The 3 additional drivers of sustainability your company can’t afford to miss
Shelton Stat of the Week
28% of American business decision-makers say their companies are using a supplier sustainability scorecard in their purchasing process. Another 28% say they’re developing one.
At Shelton Group, we keep our finger on the pulse of what the market is believing and expecting from companies re sustainability. We do that through our ongoing, proprietary Pulse™ studies – which includes surveying consumers AND business decision-makers – and by tracking other studies on the topic from respected companies.
We write here a lot about the consumer – and have been pointing out the trends in a sustainable direction for years:
- 86% of Americans expect companies to stand for something other than just making money.
- 41% want to be seen as someone who buys green products.
- 25% can name a brand they’ve purchased – or not purchased – because of the sustainability record of the manufacturer.
But the consumer isn’t the only pressure point for companies. In fact, lately we’ve seen a few other drivers pushing corporations to action. If you’re not feeling these three pressures yet, my guess is you will very soon:
- Business decision-makers want to buy from sustainable companies. Are you a supplier to businesses or part of a large company’s supply chain? Then you’re likely already feeling these realities, captured in our 2018 B2B Pulse® study:
- 62% of business decision-makers say a supplier’s environmental performance is important-very important when selecting a supplier or making product purchase decisions.
- 51% say they include sustainability-related questions in their RFPs.
We’ve had companies call us in a panic because they were hit with a scorecard request from a customer and weren’t prepared to answer the questions.
- Investors increasingly want to invest in companies who prioritize ESG. We’re seeing this in our business as well – we’re getting calls from companies that “need to tell their sustainability story” because Wall Street players have suddenly started asking a lot of questions about the company’s Environment, Social and Governance (ESG) practices or public ratings. Natixis, whose ESG funds Shelton Group’s 401k is invested in, published a study last year that revealed that nearly two-thirds of institutional investors believe ESG investing will become the industry standard in the next five years. If you work for a publicly traded company, check out how you’re rated by the various ESG ratings agencies and make sure it’s how you want to be seen and represented to investors.
- Employees want to work for sustainable companies. Cone Communications does some great work tracking employee sentiment. In their last study (2016) they discovered that 58% of people in the workforce consider a company’s social and environmental commitments when deciding where to work – and that number jumps to 79% when you just look at Millennials, the largest age cohort in the workplace. Additionally:
- 51% say they won’t work for a company that doesn’t have strong social or environmental commitments
- 70% say they’d be more loyal to a company that helps them contribute to social and environmental issues – and that clocks in at 83% for Millennials.
Consumers and business decision-makers expect to buy from companies that are consciously doing the right thing for people and the planet, investors want to invest in those companies and employees want to work for them. I can’t think of a more foundational business case for why your company should be taking action on sustainability.