Thursday, April 25, 2024

How consumers are now approaching ESG

When purchasing food, Australians are said not to be interested in abstract notions on climate and emissions. They are, instead, engaged by pragmatic, local, specific actions that food brands are taking to be better corporate citizens, according to new research.

The new study, ‘Food for thought: ESG and consumer behaviour in agriculture’, conducted by Porter Novelli Australia and Quantum Market Research, shows that the cost-of-living crisis has hardened Australians’ hearts to climate and sustainability, despite the constant ‘culture wars’ on these issues.

More than half (54%) of the surveyed Australians reported feeling no increasing pressure to purchase food produced more responsibly, and claims of progress on ‘net zero’ had almost no influence at all.

Porter Novelli CEO Rhys Ryan says that while ESG and other forms of corporate responsibility have helped drive more prosocial behaviour from brands over time, the increasing cost of more responsible business needs to be offset by efficiency gains and increased sales.

“It has been incredible to see multinational and Australian businesses step up in recent decades. Consumers now expect corporations to engage all stakeholders – not just shareholders,” he says.

“At the same time, responding to increasing pressure from employees, consumers and activists – and institutional capital – always comes with a cost, which marketers often hope to offset through increased sales as discerning consumers pay a premium for ‘purpose’.

“However, ESG, purpose and corporate responsibility became buzzwords almost immediately, bringing reactionary backlash. Faced with rising costs and culture wars, pragmatic Australians seem to pick and choose which ‘cause’ they will spend more on.”

The report shows significant differences across age demographics and gender in terms of who cares about what, and why.

Key findings

  • Pragmatic Aussies: When buying food, Australians are most concerned about animal welfare (47%), Australian-grown and processed food (45%), and fair pay for farmers (43%).
  • Squeaky wheels: Australians make contradictory choices on animal welfare, rejecting caged chickens (23%) but not farmed fish (5%) when asked which sectors concerned them most in terms of animal welfare. Surprisingly, pork (9%) and lamb (8%) fared almost as poorly.
  • Straya-first: Surveyed boomers were almost twice as likely to buy locally grown and processed food (60% vs 35%), and much more likely to want to buy from brands that pay farmers fairly (50% vs 35%)
  • Responsibility gap: Surveyed millennials (51%) cared much more about responsible agriculture than boomers (41%). This same gap existed between surveyed consumers from Queensland (40%) and NSW (50%).
  • Care gap: When asked why they think companies act on ESG, surveyed women tend to think it’s an effort to do the right thing (48 vs 41%), while surveyed men see it as response to shareholder/activist pressure (27 vs 21%).

This year’s results, and the results of previous studies from Porter Novelli and Quantum Market Research, are available here.

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