ESG has been a hot button topic in recent years. Some call it the green wave, yet some others might even call it a trend. These terms suggest a passing fad – something that suggest sustainability as a temporary state. But is it really just a wave? Is it another sparkly new bandwagon to hop into? What is the current state of sustainability in Asia, specifically in Singapore? How does this affect brands and us marketers? Should brands care about their reputation with regards to sustainability? So, grab your green tea (or green coffee anyone? – no judgment here), and let’s set sail to explore whether is ESG is just wave or here to stay.

The state of sustainability in Asia

The diverse mix of cultures in Asia has resulted in Asian countries tackling sustainability by implementing policies that complement their local needs and priorities. These various approaches does not necessarily a right or wrong way to approaching sustainability. Rather, it shows the influence of each country’s unique circumstances, challenges and resources. Despite the ambition and hopefulness of these policies, their actual effectiveness and ultimately impact to the environment still remains to be seen.

Among the Asian countries, we are starting to see emerging leaders in ESG. Some countries adapting a more generalist approach while some others have chosen specific directions. For instance, China has made strides in clean energy investments and deployment of renewable energy technologies such as wind and solar power. South Korea on the other hand, focuses on energy efficient smart grids while Japan has been flexing its innovation in creating energy efficient technologies. But what about Singapore?

The little GREEN dot

The little Red Dot of Asia is turning green. Singapore is not just a financial hub; it’s rapidly repositioning itself as THE beacon of sustainability not just in Southeast Asia but in the whole of Asia. Singapore has shown leadership in urban sustainability using smart technologies to optimise energy use, manage waste and optimise public transportation. Green buildings have also been an emphasis – with the Building and Construction Authority recognising that 20% of the urban island state’s carbon emissions comes from buildings.

With the unveiling of the Singapore Green Plan 2030, the nation has set ambitious targets to reduce carbon emissions, increase renewable energy use, and promote a circular economy. This national push for sustainability presents both challenges and opportunities for businesses. On one hand, companies must now adhere to and navigate stricter regulatory requirements. On the other hand, there is a growing consumer demand for sustainable options. The government recognises this and are supporting businesses making ESG changes. This offers a golden opportunity for brands to not only appeal to consumer demands but also receive support to do so.

It’s not easy being green

Bain and Company has identified what’s been dubbed the “Say and Do” gap. This illustrates the gap between what people say about patronising (and paying for) brands and products that have a positive environmental impact versus what they are actually buying. And what they found out are people’s actions don’t always reflect the sentiment. In China, 54% of consumers rank sustainability as a top five key purchasing criteria. Yet, sustainable products comprise of only 12% of market share in packaged food. In Vietnam, the gap is 41% to a meager 3%. How about in Singapore?

Compared to fast growth Asia Pacific markets, Singapore’s gap is 23% to 14%. While still faring better in comparison, what really hinders consumers in Singapore, and the rest of the world for that matter? The culprit seemingly lies in obstacles that lie before the purchase. Information about how eco-friendly brands or products are potentially conflicting. This could potentially lead to erosion of brand reputation. Leading to skepticism amongst consumers who have either have no single verifiable source of truth or even a very basic level of what truly is sustainable. And consumers expect and governments to lead this change.

What does this mean for brands?

If you’re no stranger to antics (welcome back!), then you’d know the premium we place in storytelling especially in marketing. While brands face a tough balancing act when investing in sustainability, all those efforts should not go to waste. Studies have shown us that consumers are lacking for credible, transparent information on sustainability – so why not give them that? Not only does that advance brands’ ESG creds, but also fosters trust and nurtures a positive brand image. It also helps to position your brand as a leader in sustainability, in a meaningful and impactful way – ultimately giving you a leg-up on your competitors.

Additionally, being upfront and transparent about your brand’s sustainability mission and efforts also enhances your brand reputation. Attracting (the right) responsible consumers, stakeholders, investors and employees to join and support you on your journey. This makes incorporating sustainability efforts into your brand reputation strategy an important consideration.

Putting the G in ESG

Brands should also place an often neglected part of ESG. The “G”. This means care and effort should also be placed in navigating the ESG reporting landscape. ESG reports must be another metric to track when brands monitor their reputation and brand health. With the right tools, consultation and support, brands can ensure compliance, showcase sustainability achievements and even become eligible for Singapore government grants!

Staying ahead and navigating the seas of ESG doesn’t have to be a daunting task. To start, brands can conduct gap assessments to identify areas in their business that need improvement and standardise data collection to track their carbon footprint. Brands should also involve stakeholders in the reporting process. This involves the cooperation of both top management and front liners to reconcile business goals and directions with actual operations. Finally, let’s not forget about technology and how brands can leverage advanced data platforms to consolidate information to derive business insights from.

Sustainability “Action and perception” gap

While we see the gap in what consumers say and what they actually do, brands who have taken measurable steps in their journey should also consider what I like to call the “Action and perception” gap. This involves comparing a brands efforts in sustainability versus how sustainable consumers perceive the brand to be. We’ve already talked about how consumers may be lacking in education and information on how sustainable a brand really is. As marketers and brand communicators, we should then look at information and communication gaps our brand’s consumers may be having regarding our brand’s ESG efforts.

Once those gaps identified, we should then incorporate those into our marketing and communications plans. Taking the opportunity to create awareness of our brand’s sustainability efforts into advertising, PR and of course social media. Another tip? Incorporating data from the brand’s ESG reporting adds another level of credibility. Showing cold hard numbers helps avoid the perception of greenwashing and assures your consumers that your brand is legit (and not sus!).

Whats on the ESG horizon for your brand

While this journey may be an ambitious one, it is nonetheless a very meaningful and rewarding one. A famous grey wizard from Middle Earth said, “The greatest adventure is what lies ahead.”, and as creatives and marketers, we should all be excited to see what stories we can tell that can not only grow brands, but preserve our environment. The table stakes are set and consideration for ESG should be firmly entrenched in brand strategies because it will be another aspect brands will be judged on by consumers. Brands should be looking long and hard at the impact they are making not only to their consumers and bottom line, but to the environment as well. The good news? Brands shouldn’t have to set out on this journey alone. Ready to take that step? Let’s chat!