Consumers Demand Transparency as a Way to Prove Corporate Sustainability
The strict bottom-line approach to business has shifted in recent years to an emphasis on sustainable business growth grounded in strong consumer allegiance. As consumers become more eco-aware and socially responsible, they are demanding that corporations follow suit. What exactly does this mean? It means that consumers do not merely prefer but expect corporations to make positive social and environmental changes that are transparent.
Transparency is key and although sustainability reporting is largely voluntary it has come to be a norm among large companies. There has been a dramatic increase in sustainability reporting which has given the consumer an upper hand in demanding the adoption of sustainable practices. As more and more companies shift their business practices to become more eco-friendly there is a greater demand for transparency within their sustainability reporting. It is not just about saying that a company is adopting sustainable practices but it is about proving it.
Motivated to buy products that are eco-friendly, consumers are looking to corporations to make long-term investments in sustainability strategies that meet short-term consumer needs while contributing to long-term positive change on the environment. Without a doubt, we are living in an increasingly post-material age—one in which we are simply transferring material resources to meet a need, want, or desire. Indeed, consumers are becoming increasingly savvy about the businesses they support, in particular about what their patronage of a particular business says about them as an individual. Consumers do not want corporations to simply make a product that they need at an affordable price. Rather, they are now analyzing their level of consumption and demanding that products be made in a socially conscious way.
It is incumbent on the corporation to explain to their consumers how their business models are socially conscious. At this point there is no legal framework or uniform definition for sustainability reporting. Therefore, it has grown tremendously important for corporations to consistently communicate how their long-term sustainability strategy will positively impact the society and environment. As consumers become more environmentally and socially aware, the expectation for corporations to openly communicate and be as transparent as possible about their sustainability practices is deeply rooted in presenting facts, goals and expectations.
This new competitive landscape has made sustainability reporting less of a trend but a necessity in order to meet the consumers’ expectations. However, there is still much skepticism as to how corporations are relaying their message. Just because a corporation issues a sustainability report does not mean that they are truly catering to the needs of the consumer while also taking into consideration the environment. Due to a lack of uniform definition on how to report on sustainability it is up to us, the consumer, to continue educating and demanding certain expectations.
To find out more information about trends and issues in sustainability reporting check out: http://www.triplepundit.com/2010/02/10-trends-in-sustainability-reporting-great-minds-think-alike/
