Capitalism's Conscience: Can ESG Save Advertising From Itself?

WPP isn39t alone in recognizing the business case for ESG As Campaign UKamp160reports the Institute of Practitioners of Advertising IPA found that quotESG can give agencies the competitive edgequot and quotbe a valuable differentiator to clients choosing an agencyquot And then there39s the Campaign US article titled quotThe Rising Marketing Megatrend ESGquot Oh wait That39s a promotional feature aka paid content from Bloomberg Media On second thought that39s perfect a research company39s sales pitch on what the quotESG gold rushquot means for people working in quotmarketing functions in media sales ad agencies or client sidequot Here39s some excerpts from the article39s video explainerquotOur team specializes in providing actionable insight on environmental social and governance Whether it is a global Race to Net Zero or the Extinction Rebellion campaign the E Workers39 safety conditions or the Black Lives Matter movement the S Diversity on boards or big tech battles around data and privacy the G amp8230 Simply put ESG has moved from a trend to a key component of the company39s corporate and financial strategy amp8230 Companies with poor ESG performance have proven to be more volatile and more at risk of brand value reputations and margins at risk amp8230 It is precisely because of the ESG momentum that regulators and market authorities in Europe China and now the US are accelerating ESG requirements to both corporations and investorsquotIn the United States the world39s largest money manager Blackrock has joined shareholder activists like As You Sow in calling for more transparent ESG reporting from publicly traded companies So it39s no wonder the Securities and Exchange Commission SEC is now weighing whether to make such disclosures into regulatory requirements with consistent standards and scoring systems that could be more easily compared across companies by discerning investorsThe Bipartisan Policy Center expects the SEC to announce rulemaking on climate disclosure in October quotwith board diversity and human capital soon to followquot and reports that the Corporate Governance Improvement and Investor Protection Act House Resolution 1187 which passed the House of Representatives and is now on its way to the Senate would require ESG disclosure and standardized reporting metrics for a range of issues including workforce demographics board diversity and workplace harassment and discrimination to help guide quotsound investment decisionsquot So we could very well be headed towards a new era when corporate social responsibility will be subject toamp8212imagine thatamp8212actual public accountability In other words a time when good outcomes matter more than good intentionsAnd yet when you39re a hammer everything looks like a nail So I worry that advertising will embrace ESG less as a check and balance and more as a tool of perception and persuasion For example when Ad Age reported that the Association of National Advertisers ANA was quotranking brands by Environmental Social and Governance impactquot it claimed that the trade organization will maintain an index updated monthly so quotconsumers and brand watchdogs have a new way to keep track of how brands are measuring up on their purposedriven promisesquot But the index doesn39t measure whether those promises were kept it only measures how they are perceivedLike Bloomberg the ANA also posted a video explainer for their ESG index or SwayableANA ESG Brand Perception Index Poll to be exact But this one ratchets up the production values by adding actors to play earnest executives at work and smiling citizens at leisure an epic soundtrack to pull at your heartstrings and soaring drone shots over urban technology and natural purity locations They even one up Bloomberg39s clichamp233d broll of BLM marches and perfunctory Greta Thunberg file photo with a more stylized and yet conveniently less specific slowmo hero shot of a young woman of color with a raised fist holding up a smoking road flair a generic protest gesture as empty as Kendall Jenner39s Pepsi After all the ANA isn39t measuring what brands are doing to meet their ENG commitments only the popularity of their polling As the voiceover explains the point is not to actually hold brands accountable but rather help them finetune promote and amplify their virtue signalingquotIn our fast moving digital world where consumers encounter thousands of messages a day effective storytelling is key More and more consumers seek out brands that share their values on Environmental Social and Governance issues amp8230 But in a crowded noisy marketplace consumers are flooded with conflicting information How does this drive competitive advantage How do brands know that consumers have gotten the message The answer is simple We ask themquotAs of this writing Hershey and Dove were tied for first place in the SwayableANA poll Which makes sense Who doesn39t love chocolateClick the social buttons to share this story with colleagues and friendsThe opinions expressed here are the author39s views and do not necessarily represent the views of MediaVillagecomMyersBizNetamp160

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Capitalism's Conscience: Can ESG Save Advertising From Itself?

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Christopher Boulton

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