The Consumer Study From Marketing To Mattering

Despite growing commitment to environmental and broader sustainability issues, business leaders believe the global economy is lagging behind the action required to set us on a more sustainable pathway. While a majority of Coos see sustainability as critical to the future success of their business, many express a sense of frustrated ambition' at the pace of change in embedding sustainability into core business and global markets.

At the centre of their dilemma is a struggle to quantify the business value of sustainability, and to track the rewards of adopting a leadership position in their industries. Contributing to Coos' frustrated ambition is the challenge of interpreting signals from consumers, the group consistently identified by business leaders as the most important in guiding their action on sustainability.We see clear signs that consumers expect more from companies, from greater honesty and transparency, to greater impact on global and local challenges and a more responsible stewardship of natural resources and the environment. Yet among business leaders there is a sense that companies have failed to engage the consumer on sustainability; that companies' reputation and performance on environmental, social and governance issues are not informing consumers' purchasing decisions; and that industry leaders on sustainability are not being rewarded by the market. With market factors increasingly driving business approaches to sustainability, an in- depth understanding of consumer views is critical to inspire accelerated progress, and to unlock the full potential of the private sector in addressing these challenges.This year, for the first time, Accentuate and Haves Media Group's RE:PURPOSE have collaborated to extend the reach of the UN Global Compact CEO Study on Sustainability to encompass the view of consumers worldwide.

To this end, we have conducted a study of 30,000 adults Sharon Johnson CEO Haves Media RE:PURPOSE Peter Lacy Managing Director Strategy & Sustainability Accentuate Asia Pacific across twenty countries to understand what they expect from business and other institutions; what 'sustainability means to their choices and attitudes; how sustainability issues impact their purchasing decisions; and how superior performance on sustainability can better engage consumers, driving value creation and genuine competitive advantage.Our study suggests that most brand-initiated dialogue on sustainability fails to connect with the priorities of consumers, and suggests that better understanding and harnessing the link between practices and expectations may offer a compelling business case for companies to place sustainability at the centre of their strategies for growth. The study also points to major issues hampering the credibility and trust advantages that sustainable, responsible practices should offer to forward-thinking companies. It outlines a blueprint for three fundamental imperatives that will break own these barriers, to enable companies and brands to move from 'marketing to mattering' by leveraging sustainability to create market performance advantages.

In producing this report, we have been indebted not only to the survey participants, but to our research partners who have enabled us to assemble a rich and diverse set of insights, exploring, testing and refining emerging themes and ideas. We would like to acknowledge the contributions of the Global Compact sponsors and project leads George Keel, Gavin Power, Carrie Hall, Sean Cruse and Kristin Coco, as well as the leadership of the Haves Media RE:PURPOSE and Accentuate teams, in particular project leads Rob Hayward, Deed McLean and Angela Kanji. This year's study is a unique opportunity to take stock as we stand at a crossroads in the global economy, as business, governments and civil society come together to set new and ambitious goals for the next wave of sustainable development.Business leaders are committed to leading the way, but will require greater ambition and wider support as they work to align sustainability impact with value creation, and markets with sustainable development outcomes, such that these leaders can truly become the architects of a better world. 4 Optimism and quality of life: a three-speed world For marketers in every sector, optimism can be a powerful force.

Efforts to engage, inform and persuade consumers on the merits of companies embracing sustainability can tap into visions of the future, and will depend on companies' ability to fulfill the expectations of twenty-first century people. The millennial consumer, coming of age economically and empowered by new technologies and social media, is driving new expectations of all institutions in society, especially business.Expectations now go well beyond the direct utility of products and services: people in every part of the world see the act of expenditure and consumption as a means to Vote with their wallet' - to enhance health and livelihoods, to boost community wellbeing, and to shift the direction of the world. For western businesses and for emerging-market multinationals - and it is clear that consumers in these markets are looking directly to business to fulfill their optimism for the future. Our survey of 30,000 consumers across twenty countries shows a striking disparity at cantonal level in people's optimism for the future. We see a three-speed world emerging, as economic growth and development has a critical impact on the outlook of consumers worldwide.

Our data shows that optimism is closely tied to those high- growth economies where growing national prosperity is boosting household incomes and drawing greater numbers into the global 'middle class'. As incomes rise, growing numbers of households participate in the consumer economy, and are able to afford discretionary purchases such as healthcare services, basic leisure goods and homewards. These high-growth markets will be essential to companies' future prospects, both The millennial consumer, coming of age economically and empowered by new technologies, is driving new expectations of business. People in every part of the world see the act of expenditure and consumption as a means to enhance health and livelihoods, boost community wellbeing, and shift the direction of the world.Across Western Europe, in economies still feeling the aftereffects of the financial crisis, with sluggish growth and high youth unemployment, expectations of the future are subdued: just a quarter of all respondents expect their quality of life to improve in the next five years. In Asia and North America, the outlook is more positive - around half of all respondents expect their quality of life to improve - but Africa and Latin America display the most widespread optimism, with 83% in Africa and 85% in Latin America expecting their quality of life to improve.

Data from Haves Media/Accentuate survey of 30,000 consumers worldwide. Numbers by country represent net positivist: proportion of respondents expecting an improvement in their quality of life over the next five years minus the proportion anticipating a decline.Business: generating value by living up to greater expectations Business is failing to take care of the planet and society. That is the stark finding from our survey of 30,000 people across twenty countries in five continents: fully 72% of those we surveyed believe that business is failing to live up to expectations. This accords with the assessment of business leaders themselves: 67% of the 1,000 Coos surveyed for the most recent UN Global Compact-Accentuate CEO Study on Sustainability reported that business is not doing enough to tackle sustainability challenges.

Dissatisfaction with business is spread throughout the regions we surveyed, with assessments relatively stable by gender and age bracket.Western European respondents are particularly vociferous in their disappointment, with 88% of those in Germany and 84% in France reporting that business is failing in its responsibilities to the planet and society. Respondents in Mexico (60%), Argentina (65%) and Japan (65%) are less critical, with the most positive view coming from Russia, where Just 54% believe business is falling short of expectations. Today's citizen consumer has higher expectations of business. Dissatisfaction may be regarded as the product of traditional approaches to communicating sustainability, centered on philanthropy and corporate social responsibility, with no clear integration into the products and services people consume, or the connection through their products that brands share with consumers.

As sustainability has established itself on the leadership agenda for the vast majority of multinationals, companies have gone to ever greater lengths to paint a solitaire of a responsible corporate citizen, committed to the prosperity of the communities in which they operate. Our survey suggests that these traditional approaches have failed to engage and persuade the consumer, most notably in those markets where sustainability branding and communications have taken root most deeply. In Western Europe and the United States, those economies most affected by the financial crisis, the crisis in trust is readily apparent, with fewer than 20% of respondents expressing their confidence in companies' efforts to take care of the planet and society.Strikingly, in those economies with a large, emerging middleman's, people are less skeptical and public inference is significantly greater: two-thirds of respondents in Nigeria and India, for example, believe that business is playing its part. Today's citizen consumer has higher expectations of business; dissatisfaction may be the product of traditional approaches to sustainability, centered on philanthropy and CARS. By country represent proportion of respondents answering 'agree' and 'strongly agree'.

Accountability: governments, business and rising expectations People hold business directly accountable for their quality of life - and this expectation is fuelling a sense that business is failing to meet its obligations.In this respect, brands are failing to connect corporate sustainability efforts to the expectations and priorities of their consumers, and with the failure of traditional approaches to sustainability all too readily apparent, we see an urgent imperative for companies to understand how they can better engage the consumer in their sustainability stories. Over the next five years, yet a similar proportion expects brands and companies to enhance their outlook. One message is clear: people hold companies as accountable as governments for improving the quality of their lives.

In every region we surveyed, respondents' expectations on business are almost identical to those of governments: globally, 86% expect governments to directly improve their quality of life; 85% expect the same of the companies from which they buy. In high-growth economies, people are highly engaged and expect business to help them attain their optimistic vision for the future.In India, 85% expect a better quality of life in five years' time, and fully 92% of people believe companies should help to realize their hopes for the future. And Indian consumers are already engaged: 73% port that they actively buy responsible brands. As business leaders acknowledge, abstract approaches to sustainability have failed, and will continue to fail, to engage the consumer.

Instead, companies must communicate how their products and services, and the wider impact of their operations, benefit those they serve and the communities in which they operate, and contribute directly to improving lives. Whether optimistic or despondent about the future, across all markets people expect brands and companies to impact positively on their lives.In developed markets across Europe and North America, people aren't engaged, they're despondent about the future and they want business to help. In France, for example, one of Rupee's large consumer markets, consumer attitudes exemplify those of most developed countries. Only 44% of respondents say they actively buy more responsible brands, well below the global average of 57%.

More than three-quarters say their quality of life is unlikely to improve Strikingly, there is a clear correlation in our survey between respondents' optimism regarding their quality of life, and their expectations on business not Just to look after he planet' in an abstract manner, but to deliver direct and tangible improvements to their own quality of life.In those countries where people express most positivist about the future, and expect the greatest improvement in their quality of life, expectations on business are highest: in western Europe and Japan, where pessimism is widespread, respondents have corresponding lower expectations of business; in Brazil, India and Nigeria, for example, where the People think business is as accountable as governments for improving their lives Companies Government Global 85% 89% Asia North America 9% 94% Europe Data from Haves Media/Accentuate survey of 30,000 consumers worldwide Latin America vast majority expect their lives to improve dramatically, people are looking directly to business to deliver this improvement.For business, fulfilling these expectations will depend in part on building public trust. Throughout the lifespan of the CEO Study, business leaders have cited 'brand, trust and reputation' as the single most important factor in motivating them to embed sustainability into core business. Our findings from consumers, though, suggest that companies' efforts on sustainability ay have failed to connect their actions with the genuine priorities of consumers, and this may be hampering progress on building trust.

Highlighting the stubborn problem of building public trust, 'ending corruption' ranks as a leading challenge for respondents across all twenty countries surveyed.When aggregated across our global sample of 30,000 people worldwide, the challenge of corruption ranks ahead of Job creation and economic growth. A deeper look at the data sees ending corruption ranked as the most important of twenty-three issues for my country to address' in numerous emerging and developed economies. The challenge of corruption is not simply one for governments to address: in many of the markets surveyed, corruption also ranks as a top-five challenge for business to address.

In the I-J, for example, corruption is regarded as the sixth most important issue for the country, but the third most pressing issue for business to address after job creation and economic growth.The prominence of corruption suggests that the concept may have evolved in the mind of the public to embrace a holistic ethical picture affecting business and governments alike. People across the world, empowered by social media ND independent sources of information, are increasingly aware of the operational behaviors of companies, and assess brands and services accordingly. Issues ranging from labor practices to executive pay and corporate tax are discussed in the media and across social media.

In this increasingly open and democratic context, the challenge of trust and accountability must be addressed through openness and transparency, as well as through 'living the brand' in all spheres of operations.