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Brandlogic and CRD Analytics Release 2012 Sustainability Leadership Report
October 18, 2012
The world’s top brands are making big strides in their sustainability performance but getting less credit for it from key stakeholders, according to a new report.
On Monday, Brandlogic and CRD Analytics released their second annual Sustainability Leadership Report, which comprehensively scores and compares real and perceived sustainability performance for 100 leading global brands that comprise 16 percent of gross world output. The organizations, with support from the Institute for Supply Management (ISM), created the report to help corporate managers measure their overall sustainability performance and chart a path to sustainability leadership. The full report is now available for free, and Brandlogic is scheduled to participate in a panel session on "Sustainable Brand Perception vs. Performance" as part of the Sustainable Brands London Conference next month.
In some ways, the findings from the 2012 Sustainability Leadership Report represent a big change since 2011. Last year, 66 of the 100 reporting brands had perception scores ahead of their reality scores. This year, 93 companies increased their year-over-year real performance scores, but 68 also experienced a decline in their perception scores.
“Sustainability carries tremendous weight when it comes to corporate reputation,” said James Cerruti, Brandlogic senior partner of strategy and research, and author of the report. “Even as real performance rose for almost all of the brands we analyzed, average perceived performance dropped off when compared to 2011.”
However, the 2012 study did reinforce last year’s conclusion that sustainability factors strongly influence overall perceptions and that social factors such as human rights, employment equality and product responsibility are twice as meaningful on perceptions as environmental or governance factors.
Brandlogic and CRD Analytics use a multifaceted methodology for comparing real vs. perceived sustainability performance. To obtain the perception data, Brandlogic conducted a global research study in the summer of 2012, which included 2,500 investors, supply chain managers, and graduating college and university students located in the US, UK, Germany, Japan, India and China. CRD Analytics’ SmartView™ 360 platform was used to generate the real performance data, using quantitative and qualitative data from 141 performance metrics tied to environmental, social and governance (ESG) factors.
The data are then brought together in the Brandlogic Sustainability IQ Matrix™, a visual framework plotting each of the 100 companies into quadrants of Challengers, Leaders, Laggards or Promoters, based on the intersection of their Sustainability Reality Scores (SRS) and Sustainability Perception Scores (SPS).
The Leaders category, characterized by companies effective at both demonstrating and communicating sustainability, saw 19 firms experience setbacks of more than five points from last year. On the positive side, six new Leaders moved from the Challengers category in 2012: AXA, Coca-Cola, Deutsche Bank, EADS (Airbus), General Electric and L’Oreal. Three other companies — Dell, John Deere and SAP — were also newcomers to the Leaders category. Those brands were among six added to the report in 2012, replacing companies that were retired for no longer meeting the study’s selection criteria.