Sustainability and ethical corporate culture can increase brand value, study shows

To expand the value perceived by customers, brands should associate sustainable innovation in products and services with an ethical and responsible corporate culture. Users associate values such as an organization’s receptiveness to new ideas and privacy in the management of personal data with a commitment to social responsibility. This increases the positive response to brands’ environmental innovations, which do not achieve this effect in isolation. Therefore, companies should prioritize practices in line with the demand for data privacy and transparency in order to enrich the brand value perceived by consumers.

These are among the findings of a study carried out by FGV EAESP researcher Marcelo Gattermann Perin in collaboration with other scientists, published in the journal “Sustainability.” The authors investigated the role of consumers’ perceptions of environmental innovation and ethical aspects when it comes to brand value. To do this, they fielded an online questionnaire, which was filled out by 336 graduate students who consume products and services offered by Apple and Microsoft, companies with high added value.

The authors deem “environmental product innovation” to mean the care taken to minimize possible environmental damage in the innovation process, avoiding the use of toxic materials and prioritizing the efficient use of raw materials, for example. Perceived brand value refers to each customer’s subjective opinion of a brand’s offers and deliveries, which affects their purchasing decisions.

According to the study, consumers prefer companies that are concerned about protecting personal data and that are receptive to ideas about values and management factors. Practices such as adopting suggestions and solving problems indicated by users generate greater confidence in the reputation and image of organizations. Among other things, consumers prioritize measures such as storing appropriate levels of personal information, using it in a way that is consistent with each user’s authorization and avoiding selling data to third parties. The authors emphasize that developing ethical frameworks that balance the interests of the company and consumers enables organizations to more effectively achieve their goals and objectives.

As practical applications, the researchers suggest that managers adopt sustainable actions, associated with marketing campaigns, to demonstrate to the public that their company is open to listening. It is also important to incorporate consumers’ demands and feedback, as well as being more ethical in relation to data, by developing and executing information privacy policies based on fairness, transparency and responsibility. In addition, government representatives could offer incentives to companies that adopt such practices. In this way, companies can build trust among consumers and effectively gain a competitive advantage.

To read the full study, click here.