Companies that remain silent on controversial topics risk damaging their long-term reputation.
Businesses are in a unique position to address important issues, as customers' trust in the government and media outlets dwindles. According to Edelman's Trust Barometer report, 61% of customers regard businesses as a reliable source of information.
Companies that want to build trust must go beyond reactive corporate social responsibility (CSR). With more consumers expecting businesses to address issues like climate change (52%) and economic inequality (49%), brands must implement ethical practices to drive profits. More than 50% of consumers buy from or advocate brands based on their beliefs.
Brands should take a proactive stance on issues to connect with their customers, employees, and other stakeholders. However, organisations should be aware of the risks involved in brand activism, to avoid making bad decisions and mismanagement.
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[3 minute read]