What are ecological sustainability practices

Conscious consumption forces companies to be even more sustainable

A new study shows that sustainability is a key driver for companies. The Balancing Sustainability and Profitability Study was conducted among 200 executives and 1,500 consumers in the UK prior to the outbreak of the Covid-19 pandemic. The study shows that increased conscious consumer behavior drives companies to transparently integrate sustainability into their business operations. In view of the growing demand from a new generation of consumers for more transparency in the area of ​​sustainable management, the study also shows that two thirds of companies have difficulties in making the effects of their sustainability strategies measurable.

The study was commissioned by the leading manufacturer of corrugated cardboard packaging Smurfit Kappa and carried out with the Financial Times. The views of business and consumers on sustainability were examined and how both groups adapt to realize a more sustainable future.

61% of consumers expect brands to have clear sustainability practices

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 is still a decisive factor in their purchase decision, over half of those surveyed in the past six months said that they bought a product specifically because it was reusable or organic had degradable packaging. 56% also paid more for a product that was sustainably sourced. Boris Maschmann, Managing Director of Smurfit Kappa in Germany: "Consumers are driving the sustainability trend more and more. We assume that this will be the case after the Covid 19 pandemic will stay."

The driving force behind conscious consumer behavior is confirmed by the study, as 63% of companies state 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 for their long-term impact. At the same time, however, the study also shows that 69% of consumers have difficulties understanding the sustainability of a brand.

This discrepancy suggests that there is a knowledge gap between brands and consumers and that branding companies are faced with the task of better communicating about their sustainability activities.

"In general, more education is necessary. If brands act correctly, the relationship between brand and customer can be enormously strengthened," says Boris Maschmann.

Two thirds of companies have difficulty measuring their sustainability strategies

Improved customer experience and satisfaction are the leading metrics that 58% of companies surveyed use to measure the return on investment from 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 reporting that measurement is the biggest obstacle to implementing sustainable practices.

The research also showed that 82% of company executives view sustainability as a long-term investment rather than a pure cost factor. However, it is important to know that this will change the rules of financial reporting in almost three quarters of companies, and at the same time less than half of companies will be able to link sustainability with financial results.

Ken Bowles, CFO of Smurfit Kappa: "The results of the study underscore the need, more than ever, to create a structural environment in which companies can implement sustainable business practices without additional cost pressure. to ensure that a common approach is agreed that also enables companies to do business sustainably financially. "

Smurfit Kappa publishes progress in the area of ​​long-term sustainability goals in the annual sustainability report in order to make transparent to what extent internal commitments in the area of ​​sustainability are being implemented. The Smurfit Kappa Group has set ambitious, long-term goals in five key areas where it can make a difference.

The topic of "sustainability" will remain

Growing social and environmental awareness puts pressure on companies to play their role in reducing the effects of climate change and waste. The evaluation showed that 72% of the companies see sustainability as a permanent trend. Sustainability also opens up growth opportunities for companies, as 83% of the companies surveyed described sustainability as a business opportunity that should be used. "Sustainability is a growth catalyst, but companies will have to find a balance between sustainability practices and profitability if they want to secure long-term stakeholder approval. Companies that see the value of a long-term investment now will win in the future," said Boris Maschmann.

About the study

The data presented in this article is based on two surveys commissioned by Smurfit Kappa and conducted by Longitude, a division of the Financial Times, in January 2020. The first, a survey of 200 UK business leaders and executives, examined attitudes and approaches to sustainability among companies in the FMCG, retail and e-commerce and consumer goods sectors.

The second, a survey of 1,500 UK consumers, looked at consumer attitudes and beliefs about sustainability, their impact on consumer behavior and consumer expectations of companies' sustainability policies.

In addition to the quantitative studies, Longitude also conducted a series of in-depth qualitative interviews between January and March 2020 in order to gain insights into the sustainability of companies from practice