Doing Good and Doing Well: How Can Sustainability Deliver ROI?

By Luc Speisser, Global Chief Innovation Officer at Landor & Fitch

Sustainability focuses on three pillars: social, environmental, and economic, also known informally as people, planet and profit. In the drive towards a more sustainable future, the importance of the last P – profit – is often forgotten by businesses. 

To comply with ever-growing pressure from consumers, regulators, governments and investors, many organisations globally are making pledges and rolling out new programmes and initiatives to lessen their impact on the planet. These actions are carving the path towards meaningful change, creating a more sustainable world. 

But what we’re seeing is the emergence of a green sea of sameness, where few commitments or initiatives from brands stand out. Most FMCGs are reducing their use of materials by 25%, most banks are committing to responsible investing, and all industries are pledging to reach Net Zero by 2050. While meeting compliance standards in this way helps brands prove their relevance to the sustainability cause, it fails to create difference. Without difference, sustainability is just a cost, and a substantial one at that.

Sustainability requires huge investment across supply chains, R&D, technology, innovation, communication, training, and more – and all the while generating little to no profit. However, there is a way to change this: to shift sustainability from a necessary cost to an activity that actively delivers return on investment (ROI), by using brand. Brand helps businesses to identify how to differentiate through sustainability while ensuring relevance and in doing so driving ROI, rather than focusing only on compliance and incurring cost in the same way everyone else is doing. This is where the true business value of sustainability lies. 

What brand-led sustainability looks like

Research shows sustainable brands grow faster than those perceived as having a lower positive impact. But brands need to do good in their own different and unique way to tap into what is estimated to be a $12 trillion opportunity.

A few businesses are already realising this. Born from Kickstarter in 2017, ACBC (Anything Can Be Changed) is an Italian shoe brand that’s promising to change the industry – and delivering through everything it does. The use of apples, grapes, and pineapples in place of leather makes its shoes unique. Still, the brand goes above and beyond fruit-based footwear by auditing manufacturers regularly to maintain confidence in its supply chain. ACBC even takes shoes you no longer want to wear (whether they are ACBC or indeed any other brand) and uses them to build playgrounds.

Start-ups stand at the center of sustainable growth. Nevertheless, they still need to innovate in order to develop and maintain their own unique take on sustainability. To: is an investment fund, born with an idea to support triple bottom line companies that operate for kindness and responsibility. To: is only tangible through the companies it invests in, and it makes a virtue of this by collecting unused materials from its clients – past-season catalogues, leftover posters, business cards, even condoms – and printing its own brand expression over them. By upcycling waste materials, To: simultaneously gives voice to its own ambition, and to all the responsible brands it partners with. 

In each of these examples, sustainability is at the heart of both the business and the brand, and in a meaningful, ownable and differentiated way.

Unlock business value through brand-led sustainability 

Whether your brand has already launched a range of sustainability initiatives or is just starting out, it’s important to take a rigorous approach to finding your singular and ownable point of difference. It’s also critical to evaluate and prioritise your activities to maximise returns on sustainable investments. We believe there are five key steps to doing this: 

1. Assess your brand’s current status

Brand equity exists across four pillars: differentiation, relevance, esteem and knowledge. Assessing your brand’s equity in these areas will help you to identify what you need to do to improve. It’s also a good idea to measure how well your brand associates with sustainability. Is it a leader, or does it lag behind? 

2. Consider the category

Sustainability has varying importance and impact in different sectors, including on the bottom line. Through the lens of the UN’s 17 Sustainable Development Goals, you can uncover the areas of sustainability that are most impactful within your category, as well as those that your brand can uniquely own. Brands must create positive change that goes beyond the environment and into other areas, like accessibility, too. We explored this on a recent Landor & Fitch webinar ‘Sustainable Packaging Unpacked’ with Wella Company, where we highlighted inspiring innovations from brands of all types and sizes, across the world.

3. Measure activity impact

Not all sustainable initiatives are born equal. Some will drive a sharper point of difference and greater financial returns than others. Potential can be assessed using future market modelling, revealing the most impactful initiatives today and in the future. This allows businesses to focus on the most profitable activities, and to build a business case for change. 

4. Optimise activity mix

It’s also important to calculate the right mix of sustainable initiatives to reach the right people in the most effective way. One activity may reach a large audience, but it may be more effective to continue or start a different initiative, programme or line extension that stretches credibility and business into new areas. Alternatively, creating a new sustainability platform can align a number of initiatives with the same goal in mind. Businesses need to know where to invest.

5. Boost employee engagement 

As well as external perceptions, it’s a good idea to measure how programmes can be used to effect positive behaviour change within a business. This can improve engagement, change behaviours and boost productivity to really foster a stronger, more united, working culture and of course: improve the bottom line.

Bringing the new sustainability strategy to life

Assessing and finding a brand’s sustainability focus requires an in-depth analytical approach. However, for a brand to stand up and stand out, it requires more than just analysis alone: it needs extraordinary creativity too. True brand transformation is only created with a combination of analytical rigour and creative excellence. 

Innovating for business, people and planet 

Sustainability is arguably humanity’s biggest innovation challenge, but it also represents the biggest opportunity for all businesses to do good and do well.

Sustainability is no longer a ‘nice to have’. However, while investing in sustainability is increasingly necessary to maintain relevance, the risk is that it fails to create difference. And without difference, return on investment is often limited, perhaps even nil. Through the lens of innovation, combining rigour and creativity, sustainability can become a competitive advantage. Building a Good Brand can be good not only for people and planet, but for the business itself.  

About the Author

Luc Speisser is Global Chief Innovation Officer at Landor & Fitch. He has 25 years of innovation, behavioral change, strategy and brand experience, leading numerous global branding programs for clients such as Airbus, Citroën, Danone, the European Commission, Fédération Internationale de Volleyball, Kellogg’s, LVMH, Procter & Gamble, SNCF, Total and Volkswagen Group.