The good folks at CSRHub have been doing great analysis on the correlation between Brand Strength as reported by Brand Finance and CSRHub’s corporate social performance metrics. The important news is that most categories of corporate social performance have either a strong or moderate correlation to brand strength, and those factors are on the rise.
CSRHub ingests sustainability information from 230 sources that each have their own way of measuring and rating corporate social performance. In order to make sense of these different measures (CSRHub have more than 9,000 different indicators in their system), CSRHub has mapped each indicator from each source into one of twelve “subcategories.” These subcategories are then grouped into four categories (with three subcategories in each category).
The chart below highlights which corporate social performance measures contribute the most to the overall brand strength. It is a strong reinforcement of how treatment of employees and environmental responsibility are growing factors in the strength of brands.
In summarizing the results of the analysis, CSRHub said “We would expect that product sustainability, leadership ethics, and a company’s environment policy and reporting would be tied to brand strength. These are areas that companies actively invest in and communicate about. The weaker ties to board performance, transparency and reporting, energy and climate change, and resource management may be due to the fact that consumers have few means to connect these areas with the products they buy. The most surprising results are the weak relationship between brand and human rights and supply chain issues, the modest effect of community development and philanthropy, and that how companies treat their employees is important to their brand strength.”
Many studies have already confirmed that consumers are keenly aware of how a company treats its employees and consider a key factor in the brands reputation and their interest in doing business with it. As awareness and the impacts of climate change continue to grow, a corporate’s commitment to sustainability and environmental stewardship will also be a key factor in determining which brands are leaders and which are laggards.