2021 was arguably the biggest year yet for many companies commitments to a more sustainable future. Whether it was due to increasing external or internal pressures, or to coincide with COP26, those who hadn't considered it prior were making big decisions and formal commitments that will help define their business going forward. Whilst there is still a long way to go for many businesses it is positive to see all the work so far, a lot of which we have already shared.
This has included the many more businesses that became B Corps, marking their stance towards people profit planet with the community growing by 27% in Europe. Kin & Carta are the first PLC to be certified as a B Corp on the London Stock Exchange and Coutts' certification joins the likes of Triodos Bank in trying reshape finance through purpose. Next year we could see one of our favourites, Patch Plants become certified, as well as ourselves, as we have just finalised and handed in our submission.
Market trends have also illustrated that conscious consumerism is on the rise, with ethical brands received a 300% rise in Google searches globally in 2020. What a brand stands for and how it does business, top to bottom, is now critical in determining where customers spend their money. Whilst there is still some hesitancy to spend extra money on these products, we thought it was worth resharing this post which sums up the need for financial reform to help increase accessibility to more sustainable products. https://www.nl.kearney.com/consumer-retail/article/?/a/why-todays-pricing-is-sabotaging-sustainability
So what are we expecting as we enter 2022?
As this years commitments turn into action we are likely to see more sustainable business models, product lines and resource usage across industries. We are seeing new companies emerging based around the triple bottom line and employing principles from increasingly adopted models such as circular economies. Backmarket is a great example of a new market place increasing the desirability and availability of refurbished products.
We are also likely to see tighter environmental regulation, starting off with the EPR regulation that will increase tax bills for companies who produce packaging that does not meet the recycling and reduction targets put in place from now until 2025. It will be interesting to see how companies respond to these regulations.
To date data has been a big focus for businesses trying to enhance and optimise their customer experience, and drive efficiencies across their supply chain and reduce costs of manufacturing. The very near future will see a balancing of the data and measures with business needing to collect data and measure on their impact across ESG measures, across people, planet as well as profit. This means data, measurement and reporting infrastructure of the 'age of digital' can be put to good use in what is shaping up to be the 'age of ethics', with businesses required to report on real action against their ESG goals rather than offering up commitments with little substance for short term gains over long term sustainable development.
With the global supply chain challenges witnessed throughout 2021 and bull whips experienced from both the Suez Canal blockage and COVID-19, we expect to see businesses embracing more diversified and local sourcing moving away from single market, single supplier structures. But also trying to increase their transparency and reduce their global footprints and reliance by working more locally.
On a grass roots level we believe this will be reflected from a consumer demand / pull perspective too. We will see more local community focussed trends, as local continues to thrive as a result of the pandemic. Remote working becoming more accepted and accommodated by organisations, so people are more distributed, as is spend. Added to this, digital acceleration has permanently changed the way we shop, what we consider to be convenience and what we value locally. We think the future of retail is set to be more human-centric than models of old, going beyond just shopping and offering service and utility, building value back for the local people and community and evolving to be much more societally and environmentally focussed in the process.
So as we reflect on the whirlwind year of 2021 we also start 2022 with excitement as companies take the reins in encouraging a more sustainable economy.
Image sources:
https://www.backmarket.co.uk/ https://growensemble.com/what-is-a-b-corp/ https://www.bbc.co.uk/news/world-middle-east-57746424 https://www.greensquare.co.uk/
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