As more brands go green, data shows consumers have become more sceptical

After pushing Australian businesses to consider environmental and social issues for over a decade with no apparent results, consumers now find it difficult to believe brands’ claims that they’re going green, according to a recent report by strategy firm Possible.The report, which was based on a survey of more than 2000 people, found 85 per cent of Australians are sceptical of the social and environmental claims being made by companies, and 80 per cent have been dubious for the past ten years.More than half of consumers can’t think of an organisation that has a ‘standout’ reputation on environmental issues, and, once customers experience greenwashing, they become more doubtful of all sustainable claims moving forward – even legitimate ones. According to Possible’s founder Andrew Baker, the recent collapse of plastic recycling firm RedCycle had a significant impact on Australians’ mentality toward green business, making it one of the “greatest environmental catastrophes of the last decade.”“Here you had a lot of families and households in that program, doing their bit, and what emerged as it unravelled was that the business had been doing the opposite of what it was saying,” Baker told Inside FMCG. The scale of that failure is likely to stick in consumers’ minds for some time, and could temper their willingness to play a role in the next scheme.In saying that, despite all of the concern about greenwashing and the cynicism consumers have about climate change, there’s still a big opportunity for brands to put nature first, Baker said. And it’s not just customers, but investors and regulators that are increasingly interested in what a business is doing to prepare itself for the future. It’s become clear that business practices will need to change, they argue, and so they want to see risk assessments and gain an understanding of a business’ exposure to environmental factors before investing.“Increasingly, large, fiduciary investors are asking businesses to explain these things,” Baker said.“It’ll start with a trickle, but the pressure will grow. Our counsel for retailers, manufacturers, and suppliers, is to get on the front foot with this now, and build the institutional muscle.”Getting on the front footBaker noted that many brands still see becoming sustainable as a cost to their regular operations, when in reality it should be thought of as a “hygiene” principle and an opportunity to innovate.“For example, Christian Dior has been concerned about the risk climate change has on its 42 flower gardens around the world that they use as ingredients for their fragrances,” Baker said. “To start to mitigate some of those risks, they’ve moved all 42 of these gardens to a regenerative model that will deliver better soil quality, and make them more resilient to fluctuating conditions. By taking that sort of approach, and communicating it within their branding, Christian Dior can add that sustainable factor to their claim to luxury – while also making their business more resilient.”Marketing sustainable claims isn’t as easy as it seems, however.Possible’s research showed that most Australians don’t relate to or understand terms such as circular economy, nature positive, or net zero, and that brands need to find ways to humanise their marketing messages. Rather than hiding behind such terminology, businesses should lay out what impact the product or service in question will have on the customer’s world, as well as the world at large.“The real task is to find ways to explain these concepts in terms that are relevant to people within the context of their everyday life, and to help them make informed purchases,” Baker said. Cost of livingWhile Australians across the country ranked cost-of-living as their chief concern, with environmental issues falling to tenth place, the reality isn’t as clear cut as that, Baker argued. “On the one hand, yes, immediate financial issues are a high priority for people – they’ve got to pay their mortgage, and put food on the table,” Baker said.“But that doesn’t mean there is a lessening of their concern on a range of environmental and sustainable issues. It just means that, in the here and now, there is a diminished capacity to pay a premium for those offers.“There’s always been a small proportion of the community who are willing to pay a premium for green offers, but what we don’t want to see is sustainability as an added cost. That’s the lazy approach. The more innovative approach is going to be finding an opportunity to find new ways to add value to a business, and new ways to engage with customers. “It really is a creativity challenge, rather than a cost challenge.”