The commercial impact of ESG cannot be understated. While the primary objective of an organisation’s ESG activities is and should always be the preservation and protection of limited resources, the wellbeing of employees and communities, and transparency and accountability through compliance, organisations should also be aware of the benefits and impacts that a proactive approach can have on their own bottom-line.

Building Trust

Perhaps one of the most significant impacts that ESG can have on an organisation’s financial performance, is consumer trust. A study by the Conscious Consumer Council found that 59% of individuals chose to purchase goods or services from companies that they considered to be socially responsible.

Marketers working in companies that have committed to ESG have an opportunity to showcase these activities, and to establish their organisation as a progressive market-leader.

Promoting an organisation's ESG activities is not without its risks. Savvy consumers are quick to reject organisations that they deem insincere or that have been guilty of greenwashing. A study by the Harvard Business Review found that customers are receptive to the gap between an organisation’s stated goals and actual activities; the consequence of which is an overall drop in customer satisfaction.

Brand Loyalty

Global markets across all verticals have become increasingly competitive. Organisations must differentiate themselves if they are to remain relative and develop brand loyalty. A study by ESG Research found that consumers develop stronger loyalty and trust towards companies that demonstrate genuine ESG commitments. This impact is reflected further in an IBM report that ESG Leaders are 43% more likely to outperform their peers on profitability.

Attracting Talent

The benefits of promoting a company’s ESG efforts don’t end with consumers. It can also prove instrumental in attracting the right talent. In a recent study, 80% of people surveyed stated that it’s important that a company's values align with their own. In that same survey, 77% of respondents stated that they expect their company to be a force for good in society.

Be Sincere

The benefits of ESG to marketers reminds me of a joke. In the 1960’s, Director Stanley Kubrick was approached by the US government to help fake the Moon Landing. Being a perfectionist however, Kubrick insisted that they filmed on location.

Marketers should adopt a similar mindset. Why fake it, when the negative impact of getting caught, far outweighs the cost of simply doing it for real?

Organisations hoping to reap the benefits of their ESG activities should do so from a place of sincerity, purpose, and transparency. It's better for everyone; companies, customers, communities, and the planet.

How can SustainIQ help?

SustainIQ is an integrated ESG reporting platform that unifies all aspects of an organisation’s sustainability activities within a single environment. Businesses use SustainIQ to measure, monitor, and report on their social, economic, and environmental performance in real time.

Using SustainIQ, organisations can create reports that demonstrate their commitment to delivering value beyond their bottom line.

To learn more about SustainIQ or to arrange a demo click here.