There is one exception: If the emissions cannot be influenced by the company, for example, if they already arise during extraction of raw materials, compensation and reduction are perceived as equivalent. “The willingness to spend more money on a climate-friendly product tends to be higher the more environmentally conscious consumers are,” says Dr. Nils Roemer (Universität Hamburg).
Recommendation to companies: Communicate green actions transparently
Studies show1: Consumers are increasingly aware of the social and environmental consequences of their purchasing decisions, and many companies are therefore already taking action and acting more ecologically. However, not all of them communicate these measures for fear of being accused of “greenwashing” – that is, of whitewashing their own activities.
Clear communication about whether and how emissions are reduced is particularly important for companies, according to the study’s results. “This allows companies that actively reduce emissions to differentiate themselves from competitors who merely compensate,” says Prof. Troester. A clear breakdown of controllable and non-controllable emission components could also be important for this matter. In addition, it can be more expensive for a company to invest in innovative processes that reduce CO2 emissions. However, the results of the study suggest that these investments may be worthwhile, as consumers are willing to pay for them.
Additional information:
The results of the study are based on an online survey with around 200 participants and an experiment with around 80 participants.
1 CDP (2019). Top FMCGs in race to keep up with conscious consumers. www.cdp.net/en/articles/media/top-fmcgs-in-race-to-keep-up-with-conscious-consumers
Nielsen (2018). Global consumers seek companies that care about environmental issues. nielseniq.com/global/en/insights/analysis/2018/global-consumers-seek-companies-that-care-about-environmental-issues/
Golob, U., & Kronegger, L. (2019). Environmental consciousness of European consumers: A segmentation-based study. Journal of Cleaner Production, 221, 1–9
Publication: N. Roemer, G.C. Souza, C. Troest and G. Voigt: Offset or reduce: How should firms implement carbon footprint reduction initiatives? Production and Operations Management https://doi.org/10.1111/poms.14017