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NGOs give out praise when a business changes a policy in response to their campaign or direct criticism, or when they cite a business as a positive example to persuade/shame its peers into making the same change. From working with dozens of global businesses across all sectors that include leading consumer companies and retailers, we have seen that consumer brands and retailers (and as it happens, financial institutions) have come to see NGOs in a much more positive way than their counterparts in other sectors. More and more consumer companies are engaging with NGOs as experts or even potential partners to help tackle difficult problems like sustainability and raising supply chain standards. This positive attitude has undoubtedly in turn changed how some NGOs view big business, hence in part the willingness of NGOs to praise such businesses.
But smart NGOs also realise that business can be their most efficient route to achieving ‘real world’ reform. Getting big toiletry and personal care brands to change how they buy palm oil, or persuading food firms to demand higher animal welfare standards from their livestock suppliers, creates deep, sector-wide change faster (and more cheaply) than trying to change the purchasing decisions of millions of consumers or lobbying often remote governments for legal or regulatory change.
Just because firms are working more closely with NGOs does not mean they are exempt from their criticism. In fact the opposite is often the case, because of the ‘Champion Effect’: brands that adopt a high profile on ethical or environmental issues are praised more but also held to higher standards and expected to lead on other issues. This is why several companies are amongst the most highly praised and the most highly criticised firms in the food sector.
Also driving up NGO criticism along with praise is that brands have made more progress tackling ‘non-core’ than ‘core’ issues. While food firms have done a lot of good work in areas like sustainability and sourcing, and being praised for it, they are mostly struggling to satisfy critics on matters like nutritional content and health. This attracts criticism from NGOs, albeit not the same ones. The first company to tackle both types of issue equally effectively will surely soar to the top of our NGO praise rankings.
Moreover, with the globalization of NGOs as well as companies, brands can’t avoid becoming potential targets just because they are headquartered or operating away from the world’s traditional NGO strongholds in the West. Increasingly, companies in countries like China, Vietnam and Brazil are as much on the NGOs’ radar as those in the U.S. and Europe.
SIGWATCH tracks NGO campaigns to understand emerging issues and help business manage global activist risk. Its clients include many of the world’s leading multinationals in energy, chemicals, mining, FMCG, financial services, healthcare,retail and communications. SIGWATCH follows the campaigns of over 7,500 NGOs and their impact on more than 800 issues and more than 11,000 companies, projects and brands. Founded in 1997, SIGWATCH has offices in the UK, Germany, U.S.A. and Canada with a team of multilingual researchers operates in over twenty languages.
An executive summary of Sigwatch’s report “Corporations that NGOs loved and hated in 2015” can be downloaded free from www.sigwatch.com.
Robert Blood
Managing Director
SIGWATCH
