Corporate sustainability initiatives, both social and environmental ones, can be a double-edged sword—they can increase brand appeal for consumers—or damage it. Our survey of 3,000 US consumers shows that initiatives that support employees and local communities are the most powerful enhancers of brand equity.
Insight for What’s Ahead: Offering employees decent workplace conditions and equitable pay and supporting local communities can pay off with consumers—but companies need to effectively communicate such efforts. In contrast, speaking out on social or political issues can be risky and is the most likely action to reduce brand appeal for consumers.
The author thanks Allen Li (Associate Economist) and Malala Lin (Economic Research Associate) for all their data analyses for this project.