By: Lauren Hughes
Online shopping platforms have given consumers an overwhelming number of options to choose from. As companies continue to enter the ecommerce space, consumers are faced with more choices. How does one choose which brand to shop from? Many people take into account the price and quality of the product. However, consumer behavior is changing. Consumers are more focused on corporate social responsibility, and whether they are supporting brands whose values align with our own. Corporations continually craft bold mission statements to explain how they will grow their business, while abiding by legal and environmental standards; these mission statements are not enough to establish consumer trust. An article from Forbes explains, “Although 81% say trust impacts their purchasing decisions, only a third of people say they trust the brands they buy from” (Fertik, 2019). So, how can we learn to trust companies and feel confident in our purchasing decisions?
Company Initiatives
Company websites will often have an initiatives page; this is where the company will share information about their efforts to be socially responsible. Important information to look for includes the types of resources they use to produce their products, and how their operations impact the environment. Additionally, donating to charitable causes and volunteering initiatives are positive signs of a company who’s looking to do more than simply maximize shareholder wealth.
ESG Ratings
Public companies are given Environmental Social Governance (ESG) ratings. These ratings help investors determine whether a company is worth investing in, based on which end of the spectrum they are scored on. Some of the factors that ESG measures are carbon footprint, water usage, natural resource conservation, employee working conditions, and accurate accounting principles (Chen, 2021). Comparing company initiatives with their ESG scores can show whether they are “greenwashing”, or truly committed to running a socially responsible business. All UMass students have access to the ESG Manager on Campus database, which provides in-depth ESG reports for hundreds of companies!
Online Presence
Having a presence on social media is critical for business success. It is important to look at how a company engages with their consumers online, and whether they respond to customer feedback. For example, if they ignore negative feedback, maybe they are not “operating in the consumer’s best interest” (Fertik, 2019). Looking at their social media page can also give insights into company values; if you relate/feel passionate about the content they share, you are shopping with the right brand!
Some brands that have successfully developed a socially responsible reputation include Levi Strauss, Ben & Jerry’s, LEGO, and Google. As consumers, we want to make sure our money is being spent in the right places. It can be difficult to determine whether companies will truly uphold their promises to be socially responsible, using the resources above will help.
Sources:
https://www.investopedia.com/terms/e/environmental-social-and-governance-esg-criteria.asp
https://www.vault.com/blogs/workplace-issues/5-ways-to-identify-a-companys-social-responsibility
https://www.businessnewsdaily.com/4679-corporate-social-responsibility.html