NEWS7 July 2021

Brands favour ad agencies with environmental and social values

FMCG Finance News Sustainability Trends UK

UK – Advertising agencies could benefit from marginal gains over competitors by promoting and demonstrating environmental, social and governance (ESG) values and actions, research from the Institute of Practitioners in Advertising (IPA) has found.

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The research, carried out by Opinium, suggests that while proof of ESG does not win business on its own, it can be an important differentiator with other advertising agencies when brands are increasingly focusing on and valuing ESG.

The research is based on 10 in-depth qualitative and 51 quantitative interviews with marketing and communications leaders across financial services, fast-moving consumer goods and food and drink.

The research found that 80% of respondents agreed that ESG is important in day-to-day basis, with 51% saying Covid-19 accelerated this trend.

Brands also felt agencies should have high standards in understanding their values and ESG priorities, with 84% of respondents stating that an agency must reflect their company values and 65% that agencies should demonstrate an understanding of ESG priorities.

Most respondents said their company had implemented ESG practices, with 72% seeing the implementation as largely a success.

However, the research found that numerous factors such as effectiveness, creative solutions, relevant services, experience and strong chemistry were ahead of ESG when deciding whether to appoint an advertising agency.

Julian Douglas, president, the IPA, said: “This report highlights the need for agencies to walk the talk when it comes to demonstrating their commitment to their brands’ and their own ESG credentials.

“As the evidence shows, brands do look to us for effective, creative solutions coupled with great chemistry as our fundamental offering but increasingly we need to have all this coupled with a leading advantage in the field of ESG to have that vital competitive edge.”