Effect of COVID-19: Consumers are willing to pay to support a sustainable future

WITH consumers around the world becomingly increasingly concerned about the global climate crisis, many industries have initiated action to meet their customers’ and investors’ expectations by managing their own environmental goals.

Having started to put emphasis on sustainability a few years ago, consumers are increasingly focused on shopping with brands whose mission they care about despite price being a big factor in their purchasing decisions.

However, the COVID-19 pandemic has elevated consumers’ focus on sustainability and willingness to pay out of their own pockets for a sustainable future, according to a new IBM Institute for Business Value (IBV) survey of over 14,000 consumers in nine countries.

Moreover, since the coronavirus took over the world, nine in 10 consumers surveyed reported that the COVID-19 pandemic affected their views on environmental sustainability.

Furthermore, COVID-19 has become the top factor influencing their view – more than others presented such as widespread wildfires/brushfires, disasters due to weather events and news coverage on the topic.

According to the survey, many consumers are increasingly willing to change how they shop, travel, choose an employer and even where they make personal investments due to environmental sustainability factors.

“We see many companies beginning to make strides to build transparent supply chains or improve energy management to reduce carbon emissions with the help of innovative technologies like artificial intelligence (AI) and blockchain,” said IBM Global Business Services’ global lead (sustainability, climate & transition) Dr Murray Simpson.

Having said that, the IBM survey also revealed differences in consumer opinion across geographies, with Americans surveyed reporting the least concern about sustainability topics.

Willingness to accept lower salary

The survey revealed that most employees and employment seekers (71%) surveyed say that environmentally sustainable companies are more attractive employers.

In addition, more than two-thirds of the full potential workforce respondents are more likely to apply for and accept jobs with environmentally and socially responsible organisations – and nearly half surveyed would accept a lower salary to work for such organisations.

Concurrently, 48% of the respondents trust corporate commitments on sustainability with 64% of respondents expecting increased public scrutiny in the year ahead.

Investment decisions influenced by environmental sustainability

Almost half (48%) of all personal investors surveyed have already started taking environmental sustainability into account in their investment portfolios while a further 21% surveyed say they are likely to do so in the future.

Additionally, 59% of personal investors surveyed expect to buy or sell holdings in the next year based on environmental sustainability factors.

Shoppers, travelers willing to pay more

The survey also found that 54% of consumers surveyed are willing to pay a premium for brands that are sustainable and/or environmentally responsible despite the COVID-19 pandemic’s financial impact on many individuals.

In addition, 55% of consumers surveyed report sustainability is very or extremely important to them when choosing a brand – 22% higher than consumers surveyed pre-COVID-19 pandemic by IBM.

With regard to travel, almost one in three respondents strongly believe their personal travel habits contribute to climate change.

Most of consumers surveyed globally (82%) would choose a more environmentally friendly transportation option even if it costs more with 64% of American respondents agreed compared to 95% of Indian and 91% of Chinese respondents. – April 22, 2021

Subscribe and get top news delivered to your Inbox everyday for FREE