Corporate Social Responsibility in Retail

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Corporate social responsibility (CSR) gives retail organisations an opportunity to be transparent with customers on how they will engage in more sustainable practices and the consumers can hold them accountable to avoid greenwashing. Corporate social responsibility is becoming more evident in large retailers such as Woolworths, through honest environmental marketing.

Due to a lack of universal frameworks around corporate accountability for their carbon footprint, it is up to each organisation personally to determine how closely environmental impacts are considered in their business model.

By conducting an LCA, not only does it provide useful research to gain deeper insight into products, a corporate social responsibility plan can be implemented based off the data. To ensure accountability, these organisations should be transparent with this information to their consumers.

Unfortunately, many retail organisations are greenwashing. Greenwashing is defined as a ‘presenting an environmentally responsible public image, but perceived as being unfounded or intentionally misleading.’

Examples of organisational greenwashing:

  • Lesser of Two Evils – claims that may be true within the product category, but that risk distracting the consumer from the greater environmental impacts of the category as a whole.
  • Vague Marketing – using universal ‘sustainable symbols’ to indicate a sustainable product, without any data or evidence to back this claim
  • Distraction – suggesting a product is sustainable based on a single environmental attribute, or a unreasonably narrow set of attitudes, avoiding attention to other important more related environmental issues like energy, global warming, water, and forestry impacts of paper

Woolworths – Effective Environmental Communications:

Corporate social responsibility (CSR) in retail has evolved from an employee retention strategy to a necessity for longevity in the retail industry. At its most basic, the idea behind corporate social responsibility is to invest in a community in order to offset any negative effects the organisation may have.

Woolworths is an example of a business improving the environmental and social performance of their products and aligning these efforts throughout various functions within the company. They are able to communicate their efforts so that consumers clearly understand the impacts, and other retail businesses can look to them for leadership.

The areas Woolworths focuses on are; their workers, customers and the environment.

Woolworths shared their sustainable strategies in a 2020 report that is freely accessible through their website.

“Our strategy is group-wide with clear targets and commitments for the business divisions. A materiality assessment that involved comprehensive internal and external stakeholder engagement, document review and landscape analysis was conducted to develop our priorities.

These emerging issues include the increasingly connected and diverse communities from which our customers and team members are drawn, concerns for responsible and ethical supply relationships, food and water supply security, and climate change, water and waste management.”

Through company transparency, Woolworths can achieve effective environmental communication to its consumers, even when their targets and goals are not achieved.

For example, “our target is ‘Towards zero food waste going to landfill’. This ambitious target was set in our ‘2007-15 Sustainability Strategy’ and it was not achieved. Currently more than half of the waste stream is still waste food, mainly due to insufficient sorting at the stores. 

Every year until 2020, we will achieve a year-on-year increase in tonnes of food waste diverted from landfill. This will be done through continuing reduction in stock loss, improving store waste management behaviour and improving the effectiveness of the farmers’ program and the food rescue program.”

Research has shown that 87% of customers consider CSR in their purchase decisions, and that “given similar price and quality, consumers [91%] are likely to switch brands to one that is associated with a good cause.”

As a result, other retail organisations should demonstrate corporate social responsibility actions and provide their consumers with real data to avoid greenwashing and let consumers make informed buying choices.

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