Powerful evidence has emerged to suggest that companies stand to gain far more than they could potentially lose by sticking their necks out and taking frank, honest stances on hot-button social issues.

In its new report From Me to We: the Rise of the Purpose-led Brand, [1] global business consultancy Accenture polled almost 30,000 consumers around the world to gauge their expectations of contemporary brands and companies. According to the study, firms that i) stand for something bigger than the products or services they sell, ii) communicate their purpose effectively and iii) demonstrate commitment to it are more likely to attract consumers and influence purchasing decisions, thereby boosting their competitiveness.

Indeed, the report stresses: “Companies that don’t step up pay the price. Consumers who are disappointed with a brand’s words or actions on a social issue complain about it. That’s not surprising. What’s different now is that 47% walk away in frustration, with 17% not coming back. Ever.”

With that in mind, the report recommends that brands should square up to social issues with an upfront, bullish attitude, rather than clamming up or letting matters slide when they have an chance to make a constructive contribution.

Companies it cites as exemplars include apparel manufacturer Patagonia, which has won a firm following with its environmental work, and sportswear giant Nike, which saw a jump in online sales of 32% – 6.4% above the average industry growth rate – after hiring controversial NFL star and activist Colin Kaepernick to front a major ad campaign.

In a statement, Accenture Strategy managing director Kevin Quiring said: “In this era of radical transparency, consumers are voicing their opinions, values and beliefs, scrutinising the actions of organisations and their leadership, and holding them accountable. They can see through inauthenticity and won’t tolerate it. Consumers’ voices can change the financial trajectory of companies. They are more than buyers – they are active stakeholders who are investing their time and attention and want to feel a sense of shared purpose. The winners in this era will not be passive bystanders.” [2]

However, some brands that have not been known to take assertive stands on social causes – but now feel that it’s time to step up – may be unsure of how to announce their allegiances. How should they go about this?

The Institute of Leadership & Management's head of research, policy and standards Kate Cooper says: “These findings are useful additions to ongoing research on the importance that millennials, in particular, place upon socially conscious brands and businesses. Perhaps millennials are more influential in this debate because they have a more natural facility with social media, but given that Accenture polled 30,000 customers – a large cross-section of people – it’s safe to infer that most of us, whatever our demographics, would prefer to be associated with companies whose values we share or admire.

Cooper notes: “While customers are hugely significant stakeholders, their power is routinely underappreciated and they are often not listened to as keenly as they would like. Now that brands have spent many years honing their expertise with social media, it is easier for them to cut through that sense of jaded resignation and make an impact with powerful, social statements – as Nike has done. But at the same time, if you are being in any way duplicitous or hypocritical in your campaigning, it is far more likely that you will be found out.”

She points out: “Patagonia is quite an interesting case study – about five years ago, it ran its famously counterintuitive ‘Don’t Buy This Jacket’ campaign, [3] which urged consumers not to buy the brand’s goods if they already had winter garments tucked away in their cupboards. This was a clever piece of what we might call ‘non-advertising’, designed to focus customers’ minds upon the environmental effects of Black Friday-style, excessive consumerism. Across the entire outdoor-wear market, no other brand was doing anything even remotely like that – so Patagonia had a clear run at delivering a timely message.

Cooper explains: “In terms of how organisations that are new to this field should get started, there has to be absolute clarity within the senior team about the firm’s ethical position and what it will stand for. What does it consider to be right? What will it not tolerate? There are no books or manuals that will help companies make those decisions – it’s a much deeper and more intuitive set of considerations than that. The ethical position may manifest itself in codes of conduct and protocols. But really, it’s the belief that must be firmly held to ensure that the procedural stuff holds up and makes sense.

“In the field of ethical business, procurement practices can be so important. You yourself may feel that you are behaving ethically – but when you go further along your supply chain, perhaps you will uncover transgressions. Particularly among large companies with complex supply chains, you can’t always police every process down to the finest detail. But what you can do is state very clearly that if transgressions are brought to your attention, you will take action, and do so promptly. You will not fudge it. When companies make mistakes, what counts is the owning up, and the genuine desire to right the wrong.

“Once you have decided internally what you stand for, and how your ethical position will play out within the fibre of the organisation, you ought to find that the relevant messaging will become easier to communicate to the public. Responding when things go wrong always sends out powerful signals – so risk assessments and contingency planning should absolutely be part of your overall strategy.”

Cooper adds: “Never underestimate the clout that you could achieve with the help of a high-quality PR firm that engages with your ethical stance. One of our Fellows, Ella Minty – co-chair of the Energy Leadership Platform – writes extensively about PR on LinkedIn. She’s well worth following. Ella makes a point in her latest post [4] about how PR firms may find a new line in social activism. PR firms would be such good allies in this field, because they know how to communicate and understand how to use the available channels to create maximum impact. If more and more PR firms turn their attention to social causes, they will form a hugely effective bedrock of support for other organisations to rely upon.”

For a range of further thoughts and insights on authenticity, check out these learning resources from the Institute

Source refs: [1] [2] [3] [4]

Image of Nike commercial partner Colin Kaepernick courtesy of DFree, via Shutterstock
 

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