Perception of brands’ sustainability performance is slipping

The Sustainability Leadership Report measures the real versus perceived performance of 100 top global companies around environmental, social and governance factors.

More than a third (68 per cent) of brands in the top 100 registered a “surprise” decline in perception scores year on year, despite more than 90 per cent increasing their score for real performance, signalling that brands are failing to communicate their position or success in these areas.

The report, now in its second year, splits the 100 firms into four groups: leaders, challengers, promoters and laggards.

AXA, Coca-Cola, Deutsche Bank, EADS (Airbus), General Electric and L’Oreal all improved their ranking from ‘challengers’ to ‘leaders’ this year, demonstrating a strong sustainability record and successful communications strategy.

Of the companies that were deemed to be leaders in the 2011 study, 19 registered a “significant slip” in 2012.

Nike and HP were among five brands that slipped from the leaders category back into the challengers group, suggesting that they are falling behind in their communications efforts.

Adidas meanwhile, remains categorised as a ‘laggard’ in terms of perception despite making “substantial real performance gains”, according to the report.

BrandLogic CEO Hampton Bridwell adds: “We hope companies, whether they’re among the 100 we analysed or not, see this work as more than just another ranking. Rather, it’s an evidence-based management framework useful for understanding a fuller impact of corporate sustainability and uncovering new growth opportunities or reputational risks. Our goal is to help companies realise new results by aligning their branding, communications, reporting and stakeholder engagement processes.”

The study was carried out by brand consultancy BrandLogic and sustainability analytics firm CDR Analytics, which also creates the NASDAQ Sustainability Index.

Perception data comes from is gleaned from a global study of 2,500 participants who are “highly attentive” to sustainability issues in the UK, US, China, Japan, India and Europe. Real performance data was gathered by CDR’s qualitative and quantitative platform which measures 141 performance metrics.

The 100 firms are selected according to criteria including brand value, industry representation and publicly traded stock. Brands that fail to meet all criteria are removed while new brands are added.

Barclays, Dell, Facebook, H&M, John Deere and SAP were added in 2012 while Henkel, Kraft, Motorola, Nivea, RIM – Blackberry and 7-Eleven were removed.