The CEO/consumer disconnect on sustainability

Despite the effects of The Great Recession, 93% of corporate CEOs say sustainability will be critical to their companies’ future success. Even further, CEOs believe that, within a decade, a tipping point could be reached that synchs sustainability with core business capabilities, processes and the global supply chain. These findings are based on a survey of 766 CEOs from around the world in “A New Era of Sustainability: UN Global Compact-Accenture CEO Study 2010” that was released Tuesday.

Other key points:

  • 80% of the CEOs say the downturn has raised sustainability’s importance. It’s being recognized as a way to save money while also selling more product.
  • 81% say sustainability had become part of their company’s strategy and operations. Many CEOs say there’s been progress over the past three years in transitioning from “talking sustainability” to actually “doing sustainability.”
  • 91% say their companies will use new sustainable technologies over the next five years, such as developing renewable energy and creating greater energy efficiency. (Again, saving money that can go right to the bottom line.)
  • 72% say corporate “brand, trust and reputation” are the biggest motivators for acting on sustainability. Other drivers: Potential for revenue growth and cost reduction (cited by 44%), personal motivation (42%), and consumer and customer demand (39%).

What’s one of the primary actions needed before sustainability can be fully integrated into a company’s core business? CEOs said, “Shaping consumer tastes to build a stronger market for sustainable products.” Unfortunately, here’s where the CEO/consumer disconnect comes into play.

Consumers just don’t seem to know what sustainability even means. A recent Incite survey showed that 44% of respondents associate it with the environment, another 44% believe it’s a concept dealing with financial security, and the remainder had no idea. Incite also found that consumers are much more interested in value and customer service; sustainability ranks only fifth out of six purchase-decision factors.

My Thoughts: CEOs finally get it; consumers…not so much. Maybe it’ll just take a lot longer for Average Joes to really key into this “sustainability thing.” After all, they’ve got other stuff on their minds…such as keeping a job and paying the bills. Right now, sustainability is still more of a business buzzword than an Everyman phrase.

But that will change with time. And in the meantime, if consumers want value (more for less money), your CPG customers can give it to them through their own sustainable actions driving down their costs. It simply moves up the supply chain. You need to be more efficient (more sustainable) to drive down your costs to pass it forward. Just don’t give it all away.

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1 Response to The CEO/consumer disconnect on sustainability

  1. It seems like the consumer isn’t “getting it” because often times it costs more to exercise sustainable habits. It either costs more in time (growing your own…, using public transportation, etc.) or in money by buying products that are developed using sustainable practices. I’m curious about the CEOs “getting it”.

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