A new study shows that sustainability is a key driver for companies. The "Balancing Sustainability and Profitability Study" was conducted among 200 executives and 1500 consumers in the UK before the outbreak of the Covid 19 pandemic. The study shows that increased conscious consumer behaviour is driving companies to integrate sustainability transparently into their business operations. However, with a new generation of consumers increasingly demanding greater transparency in the area of sustainable business, the study also shows that two-thirds of companies are finding it difficult to measure the impact of their sustainability strategies.
The new survey found that 61% of consumers expect the brands they buy to have clear sustainability practices. While 65% of consumers say that price remains a key factor in their purchasing decision, more than half of those surveyed in the last six months said that they bought a product specifically because it had reusable or biodegradable packaging. Boris Maschmann, Managing Director of Smurfit Kappa in Germany: "Consumers are increasingly driving the sustainability trend. We expect this to continue after the Covid 19 pandemic.
The driving force of conscious consumer behavior is confirmed by the study, with 63% of companies stating that their attitude towards sustainability is customer-oriented. Half also add that greater awareness among business customers and consumers of the intensity of their sustainability practices is most beneficial and crucial to their long-term impact. At the same time, the research also shows that 69% of consumers have difficulty understanding the sustainability of a brand.
This discrepancy suggests that there is a knowledge gap between brands and consumers and that brand leaders face the challenge of communicating better about their sustainability activities.
"In general, more education is needed. If brands act correctly, the relationship between brand and customer can be strengthened enormously," says Boris Maschmann.
Improved customer experience and satisfaction are the leading metrics used by 58% of companies surveyed to measure the return on investment of sustainability practices. However, the "Balancing Sustainability and Profitability Study" also found that only 18% of companies currently measure their sustainability plans at all, with 4 out of 10 companies stating that measurement is the biggest obstacle to implementing sustainable practices.
The survey also showed that 82% of company executives view sustainability as a long-term investment rather than a mere cost factor. It is important to note, however, that this is changing the rules of financial reporting in almost three-quarters of companies, while at the same time less than half of the companies are able to link sustainability to financial results.
Ken Bowles, CFO of Smurfit Kappa: "More than ever, the study results underline the need to create a structural environment in which companies can achieve sustainable business without additional cost pressure. This requires a multi-dimensional dialogue between industry, government, regulators and consumer representatives to ensure that a common approach is agreed to enable companies to achieve sustainability financially.
Smurfit Kappa publishes progress on long-term sustainability goals in its annual sustainability report to make transparent how internal sustainability commitments are being translated into reality. Smurfit Kappa Group has set ambitious long-term goals in five key areas where it can make a difference.
Growing social and environmental awareness is increasing the pressure on companies to play their part in reducing the impact of climate change and waste. The survey found that 72% of companies see sustainability as a lasting trend. Sustainability also opens up growth opportunities for companies, with 83% of companies surveyed citing sustainability as a business opportunity to be seized.
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