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Societal impact and purpose
Unlocking value for FMCGs and food retailers
Plastics. Climate change. Health and wellness. Ethical sourcing. Human Rights. The list of societal challenges continues to mount daily. Australian business leaders agree that they have a significant role to play in addressing these challenges…and they are taking action. However, more than half of consumer products leaders do not believe that societal impact initiatives have a positive impact on profitability. This lack of confidence in a return is placing future societal impact investment at risk, right at the time when it is needed most.
To ensure the pace and depth of investment in societal impact initiatives continues, we have to reframe the challenge, and unlock the value. Return does exist – from brand preference and ‘premiumisation’, to lower cost of talent attraction and retention, through to access and lower cost of capital. It can be more than a cost of doing business.
For business and society to win however, the consumer has to win first. Through their everyday purchasing decisions, consumers hold much of the value. To unlock the value, consumers will have to care about societal impact initiatives and act upon it as the key driver of choice. Brands have the opportunity to take a leadership position and shape public opinion on societal issues, by seeking to create a connection between societal challenges and consumer purchases.
This paper seeks to build confidence in a return on societal impact investment. It aims to empower brands to lead the change on societal impacts and provides strategies for organisations to unlock the value through consumers. Furthermore, it encourages brands to work closely with the retailer and others in their ecosystem to protect or amplify the value of societal impact initiatives.
- One in four Australian business leaders rank having a positive societal impact as the most important success measure in evaluating annual performance (Deloitte Forbes Insight survey).
- 51% of Consumer Product leaders don’t believe that investments in societal impact initiatives has a positive impact on their profitability, placing future investment at risk (Deloitte Forbes Insight survey).
- Brands have the opportunity to take a leadership position and shape public opinion on societal issues, become the brand of choice and realise a premium value.
- There are four sources of return for societal impact investments: people, banks, partners, and consumers. Consumers with their everyday purchasing decision could deliver the greatest return.
- Emerging technologies such as smart packaging, voice enabled storytelling and AI-driven personalisation have the potential to change the game for societal impact engagements.
Published: May 2019