Ethical Values Can Drive Growth for Consumer Goods Companies Worldwide – IGD
Shopper research conducted by IGD in four main European grocery markets (Great Britain, France, Germany and Spain) found that at least 30% of people mention ethical values as one of the reasons to try something new for the first time.
24 Jun 2010 --- Delivering the opening speech at the Consumer Goods Forum Global Summit in London, Joanne Denney-Finch, chief executive, IGD, outlined the commercial reasons for focusing on ethical products and business practice as drivers of growth.
Speaking to more than 1000 senior directors, chief executives and chairmen, Joanne said: “Over a trillion dollars of food is traded between countries each year. We draw on a big share of the world’s resources, including 70% of fresh water. We shape the landscape, and diet has a big influence on human health and vitality. So we’re the world’s most important industry and society is asking more and more of us. We need new and sustainable strategies for growth.”
Shopper research conducted by IGD in four main European grocery markets (Great Britain, France, Germany and Spain) found that at least 30% of people mention ethical values as one of the reasons to try something new for the first time.
Joanne continued: “Ethical values offer us a big opportunity to build trust and customer loyalty, to energise our employees and revitalise growth. Shoppers are including ethical judgements more in their shopping decisions, but they don’t want to pay a lot more – they want value for their values. We asked them to look two years ahead and predict where they’ll be spending more. In all four countries, shoppers expect to be spending more on all the ethical areas we asked about. They want to make a bigger difference through their shopping choices and they want companies to help.”
Joanne outlined a number of examples of FMCG manufacturers and retailers raising ethical standards by, for example, backing Fairtrade, setting up international standards around sustainable sourcing, supporting social enterprises, cutting salt and saturated fat content, and conserving water. She called on food and grocery manufacturers and retailers to continue to ‘do the right thing’ both for shareholders and for society:
“Be focused. Choose a small number of things that you want to be famous for, and make sure they are things you really believe in and where you can make a big difference. Find them in the heart and soul of your company. Don’t expect a quick and direct financial return, but over time the benefits will accumulate.
“You’ll have new points of difference, your shoppers will be more loyal, you’ll be warmly welcomed when you enter new markets, and your employees will be highly motivated. You’ll find it easier to recruit new high calibre people and by helping economies to grow in developing countries, you’re investing in demand for the future.”
