What is ESG Marketing? Buzzword, or beneficial?

What is ESG Marketing? Buzzword, or beneficial?

The terminology relating to responsible business practices is constantly evolving in part due to politically-charged debates originating in the US, with the 3-letter acronym ESG often in the firing line. In this blog, we look at whether the phrase can and should be applied to the world of marketing…

Mentions of ‘ESG marketing’ in the media are growing, with a 103% increase this quarter compared to last quarter, according to Meltwater. A quick search of #esgmarketing on X loads up tweets by ESG professionals sharing events and resources, but also critical tweets. Tweets that align #esgmarketing with #wokemarketing and even derisive and divisive comments about #esgsnowflakes.

ESG marketing has often been used synonymously with ESG communications and sustainability marketing, partly due to search engine optimisation affecting the way we use keywords, but it’s important to distinguish exactly what we mean by ‘ESG marketing’, to alleviate scepticism and consider the potential contradictions of the term.

What is the difference between ESG and Sustainability?

Although sometimes used interchangeably, ESG and sustainability are not the same.

ESG is tripartite: incorporating Environmental, Social and Governance. It is a set of standards that are useful for measuring risk factors and a business’s impact on society and the environment, and how transparent the business is about its impact.

ESG has its roots in analysing investment risk, as a way for potential investors to assess the ethics of a business. Increasingly, ESG strategy serves as a framework for shaping a company’s strategy and even a company’s values.

Sustainability is a more spacious term, generally meaning living in balance with the world’s resources, and not putting future generations in jeopardy. Essentially, living in a world that we can sustain. Within this term, we are frequently referring to environmental sustainability, but also social factors and challenges.

What is ESG marketing from an outside perspective?

ChatGPT is like an echo chamber and can be used to show us how we perceive things. When asked at the timing of writing, ChatGPT defines ESG Marketing as:

‘ESG marketing, also known as Environmental, Social, and Governance marketing, is a strategic approach to promoting a company’s commitment to sustainability, ethical business practices, and responsible corporate governance. It involves communicating to customers, investors, and other stakeholders how a company integrates ESG principles into its operations, products, and corporate culture.’

We would suggest that ChatGPT has in fact defined corporate communications relating to ESG; not marketing.

What is marketing?

CIM defines marketing as: ‘The management process responsible for identifying, anticipating and satisfying customer requirements profitably.

Marketing efforts are about anticipating consumer demands and offering them the right product at the right time by tapping into key trends. There is a key selling element to marketing.

At AMBITIOUS, we work with clients on B2B PR campaigns, regularly collaborating with marketing teams to develop content and strategies which sit at the “top of the funnel”. Our B2B PR work uses our relationships with the media and other channels to generate mentions, content or increased share of voice, and create leads that convert into clicks, and then sales.

B2B PR, or business-to-business PR, is aimed at other businesses, usually through targeting business and trade media, social media channels and targeting relevant third-party networks and events. Corporate PR is the communication of company goals, messages, values, and achievements. This is to create a positive public image of the business to build relationships with internal and external stakeholders including customers, employees, media, and investors. Both are part of the marketing mix but deploy different tools and techniques.

Can marketing and sustainability even harmonise?

In the eyes of some concepts like ‘ESG marketing’ or ‘sustainability marketing’ are oxymoronic. ESG and sustainability encourage long-term longevity, while many marketing strategies are defined by transience and purely focused on selling products. But this doesn’t have to be the case. As per the definition,  marketing is about ‘anticipating and satisfying customer requirements’.

Therefore done right, these approaches can be applied sustainably to sustainable products and services.

What is the difference between marketing and communications?

Marketing is communications, but communications is not marketing. Communications is telling the story of your organisation, and marketing, as we read earlier, is communications with the direct intent to respond to customer needs and ultimately sell.

  • For example, a car company might send out a series of Instagram posts with photos of their employees volunteering with a foodbank to showcase their social impact and to show customers they care about local communities as well as cars. This is communications.
  • However, if they run an Instagram campaign showing positive reviews of a newly released car model, this is marketing.

While they both contribute to making a profit, communications achieves this indirectly by building trust with stakeholders and shaping public perception, whereas marketing is more associated with sales objectives.

So, what do we mean by ESG marketing/communications?

While marketing and PR can both work to raise revenues, communications achieves this indirectly by building trust with stakeholders and shaping public perception, whereas marketing is more associated with sales objectives.

Perhaps we could conclude that you can only take part in ESG or sustainability marketing if you’re selling a sustainable product or an ESG service. For example:

  • Octopus energy, a renewable energy provider that can install electric vehicle charging points.
  • Neighbourly, an online volunteering platform that connects businesses with local charities that need volunteers, or surplus products to charities that need it.

What makes it marketing, is its intention to sell something, what makes it communications is its contribution to brand image.

At AMBITIOUS, we prefer the term ESG PR or communications (we are a PR agency after all!), unless we’re promoting an ESG product or service. This is because we feel that the complexity of ESG and sustainability messaging is more suited to the nuanced tools and tactics that PR can encompass.

So, what is ESG communications?

In short, ESG communications is communicating with your audience about ESG initiatives that your organisation is running whether it be ESG goals, ESG plans or ESG data. There is not a direct selling element to these communications, although there might be one indirectly by increasing stakeholder trust.

For effective ESG Communications, businesses need to use their ESG criteria to prove their sustainability. The concepts of ESG and Sustainability are centred around longevity, and stakeholders are quick to sniff out greenwashing, or performative activism.

For example, L’Oréal faced backlash from Munroe Bergdorf for their statement supporting Black Lives Matter in 2020. Bergdorf, who is black and trans, was hired by L’Oréal in 2017 but was sacked for speaking out about racism and white supremacy on social media.

ESG initiatives, then marketing efforts

It’s important for businesses to start by adopting sustainable strategies, measuring the positive impact of your company’s progress, and then telling your story. ESG began as a tool, to help shape a company’s strategy sustainably and for investors to assess ethics. Begin with ESG as a framework, and use it to inform your company’s brand and business models through ESG strategies, then move into telling ESG stories.

What can we do?

One thing we can do to alleviate scepticism of ESG is to be clear about what words we’re using, and why, to create pertinent content.

The fear of using the wrong language is one of the things that can put companies off talking about sustainability. Even when a corporation has ESG goals or ESG values, they sit quietly on them, out of fear of being accused of greenwashing and inciting corporate risk incidents. This act of keeping silent is known as ‘green hushing’.

One great resource to counteract this is Edie’s jargon buster which is incorporated into their daily ESG email newsletter. It’s one easy way to keep up to date with current relevant news and language surrounding climate change and corporate social responsibility.

When prominent figures (and, indeed, X users) accuse PR and Marketing professionals of using ESG messaging as buzzwords, we can stand firm in our integrity knowing we have put the action and education behind our words.

 

At AMBITIOUS PR, we influence with integrity. To us, this is saying what we mean, and meaning what we say. This is especially crucial when it comes to our ESG service. If you’re unsure where to start with telling your business’ ESG story, get in touch to find out how we can help.