Global market analysis – Importance of ESG in consumer purchase decisions
In recent times, the evaluation of a company's impact has shifted to consider environmental, social, and governance (ESG) factors.
Environmental criteria assess a brand's impact on the environment, including factors such as carbon emissions, energy efficiency, sustainability of the supply chain, waste and wastewater management, among others. Social factors examine a company's relationships with its employees, adherence to human rights, data security and privacy, product safety, etc. Lastly, governance evaluates a company's internal management practices, including executive pay, protection of shareholder rights, and female representation.
Do consumers give equal consideration to all three ESG factors (also known as sustainable investment factors) before making a purchasing decision from a brand? Or is there a hierarchy of importance among these factors?
According to YouGov’s multi-market poll, globally, more than three in five consumers consider social factors before making a purchasing decision (71%). With a marginal difference, environmental factors rank second (68%) in terms of importance. Corporate governance factors come last (51%). But the figure varies from market to market.
Consumers in India and the UAE prioritize environmental (79% India and 78% UAE) and social factors (78% Indian and 79% UAE) almost equally, with nearly four in five saying they consider these two factors before buying from a brand. Similar trends are seen in China, Indonesia, Singapore and Hong Kong markets.
Governance factors comparatively have lower scores but about three in five in India (70%), UAE (70%), and Indonesia (57%) consider them important – a large proportion. This factor is not considered important to one in 10 consumers in Singapore (12%), Hong Kong (11%) and China (9%). It can be concluded that consumers in the Asia-Pacific region attach more importance to environmental and social factors compared to corporate governance.
In Britain, a majority of consumers take into account environmental (66%) and social factors (70%) when making a purchase decision. However, one-tenth do not consider these factors important (12% and 10% respectively). As for governance factors, two-fifths say it's important (45%), but a significant portion do not (21%).
Governance factors comparatively have lower scores but about three in five in India (70%), UAE (70%), and Indonesia (57%) consider them important – a large proportion. This factor is not considered important to one in 10 consumers in Singapore (12%), Hong Kong (11%) and China (9%). It can be concluded that consumers in the Asia-Pacific region attach more importance to environmental and social factors compared to corporate governance.
In Britain, a majority of consumers take into account environmental (66%) and social factors (70%) when making a purchase decision. However, one-tenth do not consider these factors important (12% and 10% respectively). As for governance factors, two-fifths say it's important (45%), but a significant portion do not (21%).
Our data sheds light on interesting insights from the Danish market. Danes are the least likely among European markets to consider social factors (58%) important when making a purchase decision. When it comes to governance factors, they are evenly split, with 29% considering it important and 29% considering it not important.
US consumers are least likely to consider environmental factors important compared to 17 international markets (54%). In terms of prioritization, they first consider social factors (60%), followed by environmental (54%) and then governance (41%). A similar pattern is also observed in the Canadian market.
A trend that stands out is that across various markets, a significant portion of consumers are uncertain about the importance of ESG factors when making a purchase decision. Brands and marketers can benefit by highlighting their sustainability initiatives, partnerships with organizations that support environmental causes, and how their products align with those values.
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Methodology
YouGov Surveys: Serviced provide quick survey results from nationally representative or targeted audiences in multiple markets. The data is based on surveys of adults aged 18+ years in 18 markets with sample sizes varying between 514 and 2011 for each market. All surveys were conducted online in November 2022. Data from each market uses a nationally representative sample apart from Mexico and India, which use urban representative samples, and Indonesia and Hong Kong, which use online representative samples. Learn more about YouGov Surveys: Serviced.
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