The Role And Importance Of Ethical And Sustainable Branding In Organizations

• An overview of ethical and sustainable branding theory (considering the economic, environmental and humanitarian perspectives)
• Examination of the stakeholders in the ethical and sustainable branding environment
• Identification of strategic advantages to, and issues in, ethical and sustainable branding
• Identification of your position on the role of ethical and sustainable branding in contemporary organisations, with an explanation as to why, with a real life example to support your position.

Understanding Ethical and Sustainable Branding

Branding is one of the most important means of marketing and selling products to consumers and brands are one of the most significant purchase selection criteria among consumer. A brand reflects the reputation and goodwill of the company and its product. The brand has the capability to change the minds of the consumers can be positively or negatively while including an environmental perspective (Pookulangara & Shephard, 2013). Company’s brand plays an important role in the managing the stability of brand in the market. The brand has the capability to enhance the firm’s status, which ultimately reinforces the brand in turn. This branding is used by the businesses to signify the additional value in the product and services offered by the organization in terms of environmental benefits. Another advantage is given to the consumer using the product as they are getting the product, which is sustainable in nature and cannot harm the environment (Racked, 2018).  

A brand can only be said to be sustainable in nature when there is credible change, which is taken into consideration by the relevant customers. A brand has the ability to evoke the positive as well as negative feelings in the individual. This feel is finding especially in reference to the sensitivity of a person on social and ecological issues pertaining in the environment. These are also called the green brands, which are associated with the environmental conservation, and sustainable business practices (The Branding Journal, 2018).  

The ethical and sustainable branding theory relates to the benefit that the society is getting from the product and service. By using this theory in the product and services of the company, the economic performance of the company has taken the heights in which their sale tends to increase. This will also help in increasing the goodwill of the firm to get a peak in the market. Use of the sustainable energy sources in the environment makes the image of the organization positive in the market, which able to grab the large customers to firms (Blombäck  & Scandelius, 2013).

Another advantage that these theories give is to change the face of the society. Humanitarian perspective has been used in this theory. The logical outcome of one group is to protect or increase the political, social, and economic welfare at large at the expense of another group. This is simply done by using the ethical and sustainable branding in the operations of the business. This will enable to survive for the long term in the market without any interventions of government (The Good Trade, 2018).

The Advantage of Ethical and Sustainable Branding

It is important that brand fights for human rights and for their employee's wellbeing. This include gender equity within the teams at management level in meetings, no discernment as to the nationality, race, religious beliefs, class or political opinions, professional growth of employees, good working conditions in the organisation to sustain, and zero tolerance for corruption, disrespect, harassment or dishonour behaviour (Peloza, White & Shang, 2013).

However, the branding not only affects the consumer and employees. Other stakeholders are directly affected by the company’s activities. An ethical brand needs to have a focus and concern for the other remaining stakeholders too and show them respect. Other stakeholders include shareholders, investors, government, suppliers, distributions, employees, consumers, surrounding communities, partners, competitors, and the public good. The relationship with the stakeholders can be sustained only when there is a long-term trusting between the company and its related parties. Proper use of communication between the internal and external stakeholder’s is the key to success to enhance the overall stakeholder’s value. Sustainability policies are made to achieve the economic performance, which is based on environmental and social responsibility (Luchs, Naylor, Irwin & Raghunathan, 2010).

The business will enjoy various advantages by using the ethical practice in its business is an increase in the goodwill and publicity at large in the market, satisfaction, and honor received by shareholders and investors by working in a good work. The companies will enjoy the competitive edge in the market by following the moral values and obligations. The strategic advantage of the company is enjoying is the retention of the customer and their lo6yalty towards the brand remains constant due to the ethical behavior followed (Lewis & Potter, 2013). 

The issues, which are faced in ethical branding, include the issues related to the dishonesty. A false advertisement for the product offered by the company may face the problem the legal consequences. The Federal Trade Commission is there to have an investigation into the false advertisements and may put penalties on the companies involved in the false practices (Dowd  & Burke, 2013).

To its critic's sustainability is all about to cover up and spin. Many companies used CSR as a kind of corporate public relations rather than a genuine attempt to change the way they interact with society. When the ethical and social activities are done for managing the risk in the environment then it should not be fraud in nature.  when the advertisements are found to be fake and unsustainable in nature is doomed to be the failure on its own term. The greatest example is seen in company Enron. The company has made great policies on climate change, human rights and win six environmental awards in the year 2000. However, some issue has been raised on the name of the company from which all the activities and awards received by the company has no importance. The branding name reflects the goodwill and image of the company (Hahn & Kühnen, 2013).

The Challenges of Ethical and Sustainable Branding

One of the brands in clothing based on the USA is Everlane who is following the ethical practices in producing the clothes and have the transparency in production. The company tries to find such factories, which are transparent in nature and do the work according to the ethics and norms followed in the society and the environment. This brand tries to provide the affordable ethical clothing for women and men both. They try to build the strong relationship with the factory owner to confirm that factory’s honesty and have the right production process in every stage of the procedure (Gupta & Kumar, 2013).

Another example can be taken is of Patagonia Company which is dealing in outdoor apparel, swimwear, and activewear. The company is dealing in fair trade outdoor clothing. Patagonia is considered the defender of ecological ethics in the activewear fashion industry. This company is the first adopter of using the recycled materials and switching to organic cotton. The company is working while seeking the sustainability in its business. The company is focusing on the brand identity and considered as the common door of relationship for all the stakeholder's classes (The Good Trade, 2018).

Another example can be taken is of Nadaam based in New York. Nadaam is changing the world of cashmere. They produce the goods in an ethical way and offer the luxury brands at reasonable prices, as they are offering direct to consumer in the market. They make use of the goat ultra-soft cashmere, which is brushed from the goats and is cradle to cradle certified. This set a high standard to protect the people and resources involved in the production. This company gives support to the nomadic herding families and communities in the region of Mongolia and provide veterinary care to their goats. (Fletcher, 2013). 

From the above three examples, it can be analysed that these companies positioned themselves as sustainable brand in the market which is going to be the success for business. Due to the adoption of sustainable and ethical branding in the business, companies will survive for the long run in future. Making clothes while concerning the environment factors in production makes the company image ethical in the minds of people at large. This will influence the customer to purchase the clothes from these brands only.

Conclusion:

From the above discussion, it can be concluded that the ethical and sustainability branding plays a crucial role in building the image of organization in public. The goodwill of the company and its products are depending on the publicity done by them. The positive image of the company reflects in its sale and revenues. There is find a clear relation between the ethical branding and image of the company. These attributes include integrity, diversity, quality, respect, responsibility, and accountability. These attributes depict the importance that the ethical brand stands for. If the brand is sustainable and ethical in nature then it came to survive in the market for long-term in the market. While identifying the strategic issues and advantages, the branding of the product, service or company can be improved and the image building can be done in the right way. The ethical and sustainable branding is finding to perform various roles, which include building the corporate image, gives the satisfaction and honor to the stakeholders. Everlane, Patagonia and Nadaam brands have been discussed above which gives the clear view that the ethical branding plays an important role and make the brand at the top in the eyes of the public.

Reference:

Blombäck, A., & Scandelius, C. (2013). Corporate heritage in CSR communication: a means to responsible brand image?. Corporate Communications: An International Journal, 18(3), 362-382.

Dowd, K., & Burke, K. J. (2013). The influence of ethical values and food choice motivations on intentions to purchase sustainably sourced foods. Appetite, 69, 137-144.

Fletcher, K. (2013). Sustainable fashion and textiles: design journeys. Oxon: Routledge.

Gupta, S., & Kumar, V. (2013). Sustainability as corporate culture of a brand for superior performance. Journal of World Business, 48(3), 311-320.

Hahn, R., & Kühnen, M. (2013). Determinants of sustainability reporting: a review of results, trends, theory, and opportunities in an expanding field of research. Journal of cleaner production, 59, 5-21.

Lewis, T., & Potter, E. (2013). Ethical consumption: A critical introduction. Oxon: Routledge.

Luchs, M. G., Naylor, R. W., Irwin, J. R., & Raghunathan, R. (2010). The sustainability liability: Potential negative effects of ethicality on product preference. Journal of Marketing, 74(5), 18-31.

Peloza, J., White, K., & Shang, J. (2013). Good and guilt-free: The role of self-accountability in influencing preferences for products with ethical attributes. Journal of Marketing, 77(1), 104-119.

Pookulangara, S., & Shephard, A. (2013). Slow fashion movement: Understanding consumer perceptions—An exploratory study. Journal of retailing and consumer services, 20(2), 200-206.

Racked. (2018). Ethical, Sustainable Brands You Can Really Trust [Online] Retrieved from: https://www.racked.com/2017/8/22/16171338/ethical-sustainable-fashion-brands-where-to-buy-sustainable-clothes

The Branding Journal. (2018). Ethical Branding: A Guide For Creating More Ethical Brands [Online] Retrieved from: https://www.thebrandingjournal.com/2018/02/ethical-branding-guide/

The Good Trade. (2018). 35 Fair Trade & Ethical Clothing Brands Betting Against Fast Fashion [Online] Retrieved from: https://www.thegoodtrade.com/features/fair-trade-clothing