To stand out in the overcrowded ESG debate, FMCG companies should focus more on a proactive, positive impact rather than just doing less damage to the planet.
The context: In recent years ESG has evolved into a cornerstone of PR efforts for FMCG companies. This has been driven by a rising demand for responsibility and transparency, which are now pivotal in shaping brand reputation and consumer trust.
The problem: The FMCG industry overwhelmingly focuses its ESG messaging on minimising environmental harm.
Our analysis of 2,958 English-language articles published between August 2022-March 2024 found that most FMCG companies tailor their ESG comms towards reducing emissions, recycling, packaging and waste management:
This can make FMCG companies’ messaging monotonous and repetitive. For instance, most FMCG giants in our analysis were eager to highlight their pledges to become net zero by 2050 or to recycle all packaging by 2030.
We’re used to hearing that from the Coca-Colas and the Pepsis of the world every time there’s a new report naming them as the biggest polluters. Unfortunately, this can give the impression that FMCG companies are simply reacting to pressure from researchers, regulators and NGOs, rather than proactively shaping a sustainable future.
The opportunity: positive impact and regeneration
Our research suggests that to truly differentiate themselves, FMCG companies should focus more on a proactive, positive impact rather than just doing less damage.
This means taking a regenerative approach that shifts the focus from “how can we do less harm” to “how can we restore and improve the planet”.
And it makes good PR. Companies that have included some regeneration as part of their ESG comms, including Nestlé, Danone, Pepsico and Unilever, managed to gain more media attention as they generated more interesting stories in addition to their run-of-the-mill emissions pledges. This is illustrated on the map below, which shows the links between the topics (represented by squares) and the companies (represented by circles).
How to position yourself as a regeneration leader
Regeneration, unlike sustainability, is still a pretty new ESG trend. This means a fresh landscape brimming with untapped opportunities for brand positioning. But how to find them?
Let’s start with what’s already there. By analysing the regeneration coverage drivers around prominent FMCG companies, we found that they had a strong focus on land restoration – this is evident in initiatives like PepsiCo and Walmart‘s partnership to enhance soil health and water quality, and Nestlé‘s commitment to planting 10 million trees in Australia.
Others are also looking to foster sustainable industry practices and community engagement, as seen in General Mills‘ strategy for farmer-driven regenerative agriculture and Danone‘s efforts to incentivise young farmers to enter the dairy sector.
Analysing these coverage drivers not only offers a more granular and thorough view of the conversation but also allows for white space mapping – pinpointing areas where there is little to no media coverage, offering a sort of “blank canvas” for strategic messaging.
This targeted approach ensures that the messaging is both relevant and impactful, addressing gaps in public understanding or awareness while positioning the organisation as a thought leader.
For example, we identified some ESG white spaces which can be occupied with the right positioning strategy:
- Biodiversity: While most FMCG companies focus on land restoration, more nuanced conversations on enhancing biodiversity, including the protection of pollinators and indigenous plant species, seem to be less prominent.
Positioning strategy: Initiatives that actively enhance biodiversity can include creating wildlife habitats and corridors within agricultural lands to support a wider range of species, including essential pollinators and native flora.
- Cultural regeneration: Media coverage still doesn’t widely address how FMCG companies can support the revitalisation of local cultures and traditions through their regenerative agriculture practices.
Positioning strategy: Cultural regeneration can be embedded in regenerative practices by sourcing ingredients that are grown using traditional methods which support local heritage and by celebrating this through product storytelling.
- Regenerative supply chains: There is a gap in discussions around the creation of fully regenerative supply chains that go beyond primary production to include processing, packaging and distribution.
Positioning strategy: Developing regenerative supply chains involves not only ethical sourcing but also considering the entire lifecycle of the product, including how products are returned to the earth.