Companies should not only ask themselves how to win the Millennial and Gen-Z generations as consumers, as they are set to represent the majority of consumers in the future, but also how to win the intellectual capital of this generation.
When the Fridays for Future school strikes for the climate started 18 months ago, the movement was not only celebrated – encouraging awareness and gaining a mass following – there was also harsh criticism of the movement and the supporters. Their primary concern: to take the statements of the world’s leading scientists seriously and to immediately adapt our existing routine to avoid climate change. This was not taken seriously at the time, but was seen as a rebellion of the youth.
The movement was directed at leading corporations. The ongoing protests finally resulted in the business elite recognising the role that they play in climate change, and the consequences of their actions on a global scale.
The majority of the demonstrators for the movement in Germany were from younger generations reported to have come from academic backgrounds, holding at least a high school diploma or studying for a degree, according to the Heinrich Böll Foundation. Interestingly, Yale University estimates that 73% of Millennials and Generation Z are concerned about global warming. This is also confirmed by a survey by Amnesty International, which states that climate change is the most important problem facing the world for these generations.
Larry Fink, Founder, Chairman and CEO of BlackRock, issued a call to the industry earlier this year to confront climate change, increasing the number of initiatives to mitigate the company’s impact upon global warming. The environmental problem is now considered a serious economic threat – resulting in a number of companies to reconsider and alter their current prioritised objectives. The demand is supported by a study by McKinsey, which predicts a loss of hundreds of millions of lives and trillions of dollars in economic power as a result of climate change. As such, the Business and Sustainable Development Commission predicts the growth of 380m jobs being created by 2030.
Companies should therefore not only ask themselves how to win the Millennial and Gen-Z generations as consumers, as they are set to represent the majority of consumers in the future, but also how to win the intellectual capital of this generation. The ecological footprint of a company plays a major role in the decision of which company a candidate chooses. Therefore, companies that are committed to a sustainable and ethical approach with regards to production and supply chains, and have an agenda that aims to reduce the company’s impact on climate change, will have a competitive advantage over those that simply carry on as before.
Businesses that fail to adapt to this change will lack the talent to survive in the market in the long term, as barring change will no longer be defended on the grounds of economic feasibility – as stated by the McKinsey report. The mere intention or announcement to operate more sustainably will not be enough to attract this generation. Only those who are able to demonstrate clear results and true desire to change will be able to stand up to critical issues.
As a result, there has been a growing trend of companies that are developing strategies along the production and supply chains to limit the effects of climate change. For instance, the consumer goods giant Unilever, has committed to a range of sustainability initiatives – joining the Carbon Pricing Leadership Coalition, the United Nations Global Compact and the RE100, to name a few. Other major companies such as Coca-Cola, IKEA and Nike have also made 100% renewable energy commitments. Additionally, PepsiCo has identified climate change as a business risk in its Integrated Risk Management Framework.
A quote by Walter Fisch: “Do good and talk about it”, underlines how important employer branding will be, particularly across social media and targeting the younger generations, in order to reach the relevant target group. It is then up to the younger generations – Generation Change – from demand to creation, to ensure long-term success with their manpower.
BlackRock CEO Larry Fink puts climate change at center of megafund’s investment strategy
Business Commission Report
McKinsey | Climate risk and response: Physical hazards and socioeconomic impacts
Unilever | Global climate action