Over the last year or so most of the world has faced challenges arising from the global pandemic caused by COVID-19. Among other things, the pandemic has provided an opportunity for raising greater awareness around how companies address environmental and social challenges and has highlighted the importance of Environmental, Social and Governance (ESG) issues.
In honour of Earth Day April 2021 this blog takes a brief look at some of the basics of having a brand strategy with a focus on environmental impact.
One of the developments since the start of the global pandemic is an increased desire to see greater alignment of company goals and success metrics tied to a focus on long term environmental impact and public interest. Building a brand that is pro-sustainability is increasingly a key part of business strategy. For some companies this has always been at the core of the business. In such a case the company is continuing to maintain its eco-friendly and or sustainable focus. However for other companies some pivoting and rebranding may be needed.
In general, we are seeing more initiatives aimed at better environmental practices including efforts to reduce pollution and waste, carbon neutral efforts, recycling and upcycling and pledges to be more dedicated to sustainability among others. Earth Day April 2021 encourages companies and individuals to keep on this positive track with the theme of RESTORE OUR EARTH.
Interestingly the pandemic has provided brands an opportunity to move forward to instill sustainability throughout the company. In some cases the pandemic has provided an ability to step back and offer an opening for an environmental focus do-over.
According to GlobalWebIndex, 61% of consumers say they’re likely to switch to a brand that is more environmentally friendly than their current brand. Further 2 in 3 consumers think brands that make a public promise to be sustainable are more trustworthy. This is a key factor for long-term growth. A brand should be backed up by authentic goals, facts and actions. What should be avoided is ‘greenwashing’, a term I have recently started to hear more frequently. This refers to when a brand makes a promise to uphold environmental standards in a way that is misleading, ill founded or inflated. To not run afoul, it is critically important to understand the terminology, and know your own company facts and objectives. Ensure that your brand strategy aligns with the environmental goals of the company and be transparent. Your brand could suffer severe reputational risk if you cannot deliver on your environmental promise. Recall that Rome was not built in a day. Small steps can have meaningful impacts, may better match what your company can accomplish and thus be a better foundation for a stronger brand. The path forward will thus depend on the individual company, its goals and suitable branding approach.
Certain eco-friendly initiatives may be able to attract certifications if the necessary criteria are met. Depending on the industry and products at issues, having such certification can boost a company’s reputation and overall brand. As discussed in The 10 Most Environmentally Friendly & Sustainable Companies (2021) (growensemble.com), “It’s always important to have an understanding of what certifications mean, so you know how reliably they represent your values… B Corporation certification is considered the gold standard for better-for-the-world business practices. If you “see the B” on a company’s website or product, that means the company achieved an impressive minimum score on the B Impact Assessment, an assessment that is divided into five Impact Areas: Governance, Workers, Community, Environment, and Customers. The environmental area of the assessment is very stringent and thorough, and often, B Corp Certified companies provide an impact report that details their sustainability plan and implementation…All 1% for the Planet members pledge 1% of their total revenue to highly-vetted environmental nonprofit organizations…Companies that are Climate Neutral certified measure, reduce, and offset their carbon in order to neutralize their carbon footprint…” Certifications and membership such as these are generally globally recognized however some environmental certifications are more jurisdictionally based.
It is important to be aware that in Canada for environmental labels and claims, the Office of Consumer Affairs is a key source of information relating to things like sustainability, energy efficiency, forest products and food products. A further resource directed at environmental claims is also available. If your company is transitioning its focus it is vital to learn the labelling, regulatory and legal landscape at the outset and to stay onside throughout the transition process.
Additionally, understating certification marks as part of your branding strategy may be important for a company that seeks to obtain such recognition. A certification mark is a special mark used to identify goods and services that are defined in respect of certain standards. The owner of the certification mark is responsible for establishing the defined standards associated with the mark. The certification mark can be registered with the Canadian Trademarks Office. Importantly the Trademarks Act establishes a licensing scheme such that the owner of the certification mark may license the mark to others for use on their own goods and services but the owner itself does not manufacture, sell, lease or hire the goods or perform the services in association with the certification mark. A licensee’s use accrues to the owner. It may be said that the owner of a certification mark is like a gatekeeper in ensuring a licensee properly uses the certification mark and by preventing an unauthorized person from using it or using it incorrectly. The Trademarks Act also regulates who can own a certification mark. Although certification exist in the environmental space, certification marks are not limited to the environmental arena. Examples of environmental focused certification marks registered in Canada include ENERGY STAR & DESIGN, FAIR TRADE CERTIFIED & DESIGN, GREEN ADVANTAGE, GREEN KEY ECO-RATING PROGRAM, NON GMO PROJECT VERIFIED & DESIGN. When you see a company using one of these marks on its good or services, or any other certification mark directed to the environment, it is a signal that the company has met the standard required by the certification mark owner. Having a license to use such a certification mark bolsters consumer confidence in your brand and elevates brand power.
Although the pandemic has brought a renewed focus to environmental impact issues it is unlikely that public interest of a company’s environmental goals will wane as we move into the new normal.
In general, developing and maintaining a strong brand in the environmental space is a positive business strategy but it can be a daunting area to navigate, especially if your company is newly focused on environmental issues or is stepping up its efforts. Working with legal counsel on branding (including the particulars of the certification regime), regulatory, risk and transition issues can facilitate the path forward.