With the world gathering in Morocco this week for the historic COP22 meeting, the pressing issue of global climate change is fully front and centre. Leading the conversation on many fronts are the world’s top brands who are driving significant change in terms of the environment and other important sustainability business practices.
The Drum teamed up with leading global B2B marketing agency Gyro to survey more than 200 marketers on current attitudes towards sustainability within top business-to-business (B2B) brands. At the same time, The Drum and Gyro have worked to identify and recognise best practices in sustainability with the creation of the first ‘Sustainable B2B Brand of the Year’ award.
Vodafone received the honour last week at The Marketing Can Change the World Awards, part of Do It Day. Vodafone was selected, via a reader poll, because of the many impactful measures it has taken to ensure sustainability is at the forefront of its efforts.
The company is making significant progress in two areas of sustainability: transparency and three global transformation goals (energy innovation, women’s empowerment, and youth skills and jobs). One of the key targets of Vodafone in the UK is to engage 75% of its employees with environmental issues by April 2020.
Annette Fergusson, head of sustainable business at Vodafone Group, tells The Drum: “We use a lot of power which is linked to greenhouse gas emissions, obviously. We are aiming to improve our energy efficiency and reduce carbon impact over the next 10 years.” As Fergusson points out, Vodafone needs to be more energy conscious, serving 462 million mobile customers across the world.
It is also making great strides in the area of women’s empowerment. Internally, Fergusson would like to see Vodafone as “the best employer for women in the world.”
Externally, it is working to provide phones for women in emerging markets: “You put a mobile phone in the hand of a woman in a low-income economy and you can really impact her life. So we have an aspiration to bring mobile to 50 million more women in some of these emerging markets where there is currently a gender gap in phone ownership between men and women.”
What makes Vodafone stand out among its peers is its alignment between business and sustainability – an ability to derive both maximum social and economic benefits from doing the right thing.
Because Vodafone’s key strengths are in digital networks and services, the company has the power to address some “really significant societal changes,” says Fergusson. The company aims for “even closer alignment” between the core commercial goals of its business and the maximum social and economic benefits that are achievable as a “consequence of these goals.”
Marketers role in driving sustainability
But how does the interplay between the c-suite and marketing departments work at Vodafone in handling sustainability agendas? Are there particular departments responsible for taking the lead on environmental issues?
Fergusson says it depends on the particular program that is owned by a part of the business that can drive and make it happen at scale – HR could run it, along with the commercial or the technology department. For instance, she says the vast majority of Vodafone’s energy use is through networks that are ‘run and managed’ by Vodafone’s technology functions: “It's not this old-style CSR sustainability - it’s those core functions that really need to drive those programs.”
One of the biggest hurdles companies face in driving sustainability is proving the bottom line. In the past, the word ‘sustainability’ used to be associated with doing something extra on the side for the community good. But in recent years, this attitude has changed as more companies are seeing the advantages of embedding sustainability deep into every aspect of their business. The Drum’s own research finds that marketers feel that investing in sustainability leads to an overall better perception of their brand and long-term financial gains.
On involving employees in sustainability
The research findings from the upcoming sustainability report has found that employees have the impression they care more about sustainability issues than their employers.
Patrick O’Hara, global chief strategy officer at Gyro, believes that B2B brands must pay attention to the values of both its workforce and its customers alike: “Millennials are 'buying-in' and want to work for companies that share the same values as they do and want to feel a purpose when they go to work.”
In terms of which B2B companies to do business with, the majority of executives (60%) say knowing what a company stands for is the most important factor, according to research Gyro conducted with the Fortune Knowledge Group. The report, entitled 'Beyond the Brand: Why Business Decision Makers Buy Into Strong Cultures,' also found that 81% of executives say companies that succeed at long-term business partnerships make a direct correlation between what they believe and the way they conduct their business.
“B2B decisions are among the most complex and the most emotional. Business decision makers want to partner with a company that they feel good about, that they believe in,” says O’Hara. “That’s why a company’s values and actions are more important than ever before when it comes to attracting and retaining customers as well as talent.”
Although it’s still ‘early days’ and the strategy was only formulated last year, Fergusson and all of Vodafone clearly see the commercial benefits to be gained as they have the “potential to generate revenue” for Vodafone and “increase loyalty, improve efficiencies and drive down costs.”
Collaborating with the competition
Vodafone is not shy about teaming up with competitors to work on environmental issues, although Fergusson admits the partnerships are not on “competitive issues” but ones that “affect our whole sector.”
“As an industry, we all use very similar suppliers and we all have very similar standards we expect from them like working conditions and health and safety, etc. We work with some of our peers to audit where some of the equipment we buy comes from.
"And that's good for everybody. It means they are getting a consistent message from customers, labour standards and that the supplier is not getting audited week on week from a different customer. So it drives that standard by taking that collaborative approach within the industry.”
On the flip side, what are the challenges of such an initiative?
Fergusson says, “You can have amazing ideas, but actually, if you can't drive them at real scale...with strategy we try to take a different approach and bring that in.”
The full report, ‘The Drum Market Insight Report: Sustainability in B2B Marketing,’ produced in conjunction with Gyro, will be available to download soon.