Is Sustainability Just a PR Stunt?
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Any announcement made by top businesses these days will mention sustainability and possibly DEI. These are two very hot issues in corporate America, and companies will be scrutinized if they don’t do enough to make their company more inclusive and responsible. This is because companies are now more focused on their CSR, and ESG .. These terms are not well-known, so let me briefly explain them.
What is CSR (Corporate social Responsibility)?
*CSR refers to how companies have an impact on society. This can include the economy, environment, and people. CSR-focused companies will do more for their communities and hold themselves accountable to their stakeholders as well as the public.
What’s ESG (Environmental, Social and Governance?
ESG is a set standards that assess a company’s impact on the following three areas:
Environmental: sustainability practices and direct environmental impact
Social: relationships with their community, employees and customers
Governance: leadership, shareholder rights and internal controls.
What’s the difference in CSR and ESG, you ask?
While there are some similarities between the two, they have very different goals. CSR is a business model that companies can use to make a positive impact on society and the environment. It is self-regulated but allows them to implement it. Many companies include a CSR model as it can increase employee morale, attract better talent and improve the company’s brand overall.
ESG refers to a set or standards by which a company is evaluated. It is a predetermined set. Investors use it to assess how socially conscious a company, and to screen out risky investments.
Benefits to sustainability in business
So, sustainability in business usually refers to implementing the CSR model in order to improve your ESG!
are some examples of sustainability in business.
Improving energy efficiency by using renewable energy sources and reducing usage
Ensuring your business is climate-positive by offsetting carbon and planting trees
Encouraging sustainable behavior amongst all staff
The benefits to the environment are obvious. Companies that adopt sustainable practices may feel great about helping the environment. There are many reasons companies are focusing on sustainability in business. Here are just a few:
Talent is so difficult to come by at the moment, and companies who are seen to be “greener” have an edge as employees prefer to work with companies who are more socially responsible.
Being known as a sustainable and socially responsible company is generally good for your brand reputation overall, not just with talent. This will help you stand out from your competitors, and also attract more customers.
You become more attractive to investors, and open up more financial possibilities.
Is sustainability just a marketing trend or a marketing strategy?
With all the above benefits, it’s not surprising that companies want to be sustainable and caring about society and the environment. But is this PR? Do they actually care? How can you find out what’s really happening behind closed doors? Companies are spending so much time looking as though they’re doing a lot for the environment rather than actually making a difference that it’s been given a name — greenwashing.
Big companies were caught making bold claims about “green” to keep up with their competitors. Thankfully, some countries are cracking down on these claims, and companies such as H&M are being investigated and made an example out of.
Unfortunately this issue reaches down to even small businesses. Some feel even more pressure than others to stand out from their largest competitors. This is why the Greens Claim Code was introduced, warning even the smallest companies.
If you scroll down LinkedIn, you’ll see many businesses announcing that they are planting X number of trees and that part of their profits will go to great causes. This is a way for the world to know what good they are doing. They’re still powering hundreds of computers at their offices and flying private jets around the globe. These companies are well aware of the PR benefits of seeming like they’re a sustainable business, but are running the company another way.
How can you tell if a company’s greenwashing is evident?
You can tell if a company is greenwashing by their vague language and consistent release of press articles praising their great work, but not doing any actual work to support these claims. For example, BP spent millions on an ad campaign featuring renewable energy, but everything else the company was doing was bad!
Companies that use a lot jargon or talk scientifically are often doing so to confuse their audience and make it seem like they’re doing complex work. These companies are often not transparent and conceal key information, which is a sign that greenwashing may be in play.
If you are truly interested in a company’s ESG status and its owners, then do some research and look up their owners. You can use your own data to evaluate their claims, but you should take their press releases with a grain of salt.
The author of 5 books, 3 of which are New York Times bestsellers. I’ve been published in more than 100 newspapers and magazines and am a frequent commentator on NPR.