With climate change identified as a leading issue in Australia’s recent federal election and 83 per cent of voters wanting more climate action, it comes as no surprise that retailers are feeling the pressure to make changes that meet new consumer values and demands.
According to research by Power Retail and The Purpose Agents, almost half of Australians (47.16 per cent) prefer shopping with retailers that are open about their sustainability practices and over 65 per cent of Australians believe that the retail industry creates too much waste, with one in three considering the product’s lifecycle and packaging before purchasing it.
“The goal of this spotlight is to inspire the retail industry to move further towards sustainable action and showcase the businesses that are doing their bit for people and our planet,” Anna Forster, co-founder of The Purpose Agents says.
“For retailers, investing in a sustainable and ethical business model will be a long-term win for business revenue. We know that customers are more likely to return to retailers that are transparent about ESG policies and with the carbon tax on the horizon, now is the time to get ahead of the curb.”
Here are four key areas that retailers must address and act upon in order to improve their environmental impact.
1 Reduce carbon emissions
About 90 per cent of total emissions from retailers come from product supply chains, production and processing of raw materials. Therefore, retailers must tackle their supply chains, gain transparency on all processes and work with their suppliers to reduce their overall carbon footprint.
2 Transparency and greenwashing
Retailers must be authentic and transparent about their sustainable policies and ethical practices to consumers, as false claims risk brand reputation damage. In a time when brand loyalty is low and choice is high, brands can’t afford to risk trust with consumers, especially when it comes to sustainability claims.
3 ESG is an investment in business growth
Many businesses still see an inherent trade-off between choosing a more sustainable future and business growth and profit.
Many see ESG-related spending as purely cost, not an investment. However, the data from the report shows that sustainable practices create long term value, minimises business risk, attracts customers and talent and most certainly reduces cost in the long term.
4 Investigate and set an ambitious goal
The sustainable retailer in 2022 is investigating and implementing ways to improve their impact. They are looking into their supply chain and collecting research from their consumers to hear what the most important environmental practices to them are.
As one in two Australians are more likely to return to a retailer with sustainable or ethical practices, this process of research is crucial to customer retention and business growth.
Founder of Go For Zero, Ellie Degraeve, says perfection isn’t the goal, change is. Transitioning from plastic to sustainable pens, for example. Or from bottled water to an under-sink purifier and glasses for your customers. Starting with something simple can create a ripple effect across your staff, workplace, customers and communities.
“While one change may not seem like much, it might just be the challenge you need to start your sustainable business journey,” she says.
Julie Mathers, founder of Flora & Fauna believes retailers are the ones to drive change.
“It’s what our customers want and it’s what our planet needs. At Flora and Fauna, the drive for sustainable change runs deep within the veins of our company, from the warehouse to the customer’s doorstep and even inside the office.
“We’ve set ambitious targets for our company to achieve before the end of 2024 including closing the loop of all our waste and making our warehouse operations completely plastic-free by 2024. This is what retailers need to and that change starts at the top with CEOs and business leaders to instil the importance of sustainability into their everyday practices.”
