers they’re sustainable, then their job at selling technology, transparency and financial strength becomes easier as well, argues Prashant Kumar, founder and senior partner of digital agency Entropia in Malaysia.

“Another way to look at it is that sustainability is not just about specific causes. If customers see a company as sustainable, they see the company as responsible, and hence it creates a sense of trust,” he says. More sustainable companies are often credited with using ingenuity and novel manufacturing or supply processes, he says. “It is seen as innovative. It is also seen as more futuristic. These are very priceless brand attributes.”

Not surprisingly, then, we see leading Japanese car brands known for their quality and innovation, also placed in the top 10 most sustainable, far outpacing their overall brand scores. Toyota, ranked Asia’s 66th top brand overall, finished fifth in the sustainability category, while Honda placed not far behind in eighth. While Japanese consumers ranked Toyota as their top sustainable brand, both automakers received broad support in the category from markets right across Asia where their reputation has long been built.

This is not to say that specific projects don't count and innovative companies will get a free pass on sustainability. Specific initiatives do matter and the public can see how much effort and creativity is put into them.

No waste of an opportunity

DBS Bank is a case in point. As part of its history as the Development Bank of Singapore, it has long supported social entrepreneurism. The bank’s unique marketing and communications experiments saw it create a now widely known financial drama in the city state, called Sparks, for which its second season was based on the travails of social entrepreneurs it has supported.

Episodes have tackled issues from reducing plastics to providing equal opportunities for women, to this week’s special episode shot through videoconferencing about reducing food waste. On the Sparks website, supplementary videos like the one below, along with stories and tips explain the issues more directly, while a separate livestream event involving local celebrities delves more deeply into scrapping food waste with fun contests and recipes. It’s incredibly comprehensive coverage of social issues resembling that of a public broadcaster more than a bank—the very antithesis of corporate lip service. And the bank runs other sustainability-related projects alongside it.

While DBS ranks 512th overall among Asia’s Top 1000 brands, it places 38th in sustainability and is Asia’s top ranked financial institution in the category.

“There is a heavy expectation from society for corporates to do their part in mitigating [sustainability] challenges, says Karen Ngui, DBS’ head of group strategic marketing and communications. "Added on is the growing number of socially conscious investors who see environmental, social, and governance issues as criteria for investing."

“We are acutely aware that we are no longer judged strictly on our financial performance but also on what we do for employees, customers and our contributions to the communities we operate in. If we want to survive the long term, our actions need to be guided by a strong sense of purpose,” she adds.

But beyond reacting to stakeholders, the bank with its ‘Live More Bank Less’ tagline wants to be proactive, encouraging them “to live larger than themselves—to be socially conscious and lead more sustainable lives,” Ngui says.

Other brands building sustainability cred

Here one might mistake DBS for being an advocacy brand like Patagonia or Ben & Jerry’s, which tend to loom larger in the West. But here, in Asia, only The Body Shop (11), known for its ardent ecological stance, ranked in the Top 20. While Unilever (13) has increasingly become more active and outspoken on everything from gender diversity to climate change, it was one among many FMCGs and was bested significantly by its competitor Nestle (2).

Rather than identify multinational activist brands, many consumers across APAC markets chose a strong local brand as their most sustainable. Vietnam’s Vinamilk, India’s Tata, Indonesia’s Indofoods, none of which rank as a Top 500 brand in Asia, ranked 9th, 10th and 12th, respectively, in sustainability by virtue of being the clear choice in their home markets, as did NTUC FairPrice in Singapore, ranked 14th.

Interestingly, Malaysians chose energy company Petronas as their brand with the best sustainable record, making it the only oil and gas firm to earn a spot in the Top 20. Entropia’s Kumar, based in Kuala Lumpur, attributes this to a larger social role that Petronas plays in the community, investing millions into building community schools and colleges, and providing scholarships through its Yayasan Petronas CSR arm focused on education and community well-being.

Brand motivations

Why brands choose to get involved in sustainability projects and how visibly depends a lot on who they are. This past February, Kumar’s firm launched “Entropia Empathy”, a specialist offering that consults clients on infusing purpose into brand and business behaviours, to promote the UN sustainable development goals (SDGs).

Kumar agrees with Ngui that there is a new level of mounting pressure coming from both stakeholders and the public: “It is not enough for companies anymore to just do their economic duties, pay their taxes and get by as only an economic machine. There is a an expectation that they contribute to a sustainable future,” he says.

But Boaz Paldi, the global engagement and partnership manager for the United Nations Development Programme (UNDP) says every company looking to partner with them on SDGs have their own motivations.

“It's very hard to generalise,” he tells Campaign, noting some involve very a personal commitment by key individual and some companies are truly committed to creating a positive impact in society and for the planet. Another “big reason,” he says are companies that simply want to be seen to be sustainable (those who like to slap UN logos next to their they call blue-washers) and then comes the considerations of consumers.

Paldi is also the project lead for The Lion’s Share, the 2019 Cannes Grand Prix-winning initiative from Clemenger BBDO’s production partner Finch in Australia. Its aim is to sign up brands who use endangered animals in advertising to up to donate 0.5% of paid media spend to fund wildlife conservation projects.

The founding brand partner is Mars, which as a food producer and pet nutrition company found a close affinity in caring for animals, Paldi says. As a privately owned company, the Mars family is highly committed to the cause. But he adds it’s the thousands of Mars employees who have been very keen on seeing purpose in action.

“That's another big motivation for companies to have sustainability as part of their core business, to really attract and retain talent,” Paldi says. “That's definitely what we hear from Mars.”

“Looking at all those motivations together, Paldi continues, I think brands understand that being stainable is now becoming good for business because that's what the consumer expects.”

Kumar agrees there is a baseline hygiene expected by consumers around sustainability commitment that will continue to rise over time. But different brands have different needs depending on where they sit on the sustainability spectrum.

How visible?

Fossil fuel energy companies or those who have a dodgy supply chain have a much greater need to reinforce their sustainability commitments than those in neutral or less harmful industries, Kumar says.

Those companies may need to have their branding more visible too Kumar says, though both he and Paldi agree that corporate branding cannot be a motive in itself. Insincerity only invites a popular backlash.

The key, they say is to be genuine, no matter what kind of spotted record or history the company is starting out with, because the greater societal needs are genuine too and require change from bad actors. Paldi says with 17 sustainable development goals and 169 targets, there is an ample amount of work to be done that require a “very, very big” responsibility from the private sector.

“We understand there are no saints out there. There might not all be devils but they're certainly not all saints,” Paldi adds. “So, by taking a step in the right direction, starting somewhere to think about sustainability in some way, starting somewhere to think about purpose in society and global impact for the environment and climate change, that for us is a really important step for companies to take.”