Deloitte Whitepaper: The "Sustainability" Difference between China and the West from Consumers' Perspective

After China's official announcement of its peak carbon and carbon neutrality goals in 2020, sustainability concepts are flourishing, attracting wide attention from all sectors of society. Sustainability concepts will profoundly impact all industries in China, particularly the consumer market. China is now the world's second largest consumer goods market and is expected to take the United States' first place over the next few years.

Combining Deloitte Global’s research experience on consumer sustainability preferences with insights on the actual situation in the Chinese consumer goods market, Deloitte China surveyed Chinese consumers in 2023 and now releases “The "Sustainability" Difference between China and the West from Consumers' Perspective” whitepaper, including comprehensive analysis of consumer preferences around sustainability concepts to help international and local brands better understand Chinese consumers and inspire them to attain their sustainability goals while gaining popularity.

Key Finding 1: Chinese and Western consumers are at different stages of sustainability

With increasing publicity and education on sustainable consumption, more Chinese consumers understand and accept sustainability concepts. However, their understanding of the concept is confined to environmental sustainability, whereas Western consumers tend to also incorporate social and governance factors into their thinking.

Key Finding 2: Chinese and Western consumers have different concerns about sustainable behaviour

Chinese and Western consumers agree that reducing waste and recycling items are necessary. As a result, Chinese and UK consumers prioritize the sustainability practices of "reducing food waste" and "reducing single use plastics". The difference is that UK consumers attach great importance to recycling domestic waste, whereas their Chinese counterparts are more concerned about green and low carbon mobility, including reducing travel by private cars and air travel and adopting shared mobility.

Key Finding 3: Chinese and Western consumers share the same views on the attributes of a sustainable product

For both Chinese and Western consumers, the practical benefits of a sustainable product, such as good durability and ease of repair, are critical factors affecting decision making. Research data shows that in China and the West, consumers value durability and repairability when considering a purchase because replacing items less often enables cost-effective consumption and a sustainable lifestyle.

Key Finding 4: Chinese and Western consumers have similar pain points when it comes to paying for "sustainability"

The higher cost of sustainable consumption is a common pain point for Chinese and Western consumers Also, uncertain economic prospects undermine people’s willingness to consume, making them more conservative in purchasing sustainable products, which is a distinct reason for UK consumers to not adopt a more sustainable lifestyle. In addition to this cost issue, Chinese consumers mentioned that having limited access to information impacts their sustainable consumption.

Chinese consumers' understanding of sustainability values

Chinese consumers of all ages care about saving resources and reducing waste. However, as they have grown up in different eras and obtain information in disparate ways, their core sustainable consumption values vary:

• Influenced by traditional culture and education, Gen X^* and Gen Y^* consumers tend to act based on rational analysis and judgment. They are more concerned about the core values of environmental and ecological conservation.
• For Gen Z^*, advanced network technologies have given rise to social media platforms where they can access personalized topics and express their opinions, making them open to new things and place a higher value on personal experiences in sustainable consumption.
  

*Gen X: persons born between 1965 and 1980; Gen Y: persons born between 1981 and 1996; Gen Z: persons born between 1997 and 2012

Detailed sustainability case studies of consumer goods companies can be found in the full whitepaper

The “Deloitte Sustainable Value Map” - Insights for consumer brands

Companies' ultimate goal is to transform the implementation of sustainability concepts and ESG standards into corporate values, rather than treating sustainability as a mandatory cost item for corporate compliance. To help them achieve this goal, Deloitte has designed a new enterprise value evaluation system incorporating sustainable values. The “Deloitte Sustainable Value Map has four parts: (1) shareholder value, (2) employee value, (3) customer/social/public value, and (4) environmental value.

Based on the Deloitte Sustainable Value Map, enterprises can observe how each stakeholder perceives value creation by using baseline ROI frameworks, further understanding potential resource and impact flows across stakeholder groups, and considering how their value systems work today and should work in future to accelerate progress on multi-stakeholder value creation.

During global sustainability reform, multinational and emerging domestic consumer goods companies should grasp sustainability drivers. As sustainability concepts take deeper root in people’s minds, consumer goods companies that move first in establishing sustainable strategic layouts for supply chains, products, and marketing will embrace more market opportunities.