Consumers’ environmental and social demands should be front and centre

Constant change, volatility and uncertainty have become hallmarks of the current marketplace rather than the exception. In this context, the social and environmental sustainability imperative for brands has become more urgent, particularly for brands that want to establish leadership and move from ambition to action.

Kantar’s sustainability sector index answers five key sustainability questions to help brand owners prioritise their marketing focus and investments.

The first is what it is that consumers care about in a particular sector. This aims to identify the most relevant sustainability concerns, both environmental and social, that need to be addressed by the sector and business in relation to the UN’s Sustainable Development Goals (SDGs).

The second question is about how to address these concerns authentically, and requires that businesses pinpoint what they need to focus on to deal with them.

The third question is focused on the related sustainable behaviours. Businesses need to highlight the consumer behaviours that will help them address concerns in their sector and size the value-action gap. The latter is the phenomenon of people acting in way that is inconsistent with their values. Brands need to look at what consumers claim to hold true as their values and compare these to their actions. They can then more easily determine where consumers see friction, and can provide solutions to facilitate an easier transition to the adoption of more sustainable practices. Closing the value-action gap, says the UN is the Holy Grail in overcoming the barriers to sustainable consumption.

The fourth question centres on how to close the value-action gap. Kantar’s actionable guidance explains how businesses can fuel adoption and remove the friction to drive sustainable consumer behaviours.

The last question is: how can businesses deal with different sustainability audiences. This is about targeting the various sustainability segments in a business’s consumer base in a relevant way.

The sustainability sector index covers 38 sectors across 33 markets. It provides a global and regional picture, built up from local market data. More than 30,000 interviews that were conducted globally, and more than 6,000 interviews undertaken in the Middle East and Africa, revealed that people’s needs are rooted in what affects their daily lives.

Global issues are most relevant to people when framed from the perspective of local effect and context. Inflation, the costs of living and climate change, for example, are global crises that are felt in people’s daily lives. Structural social inequalities and environmental issues are increasingly real and raw. As a result, people are shifting from an abstract feeling that society needs to change to focus on specific actions that are demanded from governments, businesses and individuals.

People’s concerns are also based on Maslow’s hierarchy of needs. In Africa and the Middle East, the focus is closely linked to physiological and safety needs and  top-of-mind sustainability concerns mirroring this trend. In contrast, in the global north sustainability concerns and sustainable living is for many a lifestyle choice connected to values, morality and creativity.

The index reveals that the top sustainability concerns for consumers in the Middle East and Africa region have a social orientation and include poverty and hunger, health and wellbeing, equality and decent work and economic growth. Environmental concerns relating to clean water and sanitation, climate action and responsible consumption and production also feature among the top concerns. Interestingly, compared with the 2021 index, consumers now have more concerns and are taking a broader societal view.

The Middle East and Africa are  disproportionately affected by the combined effect of global and local economic, social and environmental crises. In addition to political instability, economies such as Nigeria and Egypt are facing skyrocketing inflation. Also, extreme weather events have taken place, including in South Africa, and locust infestations have caused havoc in East Africa.

Though the Middle East and Africa are predicted to be the fastest-growing regions globally, they are also the most vulnerable, with people at the frontline of multiple crises. These crises ultimately affect businesses’ ability to operate, both in terms of their supply chains and the spending power and needs of its consumers.

The majority of people in the Middle East and Africa want to consume better and are paying attention to what brands are doing on social and environmental issues. Most respondents say they pay attention to the causes brands support when making purchase decisions. That means that the social and environmental effect that brands have is no longer a nice-to-have but a business imperative.

Most people say they are prepared to take action to live a more sustainable lifestyle. The challenge, however, is a perception that products with a positive environmental or social impact come at a premium price. As a result, sustainability is often a luxury of the affluent.

A significant commercial opportunity, therefore, is to make  sustainable options mainstream. Another opportunity is to meet the consumer need for long-lasting and durable products. This has wide application and could include reframing waste as value, packaging innovation or the development of new products and services using circular economy principles.

Companies that focus on societal and environmental sustainability and shared value creation will futureproof their business. This is because a sustainable transition is not purely a risk management exercise but a societal impact imperative and a commercial opportunity.

A sustainable transformation offers tangible shared value in the form of driving efficiencies internally, higher brand value growth, the ability to attract talented and passionate people and the potential to grow shareholder and investor value. For these reasons, sustainability should be approached proactively with a mindset of investing in risk rather than merely mitigating it.

Sustainability contributed $193bn to the value of the Global BrandZ Top 100 companies in 2023 while brands with the highest BrandZ sustainability index rating grew 31% year on year, indicating that brands that are making a positive difference are creating value.

The challenge for businesses today is converting macro- corporate ESG strategies to a brand strategy that connects with consumers without being perceived as green washing. This is no easy feat, given the large gap that exists between the UN’s SDGs, the progressive business model and a relevant, meaningful brand activation plan.

Businesses need to think carefully about the role they have a right to play in society. Those who successfully translate their corporate sustainability strategies into brand action and get their “consumer licence to operate” right have an opportunity to connect meaningfully with society and their customers. However, those who don’t get it right can expect to be accused of inauthenticity and green washing. Critically, businesses need to focus on local market realities and on delivering clear shared value while remembering that different sectors have different priority platforms.

Brands have the power to enable consumers to make behaviour changes through innovation, creative communication and partnerships. Key to this is closing the value-action gap.

In conclusion, the four universal truths for brand leadership in the Middle East and Africa are that products that are good for society and the environment must be affordable to have a mass impact, that locally sourced ingredients and production need to be a critical focus, that circularity has become an expectation and that sustainability needs to be baked into the innovation process from the outset.

The big take-out: Companies that focus on societal and environmental sustainability and shared value creation will futureproof their business.