Infine is currently hosting the third annual Finland’s Most Sustainable -competition, with results to be announced at the end of this month.
The public vote is open until 26th November 2024. You can check out over 170 competing products from more than 80 companies at ostavastuullisesti.fi.
In addition to the public vote, winners will be selected by Finland’s leading sustainability experts, forming our Sustainability Panel. This includes Professor Minna Halme, Professor Jyri Seppälä, Project Director Markus Terho, PhD Candidate Antti Majava, and Professor Mikko Mönkkönen. The process itself is invaluable: discussions among the panel and the examination of sustainability analyses help deepen our understanding of product sustainability, which is still an emerging research area. The public vote also provides concrete insights into how consumers perceive sustainable products.
Above all, this competition sparks dialogue and forms a crucial part of the broader conversation around promoting sustainable production and consumption. The goal is to highlight responsibly produced products, especially in a time when, for example, climate efforts in the US may increasingly rely on the private sector. The future will be shaped more and more by consumers – though, of course, consumers can only buy what companies offer. A familiar sentiment, but one that still holds hope for me.
Let’s get the word out – please share on social media to encourage more people to vote on ostavastuullisesti.fi. If you need materials or content, feel free to contact me.
Changes in Marketing, Repair Services, and Environmental Impact Management of Products' Lifecycles
On the consumer side, here’s a brief summary of the regulatory environment. EU legislation aims to give consumers the opportunity to make responsible purchases, with key directives such as:
- Green Claims and Empowering Consumers for the Green Transition Directives: These set rules for environmental claims, requiring companies to ensure that their environmental impact claims are verifiable and based on transparent data. The goal is to rebuild consumer trust in green claims.
- Repair Directive: This promotes the repairability and longevity of products, reducing waste and resource consumption. It enshrines the consumer’s right to request repairs after the warranty period and obliges manufacturers to provide spare parts and repair services.
- Eco-Design Regulation: This extends environmental requirements to cover more products, ensuring a reduction in environmental impact throughout the product’s lifecycle. Criteria include energy efficiency, durability, repairability, and recyclability, improving consumer choice in sustainable products and reducing the need for rapid replacements.
Many of us wonder if all these Green Deal directives will be implemented as they stand, or if they’ll be watered down along the way. I’ve discussed this with many experts, and I believe at least some softening is likely for those directives still under review. My hope is that these adjustments are made in a sensible way to streamline implementation, rather than purely for political reasons.
When considering the consequences, remember the upheaval GDPR caused with “only” a 2% revenue penalty – now, we’re looking at a starting point of 4% for non-compliance with Green Claims, for example. So, even in a slightly softened form, these regulations will require substantial work. However, they also present a significant opportunity to mitigate external disruptions, which benefits us all, regardless of political stance.
Sustainability Creates Added Value
Sustainability doesn’t move forward without adding value to business, so here are a few recent consumer studies showing the direction and effects of consumer demand:
1. Consumers Are Willing to Pay More for Sustainability
According to research published in June by Simon-Kucher & Partners, 54% of consumers globally are willing to pay more for sustainable products. The study shows a 35% increase compared to 2022, indicating growing consumer interest in sustainability. Consumers reported a willingness to pay an average of 25% more for products that meet sustainability criteria, with younger generations particularly supportive of this trend.
According to Bain & Company, over 60% of consumers view sustainability as an important factor when choosing brands, and one-third of them are willing to pay an average of 12% more for sustainable products from a brand they recognise.
2. Sustainable Products Deliver Higher Margins
According to the NYU Sustainable Market Share Index by New York University’s Stern School of Business Center for Sustainable Business, sustainably marketed products often command prices approximately 28% higher than traditional alternatives. These products have driven significant growth, especially in the consumer goods sector, contributing up to 50% of the sector’s growth and growing at a rate seven times faster than traditional products.
3. Resource Efficiency Through Sustainability Efforts Brings Savings
McKinsey & Company reports that companies focused on reducing energy consumption and minimising waste often see 20–30% savings in energy costs. Investing in sustainability can also enhance operational efficiency and bring savings.
For example, Coca-Cola replaced plastic shrink wrap in its European multipacks with 100% recyclable cardboard. This new packaging supports recycling while also reducing plastic waste and logistics costs due to easier handling and transport.
4. Sustainability Strengthens Brand Loyalty and Value
According to a 2021 survey by PricewaterhouseCoopers, 83% of consumers in the United States, Brazil, the United Kingdom, Germany, and India consider sustainability important, and companies that communicate their environmental impact transparently can build stronger relationships with customers. The willingness to pay a premium is often linked to the credibility of sustainability claims. As consumer knowledge increases, data verified by third parties can play a decisive role in convincing customers of a brand’s sustainable practices, directly impacting sales.
5. Sustainability Provides Companies with a Competitive Advantage
Preparing for future regulations can proactively reduce costs. According to Roland Berger, particularly within the EU and North America, regulations are expected to tighten, and companies that have integrated sustainability into their business models will find it easier to comply with new rules. Proactive measures can reduce future compliance costs and help avoid penalties, positioning companies as leaders.
Sustainability Reputation Attracts Top Talent. Deloitte’s research indicates that companies known for their sustainability efforts are more likely to attract and retain top talent, with 76% of American millennials considering a company’s social and environmental commitments when choosing a job. This can reduce employer branding and recruitment costs and improve employee engagement, positively affecting productivity and corporate culture.
6. Sustainability Remains an Investment Trend
According to McKinsey, 50% of companies actively integrate sustainability into their business strategies, viewing it as essential to growth, risk management, and value creation. Many of these companies make strategic investments in sustainable practices. A study from the 2020s found that many companies expect sustainability initiatives to bring significant value in the next five years, with 40% of executives anticipating concrete financial benefits from their efforts.
In the food industry, companies are increasingly focused on improving the sustainability of their supply chains. According to EY’s 2022 report, eight out of ten supply chain leaders are enhancing sustainable supply chain practices.
Sustainability is a driving force towards a better future. The World Economic Forum (WEF) highlights that sustainable practices in food supply chains are essential to reducing emissions, waste, and improving working conditions in the $9 trillion food industry.
These are just some insights on the consumer-sustainability axis. If you’d like to hear more, please get in touch. I’m particularly happy to discuss how we can support you in leading business sustainability – or even just understanding it, as there’s no shame in still figuring it out in these turbulent times. The pace of change is so rapid that, even though I’ve thought about, read, and discussed these issues throughout my career, keeping up feels like it takes a lot of teamwork right now.
Best regards,
Tiina Saukko
P.S. If you’d like a demo of our Infine Insight service, you can book a time in Simon Panelius’s calendar via this link.
