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The Walk-Talk Ratio and how to capitalise on CSR

Accusations of ‘greenwash’ abound, and the media is constantly criticising corporate brands for not living up to their green publicity.

In an attempt to sort the deep green from the green-tinged, brand consultancy firm Brandlogic and leading sustainability analyst firm CRD Analytics collaborated to produce a report identifying the gaps between what firms appear to do, and what they actually deliver.

The report, the first of an annual endeavor, offers a way to quantify and rank firms’ performance against public perception of them. It is intended to benefit firms themselves but is also likely to provide a guide for consumers and independent Corporate Social Responsibility (CSR) commentators.

The companies’ actual sustainability performance was plotted against corporate sustainability perception score of 100 high-profile global firms, the latter based on the opinions of three ‘highly CSR-attentive’ groups: graduates, investors and supply chain managers.

Dubbed the ‘walk-talk ratio’, the single score produced for each company may prove the new key metric in measuring the effect of CSR and its impact on marketing.

The authors divided companies into four groups – ‘Promoters’, ‘Laggards’, ‘Leaders’ and ‘Challengers’.

Laggards and Promoters: misbehaving or misguided?

Companies with below-average sustainability performance but good public perception of their performance were dubbed ‘Promoters’. Firms in this category include Walt Disney and Apple. The report authors warn that these companies face a huge risk that the capital they currently enjoy from their reputation may shrink dramatically and suddenly if gaps between their CSR behaviour and how the public views them are neglected.

Firms that have poor sustainability performance and poor sustainability perception were termed ‘Laggards’.  Companies listed in this category included several consumer discretionary and IT firms including McDonalds, Adidas and Xerox. Unsurprisingly the report recommends that these firms both up their sustainability game and start shouting about it.

Leaders cash-in while Challengers miss-out

‘Leaders’, i.e. those firms with above average sustainability performance and perception, included Nike, VW, and 8 out of the 9 pharmaceutical firms covered.  These companies are truly walking their talk – and getting the reputational benefits to match.

Finally, the ‘Challenger’ group is painted as corporate martyrs, with firms’ sustainability credentials being overlooked. The inclusion of BP in this group may raise eyebrows (and questions about what the 175 metrics are on which the sustainability performance is measured).  Other companies in this category include Roche, Citi, British Telecom and BHP Billington.

The majority of commercial and investment banking firms surveyed also fell into the ‘Challenger’ category. This mirrors the results of a recent Carbon Retirement report into offsetting in the FTSE 100, which revealed that financial firms were also leading the way in emissions reductions – 61% of them engage in some form of offsetting – but not necessarily communicating their sustainability measures well.

Mind the gap

Any quantification of something as nebulous as sustainability performance and its impact on brand perception is likely to be welcomed by the industry…or at least those who are ‘getting it right’.

For the others, report author Michael Muyot, president of CRD Analytics, aptly states, “the bigger question has less to do with where they are and more about what they’ll do to narrow the gap.”

It remains to be seen which gaps are easier to plug: bringing perception in line with reality or bringing reality into line with perception. We suspect the former, and hope that the Laggards see things the same way – if not the calls of ‘greenwash’ and public suspicion of green claims are unlikely to go away any time soon.


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