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Aligning Purpose with Profits: How Consumer Goods Companies can Unlock Business Growth by Integrating Sustainability into their Operations

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The rapid advancement of technology and social media has created a new generation of well- informed, empowered, and discerning consumers. These individuals prioritise brands that not only provide high-quality products and services, but also resonate with their values. As the largest segment of shoppers, purpose-driven consumers (44%) are now seeking out brands that align with their values and lifestyles. This shift in consumer priorities has led businesses to reconsider their practices and strategies, placing increased emphasis on transparency, sustainability, and corporate social responsibility initiatives to capture a larger share of consumer spending.

However, challenges with prioritising sustainability remain, as companies grapple with the complexities of measuring and reporting their environmental, social, and governance (ESG) performance. The vast array of ever-evolving sustainability standards and measurement frameworks only adds to the challenge, leading some companies to cherry-pick metrics to paint a rosier picture, while others strive to genuinely disclose their progress.

To further complicate matters, regional variations in ESG reporting requirements have sown confusion and created obstacles to effective measurement. A recent study by IBM and The Consumer Goods Forum, titled “Redesigning brand values: Purpose and profit converge in core operations,” reveals that although 42% of executives say they have the capability to report on their sustainability targets, only 32% can do so in real time, thus hampering their ability to make swift, well-informed decisions in this crucial arena.

So, as the tide of consumer preferences shifts, how can consumer goods companies ensure that their operations are truly sustainable to tap into this growing market and, at the same time, navigate the treacherous waters of ESG reporting? 

Integrate sustainable practices into operational strategies to unify sustainability and business growth. 

Consumer goods leaders agree (77%) that investments in sustainability will accelerate business growth, with 61% of consumer goods leaders aligning their sustainability and operational goals. Companies are realising that sustainability is not just a separate goal or initiative, but rather it is something that can be integrated into their everyday operations. 

To effectively execute against this, supply chain and operations leaders must collaborate with their C-suite peers to build a cohesive strategy that infuses sustainability into the very core of the organisation’s operational strategy. Organisations have already begun embedding sustainability goals across enterprise operations, including in manufacturing (84%), supply chain operations (80%), and brand strategy (80%) just to name a few. To further advance this strategy, companies should set goals, develop a multiyear roadmap, and define what sustainability specifically means to their organisation.

Harness Artificial Intelligence to assess, predict, and obtain the insights needed to reduce waste and fulfil ethical imperatives.

To help deliver on the promise of operationalizing sustainability, consumer goods industry leaders are expected to increase their technology budgets by 34% in the next three years. Advanced technologies, such as automation, analytics, IoT, AI, and intelligent workflows, are considered critical for delivering differentiating business results and aiding in sustainability. One key process consumer industry leaders are leveraging is AI-enabled workflows (70%). 

By using AI to streamline tasks that would otherwise require human intervention, companies can boost efficiency, curb waste, and optimise resource utilisation. For example, precision agriculture leverages AI-driven systems to analyse data from various sources, optimising irrigation, fertiliser application, and pest control to maximise resource allocation and curb environmental impact. In manufacturing, this method can enhance production processes and bolster quality control, ultimately conserving raw materials and energy.

The use of predictive and prescriptive analytics and AI-powered demand sensing (69%) are also being used to improve inventory management and eliminate excess stock. AI-powered demand sensing is a method of using artificial intelligence and machine learning algorithms to analyse a wide range of data sources and generate real-time insights into demand for a particular product or service.

By analysing factors such as historical sales data, weather patterns, social media trends, and consumer behaviour patterns, AI-powered demand sensing can help consumer goods companies anticipate shifts in demand and adjust their production, inventory, and supply chain operations accordingly. This can help companies reduce waste, improve operational efficiency, and better meet the needs of their customers.

Embrace data-sharing platforms to create an efficient and waste-free supply chain that is able to quickly respond to changes in demand.

With the supply chain accounting for over 90% of greenhouse gas emissions associated with providing a product or service, it’s essential to have visibility into the environmental impact of each step of the supply chain. 

Redesigning Brand Values found that less than 25% of consumer goods leaders have established visibility across the full product lifecycle or end-to-end supply chain, and 40% of executives face siloed operations. Data-sharing cloud-based platforms are helping companies track emissions, waste, energy usage, and other sustainability metrics in real-time, providing a comprehensive view of their environmental footprint.

The evidence is clear: CEOs who are integrating sustainability and digital transformation, and have a clearly defined sustainability strategy, are realising higher revenue growth, achieving up to 41% more than their counterparts. This underscores the importance of integrating sustainability into business operations, which can be done through a robust combination of business process, technology, ecosystem partnerships, and C-suite collaboration across manufacturing, technology, operations, supply chain, and sustainability. 

By embracing this holistic approach, consumer industry executives can not only satisfy consumer demands but also drive substantial growth and success in an increasingly competitive market.

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‘More business growth needed to absorb graduates’

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UWI Cave Hill’s deputy principal Professor Winston Moore said work had to be done to create more opportunities for graduates. (Picture by Lennox Devonish)

There is nothing wrong with the number of individuals who graduate from the University of the West Indies (UWI) each year.

However, there is a need for more businesses to be created to utilise their skills and talent.

That is the view of deputy principal, Professor Winston Moore who said the Cave Hill Campus could have a greater impact on new businesses.

“The problem isn’t the number of graduates; the problem is the number of businesses that we have created. I think what we always have to do is work on creating opportunities for the graduates. Once you are creating businesses you are going to be creating jobs. If we can get more businesses being formed, more innovation being done ….

“The university has the opportunity to impact the number of new businesses. If we can do that, we can definitely absorb a number of these new graduates,” Moore said.

He made those comments on Tuesday night at the Roy Marshall Teaching Complex at UWI, during a lecture entitled Valuing The Impact Of The UWI, Cave Hill Campus, which was held in association with The Nation Publishing Company Limited.

During the hour-long presentation, Moore reasoned that while the campus still had a contribution, he said there were skills gaps that had to be filled through greater collaborations with the Barbados Community College (BCC) and Samuel Jackman Prescod Institute of Technology (SJPI).

“We need to continue working together to ensure we fill the skills gap that still exists. Even though we have seen a large number of persons graduate from UWI, there is still a need for more training at the university level, from SJPI and BCC.

“We need to work closely together to make sure the skills that are coming out are more closely aligned with the needs of society,” he said.

He estimated that the impact of UWI exceeded the financial investment while noting that the Barbados Government paid tuition fees for locals.

Moore stressed that the campus could stand to benefit from greater contributions.

“The annual economic contribution is around $325 million . . . the regional contribution is around $95 million, so if we compare the value that is generated from individuals, firms and business relative to the contributions from regional governments, you can see that the Cave Hill campus is making a significant contribution to the economic benefit of individuals in Barbados and throughout the Caribbean.

“It makes a strong case for other governments to do something similar as well because the return on investment is quite significant. If you are getting $3.42 for every dollar, there is no other investment in the Caribbean that gives you that type of return. We can’t get the skills coming out of university if we don’t have the income coming in that suits those skills,” Moore added.

Professor Justin Robinson hosted the lecture which was attended by scores of other university staff, students and officials such as Senator Dr Chelston Brathwaite, Chief Executive Officer of the Nation Group of Companies Noel Wood, Head of Advertising for Nation Group Paulette Jones and Business Development Manager Kelly Johnally.

In her remarks, Jones highlighted the importance of the relationship between the NATION and the university.

UWI celebrates its 75th anniversary this year and the NATION its 50th.

“Both our sectors, education and media, must be in a similar situation; a constant fight to defend the integrity of the information we share in an era of fake news.

“Even as we both entertain and encourage robust discussion, the effort necessary to cut through the noise requires a different set of skills and resources. Yet we both understand and are committed to our respective roles of educating, preparing, telling, and sharing the stories of our people, our culture to the world and our responsibility to build our nation and to represent the people of the Caribbean as only we can,” Jones said. (TG)



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