WE Red Bridge Study ESG Imperative for B2B Success in China

WE Red Bridge announced the findings of its latest Brands in Motion study, “ESG Means Business in China.” The research reveals the essential role in corporate reputation shaping that many B2B brands in China see for ESG (environmental, social and governance), with multiple applications, from generating awareness to converting sales.

“ESG is integral to China’s B2B landscape as companies strive for further growth,” said Nicky Wang, CEO, WE Red Bridge. “Our data is clear — ESG decisions are predominantly driven by business impact. Downstream customers are increasingly demanding clean and green supply chains in response to consumer expectations. The increased chatter about ESG globally presents significant opportunities for credible ESG narratives.”

Notable insights from the China report include:

• Nearly all respondents (99%) say they will spend the same amount or more on communicating their sustainability initiatives this year compared to last. Further, half of respondents believe sustainability to be one of the top considerations influencing their customers’ purchase decisions in the long term — ranking it higher than any other factor.
• Although environmental focuses such as low carbon and eco-development are the most popular areas for B2B enterprises’ ESG strategies, employee development is now the second-most important area of focus for the year ahead, with 57% saying employee-targeted initiatives are “essential” or “high priority” to their ESG strategies.
• Larger corporations tend to see greater value in ESG initiatives than smaller companies do. Sixty percent of respondents working at companies with 5,000 employees or more are seeing the value of sustainability in terms of brand awareness as compared to 50% for those working in smaller companies; respondents at larger companies were also 8 percentage points more likely to say such programs assisted with customer enquiries or leads (53% vs. 45%).

Among other insights, WE Red Bridge identifies three strategies of marketing and communications to shape companies’ approach and support business growth in China:

An effective ESG strategy begins with its customers

Let the customer be your lodestar. The survey found that 40% of respondents say that customers are very important to consider when selecting ESG programs, while other stakeholders, such as government (31%), employees (25%) and the public (27%), were ranked lower.

Multinationals must balance domestic and international expectations

Multinational companies often face unique circumstances, with different expectations at home and abroad. One solution that companies should consider is tailoring communications assets and materials to different markets, emphasising sustainability activations in China, while promoting other activations, such as employee-oriented ones, overseas.

How brands tell their sustainability story matters

Owned and paid channels are viewed as the most important way to communicate ESG stories, with social posts (43%) and short-form videos (41%) viewed as the most effective, and earned channels, such as feature articles (24%) and events (16%), viewed as being much less effective.

“As the expectations of many stakeholders change, businesses in China must swiftly communicate their ESG proposition for a first-mover advantage,” said Tony Zhang, Head of Corporate, WE Red Bridge. “Strong sustainability credentials not only meet demands but create opportunities for B2B players to differentiate and win business.”