These campaigns, underscored by the entrenched belief that consumers respond to brands and not corporations, achieved considerable success despite revelations that questioned the social conscience of the organizations paying for their air-time.
In the case of Nike, for example, believers in the brand failed to relinquish their loyalty amidst allegations the organization produces the bulk of its products in developing countries notorious for exploiting workers. It seems, however, this history of success in pitching the brand exclusive of the corporate social machinations of the organization is about to change.
A recent study convened by the Richard Ivey Business School dubbed “Reward or Punish,” indicates there is a notable shift in the way consumers spend their money at the mall. The primary result of the research points to an increasing interest of consumers in rewarding companies with a reputation for exercising corporate social responsibility, and punishing those that fall short of taking their stakeholders into account when making fundamental decisions that magnify their ethics or lack thereof.
Evidently, people display willingness to pay a premium for products from companies famous for ethical social behaviour and express disregard for those with poor corporate citizenship by refusing to purchase what they produce, or decide against paying the asking price for these said products.
As green is fast becoming the new black and governments are now forced to recognize Kyoto and other global efforts that preach gentility to the earth, consumers are taking notes and applying this awareness at the cash register. In an attempt to avoid being priced out of the market, more corporations, particularly those with operations that directly affect the environment, are including a corporate responsibility report with their annual declarations of profits.
Perhaps the most compelling driving force for practicing corporate responsibility to date is ethical consumerism. Leveraging reputation and transparency, particularly in the court of consumers, is now commonly employed in times of crises and threats to the integrity of the organization. Corporations like Shell have used their philanthropy and environmental responsibility to define their triple bottom line reporting and achieved considerable mileage in molding consumer perception that helps to cushion and contain repercussions when inevitable mistakes are made.
In 2004, Shell was accused of “misreporting” its oil reserves. However, constant references made to Shell Foundation’s contribution to education and community development in the Flower Valley Project in South Africa, served as a strategic distraction and pronounced a quick death where the allegations were concerned.
No-one seems to remember what ENRON ever did to improve the community or make the world a better place. That is a lesson itself.
Raquel is a writer and PR/Communications Consultant in Toronto.