After a hiatus of a year and then some, I am back to blogging. Major life changes and personal circumstances came in the way, and as things have steadied an enthusiasm and motivation to blog has returned.
A re-introduction: this blog is about sustainability. Specifically, case studies and examples of businesses improving their sustainability, and especially creating shared value! As best as I possibly can, I write articles that highlight the business case for sustainability. Where I can, I try to weave in some insights on how to get this going. Ultimately, this is all to hopefully encourage or inspire action for other businesses to follow suit. This is quite ambitious with such low readership! So I am also motivated by how it encourages me to keep up to date; learning and developing as a sustainability professional.
The topic that quickly attracted my attention this week was how the millennials market segment is influencing sustainability in more ways than you think. Specifically, in more ways than just employer branding and recruitment, products and marketing. I had noticed a few sustainability focused articles in the last week or two that touched on millennials, and thought this could be a good theme to explore further.
The generic notion that millennials care about sustainability and will push businesses towards corporate sustainability, is something I have been hearing talked about in its most abstract sense since around 2005. I always used to remember hearing messages along the lines of – “millennials are going to care more about sustainability, so you should think and act on that” – without really adding much substance to the vague advice. Maybe touching on customers and employees.
Recruitment and employer branding
The Deloitte Millennial Survey, which has been running since 2015, is the best reference on this topic. The primary finding that year was that millennials “want to work for businesses that focus on people and purpose, not just products and profits in the 21st century”. When the 2016 report came out I dissected it in detail; and the following quotes really struck me:
Millennials feel that most businesses have no ambition beyond profit, and there are distinct differences in what they believe the purpose of business should be and what they perceive it to currently be. Millennials often put their personal values ahead of organizational goals, and several have shunned assignments (and potential employers) that conflict with their beliefs (page 2).
Millennials judge the performance of a business on what it does and how it treats people. For example, among those saying business “means more than a healthy balance sheet,” more than six in ten would reference the quality of its products and services (63 percent) or levels of employee satisfaction (62 percent) (page 9).
Seven in ten (70 percent) Millennials believe their personal values are shared by the organizations they work for. This rises to 80 percent among the most senior Millennials and 82 percent for those intending to stay for at least another five years. This is a strong indication that Millennials choose employers whose values reflect their own—a concept reinforced by the finding that, globally, 56 percent of Millennials have “ruled out ever working for a particular organization because of its values or standard of conduct (page 11).
Products and marketing
As I had mentioned, a few articles in the last couple weeks showed that millennials and their interest in sustainability are driving major changes to food, alcohol, and cosmetic companies.
In late December, Triple Pundit came out with a detailed article on how millennials are driving changes in food purchasing preferences, products, and marketing. Interviewing Jolie Peters from Plan 3000, the article told the story of how millennials are behind a “food revolution” towards organic, fresh, locally sourced and plant-based. Indeed, I see this everywhere; my conversations with people, the styles of today’s hottest restaurants, and my own personal preferences.
Even places that represent the complete opposite of health, sustainability, and purpose – the fast food chain – are evolving. Carl’s Jr, the American burger chain, kicked off 2019 with the addition of plant-based burgers to its menu (Reuters). White Castle, a rival chain, did the same last November (CNBC).
Earlier this week, Business Green shared that one of Diageo’s major sustainability priorities will be promoting low-carbon activity. The full article was behind a paywall, but given the headline was “raising a glass to green Millennials”, one can easily assume that this was a lucrative market in which they felt the need to grow.
Also earlier this week in cosmetics, Environmental Leader put out a piece about Unilever expanding its Love Beauty & Planet line for the sustainable millennials market. Unilever believe that millennials want “purpose-led brands that make an impact,” a quote from Piyush Jain, Unilever general manager and VP of marketing for US hair care.
The problem with these developments, however, is that millennials are cynical. According to a study referenced in the Triple Pundit article, “millennials are twice as likely to distrust large food companies than older generations”.
New way #1: corporate acquisitions
Instead, the article suggests that one of the better tactics for the major food corporations is to acquire businesses already in this space, and let them do their own thing. The classic example being Unilever and Ben & Jerry’s, an approach it recently replicated with the acquisition of The Vegetarian Butcher in December.
New way #2: organisational structure
Acquiring a company to let it run itself is an unconventional organisational structure in its own right. But even without an acquisition, structures are changing. The above-mentioned update from Diageo was in the context of the appointment of a newly created position, its first ever Chief Sustainability Officer. Presumably, the company saw that sustainability needed a bigger seat at the table, and changed its structure as a result.
New way #3: investor relations
The above-referenced Unilever update was also covered in Glossy, which added a very important shared value aspect to the story – “since launching in December 2017, [the Love Beauty & Planet line] has repeatedly been called out in Unilever’s earnings for its success”. The company is specifically emphasising sustainability strategies in investor communications, because it knows investors love it.
All three examples are very much about creating shared value. Financially driven, socially driven, environmentally driven. The demand for sustainable products has been mainstreaming for a long time, and it seems like it is definitely here now. And it is influencing not only the obvious ones of employer and product branding, but also executive recruitment, corporate structure, and investor communications.