For years, businesses have made it a priority to improve their perception for environmental, social, and governance (ESG) issues. Oftentimes, businesses have viewed ESG in context of their fiscal decisions, which is why ESG has been mostly the province of the corporate investor relations (IR) team. But times are changing rapidly.
Businesses realize that ESG touches every part of the enterprise. Improving a corporate reputation for ESG requires a coordinated effort among multiple stakeholders – IR, human resources, marketing, and operations, to name a few. A recently created ESG Brand Perception Index by the Association of National Advertisers (ANA) underscores this reality.
What Is the ANA ESG Index, and Why Does It Matter?
The ANA ESG Brand Perception Index ranks U.S. brands based on their (ESG) impact. According to the ANA, the index is based on daily surveys of consumer opinions on the ESG performance of more than 400 brands across seven industries. The surveys are based on a sample of 15,000+ consumers (age 18+) and are updated monthly.
Respondents are asked questions on brand familiarity, purchase intent, environmental and social impact, and level of trust in brand governance in addition to answering a range of demographic, attitudinal, and behavioral segmentation questions.
Why is the index significant?
The index is significant for a few reasons:
It comes from the ANA. Many ESG indexes are investor oriented. They’re driven by organizations that want to share a measure of corporate fiscal accountability in ESG. For example, MSCI Inc. manages 1,500 equity and fixed income ESG indexes designed to help institutional investors more effectively benchmark ESG investment performance and manage, measure, and report on ESG mandates. The ANA, though, is focused on advertisers. The existence of an ANA ESG Index shows that ESG is pervading all corners of the organization in response to the emergence of a more purpose-driven generation of consumers who want to align their purchasing decisions with businesses with strong ESG track records. In fact, ESG shapes the perceptions of both consumers and employees.
It’s a public index that is updated monthly. Anyone can view the index by visiting this site and seeing how the companies rank across all industries covered. Since the data is updated monthly, site visitors can discern who is getting better, and whose standing is slipping. A key insights page connects the dots with a discussion about any notable trends for the month, and the report quotes consumers commenting on brands by name. For example, in June, respondents gave both Home Depot and Target praise for their employment practices, and both General Mills and HEB were cited for their commitment to ending hunger. The transparent nature of the index makes it a more effective metric to hold businesses accountable.
An effective commitment to ESG requires a concerted and coordinated effort from all the stakeholders of an organization. ESG indeed drives investor decisions – as well as purchasing decisions and career choices. That’s because the people who invest in a company overlap with job seekers and investors.
At Investis Digital, we advocate for a Connected Content approach to ESG. Connected Content unites communications, digital experiences and performance marketing that enables a business to forge deeper relationships with their audiences, building trust and driving business performance. Connected Content helps businesses achieve that important alignment across all stakeholders. Read more about how businesses can take a more holistic approach to ESG in our newly published report, How to Build a Trusted Brand with the 4Rs: Responsibility, Reputation, Recruitment, and Reach. And contact us to learn how we can help you build trust through your ESG commitment.