Media Release: Australian consumer goods companies under pressure to be more sustainable

MEDIA RELEASE APRIL 2009

A large study into sustainability in the national consumer goods sector reveals companies under more pressure to be sustainable but hampered by a lack of understanding about the economic benefits.

The Retail World FMCG Sustainability Barometer Survey, released last month, involved 271 participants from across the spectrum of Australian consumer goods companies, with around 40% of respondents from the CEO / senior Exec level.

Brent Couper, from the FMCG Sustainability Institute who conducted the survey, said survey results indicate that sustainability is still relatively new among Australian consumer goods companies, but the trend is growing.

‘Global companies such as Wal-Mart, Tesco, and Marks & Spencer are demonstrating that sustainability can and does have a positive impact on the bottom line,’ Mr Couper said.

‘Locally, major retailers such as Woolworths are following the lead and driving change. Suppliers in the industry are increasingly under pressure to become more sustainable, but require help in understanding and applying sustainability in their businesses.’

Key survey results:

* Sustainability pressures are rising:  60% of respondents said their company is under more pressure to become sustainable.  8 out of 10 believe that the importance of sustainability is going to increase over the next 2-3 years.

* Pioneers are Forging Ahead:  Although new, organisations are adopting sustainability:
o almost half claim to have sustainability strategies
o a third have conducted an energy, water, waste audit
o almost half use green credentials in marketing
o a quarter of respondents have had training

* Cost v Benefit?  Jury still out: Views on the impact of sustainability on profitability are mixed: approx 50% believe profitability will increase, while approx 33% feel it will decrease.

* Barriers to progress include a lack of targets, measurement and reporting. Only1 in 5 have sustainability targets in their business plans, and only 1 in 10 are formally reporting on social impact and performance.

“Large companies are leading the way here. In 2008 almost 80% of the world’s largest companies prepared sustainability reports. The Australian consumer goods industry will inevitably adopt this approach over time,” Mr Couper said.

“A key factor in motivating progress will be increasing industry understanding about the economic benefits of sustainability. Wal-Mart is one of only two companies in the Dow Jones industrial average whose share price rose last year. Sustainability is a core part of that result.”

Full survey results can be downloaded from the FMCG Sustainability Institute website: www.fmcg-sustain.com.au The study was conducted by the Institute in collaboration with research partners Retail World Magazine, Jigsaw Strategic Research and i-Link Research Solutions.

-ENDS-

Media enquiries: FMCG Sustainability Institute – Lee McAllistair 0414 941 585 enquiries@fmcg-sustain.com.au