New research from BT has uncovered a significant mis-match between the efforts being made by retailers to act sustainably, and the perceptions of consumers.
96 per cent of companies in the sector believe that operating sustainably is important to their reputation. However, only three per cent of customers think businesses are fully open and honest about their actions, with 33 percent believing they exaggerate what they are doing to become more sustainable in order to gain consumer favour.
Employees across the retail sector, displayed similar scepticism. The research found that nearly a third (31 per cent) of employees do not believe that the organisation that they work for is environmentally and socially responsible. One in three (30 per cent) believes that their employer only takes action when forced to by external pressures such as suppliers or customers. 39 per cent say their employer is currently doing too little in this area.
Yet despite consumer scepticism, retailers claim that they do recognise and are tackling the issue of sustainability. The report found that 56 per cent believe they are taking significant steps to improve their impact on the environment and communities and a further 28 per cent say they are doing everything they can.
The research suggests UK retail businesses have a lot of work to do to convince customers how seriously they take sustainability. A reputation for poor sustainability practices - whether justified or not - can impact on an organisations bottom line. said Laurie Bowen, Managing Director, Commercial & Brands, BT Global Services. For those retailers that are genuinely taking sustainability seriously, there are significant benefits to be had - in terms of reputation and marketability.
Many forward thinking names are making real progress for example working with suppliers to achieve best practice throughout their entire supply chain. However, to make sure this message is getting through businesses need to be more confident and transparent in their communications. Both employees and consumers need to be told about the good work being done, and businesses need to work hard to deliver hard evidence and ensure that the story they are telling is credible and convincing, she added.
The benefits of sustainable business are underlined by the finding that in the last year over a quarter of consumers (27 per cent) have turned down a product or service from a supplier they felt did not have a strong sustainability record. 60 per cent would be prepared to spend extra on a product that was more environmentally and socially responsible.
But whilst businesses acknowledge the benefits of adopting more sustainable working practices, they also point to significant challenges. The biggest of these is ensuring the necessary investment in new business processes and equipment (42 per cent); followed by senior management setting the standard (20 per cent); encouraging employees to adopt ways of working (20 per cent); and following through on promises (18 per cent).
When asked to name which industry respondents perceived to be the most sustainable, the results were as follows:
Utilities sector (24 per cent)
Public sector 19 per cent)
Retail (16 per cent)
Construction (eight per cent)
Transport (five per cent)
Media and leisure (five per cent)
Financial services (three per cent)
BT has long been an advocate of corporate social responsibility. It plays an active role supporting work undertaken by industry bodies including the CBI and the World Economic Forum and its CEO, Ben Verwaayen, leads the CBI's climate change task force. BT has successfully reduced its own carbon emissions by 60% since 1996 and has won numerous awards in recognition of its work in this area. In 2007 it was rated the world's top telecommunications company in the Dow Jones Sustainability Index for the seventh consecutive year The recent launch of BTs Carbon Impact Assessment methodolody will enable BT to share its learning on carbon reduction and provide retailers with an assessment of their IT related carbon footprint.
Additional findings include:
20 per cent of retailers are prepared to make significant additional investment in order to improve their sustainability record over the coming year. Half may make some additional investment.
94 per cent of retailers believe that they have a responsibility to consider the sustainability record of suppliers. When doing so, 44 per cent expect suppliers to meet a minimum standard.
92 per cent of retailers believe IT and communications technology has a role to play in improving sustainability. Yet almost half (44 per cent) have no plans or targets for achieving improvements.
Retailers believe that the main driver for UK companies to increase their levels of IT investment over the next five years will to help make a business more sustainable (34 per cent).