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The Next Economy
The Future of Sustainable Enterprise

COVID-19 accelerated a shift from “me” to “we”; and a new trend called "caremongering" not only characterizes people's behavior towards each other, but what they look for in the companies they support. At Fjord, we believe those companies designing with the benefit of all life in mind will thrive now and in the decade ahead.

Transforming a complex supply chain to be more sustainable can seem daunting and even unnecessary to some businesses. COVID-19, which has led to a significant increase in e-commerce activity, has added even another layer of supply chain complexity that executives must grapple with while considering how to change consumer habits. But as people begin to shift from a “me” to “we” mindset — brought into stark relief by the pandemic — organizations must stay relevant by designing with all life in mind.

As designers, we must embrace a broader, more holistic, systems mindset — with particular attention to a growing trend that the pandemic has unearthed, called "caremongering" — a new word for looking after your extended community, beyond your immediate neighbors. Ultimately, what is good for the planet and communities is also good for brands, as consumers continue to invest in brands that honor their values.

At Fjord, we call this trend “life-centered design,” which we highlighted in our annual Fjord Trends Report. We understand how this fundamental change in perspective benefits the environment, enhances consumer satisfaction and impacts brands’ bottom lines. Designing for two sets of values — personal and collective — is critical. COVID-19 only accelerated an increasing shift from “me” to “we.” At Fjord, we believe those designing for all life in an ever-complex world — with their long-term impact on the planet and society top of mind — will thrive now and in the decade ahead.

Whether it’s CEOs declaring the need to redefine capitalism and eliminate shareholder primacy, the drastic shift in how we act in a post-COVID world, or even the climate movement sparked by Greta Thunberg, there is a re-examination of fundamentals regarding the place and purpose of governments, businesses and individuals in society. We anticipate that many people — enabled by social media — will continue to exert pressure on organizations to redefine their success in ways other than financial growth.

Helping purpose to permeate ...

Hear more from Tetra Pak's Larine Urbina and VF Corp's Ricardo Caceres on how to drive purpose, growth and impact at enterprise-level scale at SB'21 San Diego — October 18-21.

Our focus has shifted to what’s in it for the customer and their collective cause across the political spectrum — a shift we’re seeing across industries; a recent Accenture Strategy study found that 94 percent of CEOs believe that sustainable and/or a desirable products or services also make business sense. For example, US skincare and cosmetic business Beautycounter published “The Never List,” highlighting the toxic ingredients eliminated from its products. And French food giant Danone launched Manifesto Ventures, which partners with a community of disruptive entrepreneurs focused on creating a healthy and sustainable food future.

Purpose-driven organizations

Additionally, during this unprecedented pandemic, consumers are watching to see how brands are contributing to societal, economic and environmental progress. Regardless of size, businesses are quickly realizing the importance of investing in purposeful strategies that prioritize sustainability and give back to the environment, as these topics are top of mind for consumers when they make purchases. Simultaneously, shareholders are demanding environmental, social and corporate governance as it drives growth, market share and profitability.

Despite pockets of progress and innovation since the Sustainable Development Goals were agreed to in 2015, socioeconomic, geopolitical and technological uncertainties over the past four years have significantly distracted CEOs’ sustainability efforts. But investors, customers and employees continue to urge organizations to reconsider their view of the world.

The pandemic has forced CEOs to demonstrate their commitment to purpose-driven business through relief efforts, including how they treat employees and whether their business is able to realign priorities to meet public health needs. At the onset of the pandemic, companies such as Pernod Ricard, LVMH and BASF were prime examples of this mindset — and among the many companies to swiftly pivot to producing vital products such as hand sanitizer.

Today, stakeholders beyond just investors are demanding their employers be more purposeful and ethical. And many large organizations are listening. In September 2019, the Financial Times introduced "The New Agenda," stating: “The long-term health of free enterprise capitalism will depend on delivering profit with purpose”. Soon after, BlackRock — the world’s largest asset management firm — confirmed a global partnership with the Ellen MacArthur Foundation to launch its first circular economy fund.

This demonstrates how a growing number of business decisions are placing a strong emphasis on purpose, not just profit.

Growing social consciousness

Now, consumers’ spending habits are based off their interests, beliefs and personal values. Given the variety of ethical brands in the marketplace, companies that fail to adapt to this new standard will be left behind. Many consumers walk away when disappointed by a brand’s words or actions on a social issue — but the ones that have acted, for example, to authentically address racial injustice in the weeks since the murder of George Floyd are likely to see renewed customer loyalty.

Not surprisingly, socially conscious millennials believe that corporate social responsibility is the key to alleviating poverty and improving overall quality of life. In fact, 79 percent of millennial employees are loyal to companies that care about their impact on society. Patagonia has publicly stated it is in business to save the planet. The company has always been a leader in corporate social responsibility trends and is in a unique position to link its business goals with environmental ones.

We are witnessing this across industries. Recent data confirms that consumers frequently consider a corporation’s values and commitment to social and environmental sustainability when choosing brands and products. Food giant Sodexo, for example, factors in its progress in reducing food waste when calculating success. We are anticipating a watershed moment when the cost of a product or service is redefined to incorporate sustainability factors, as well as the financial cost of generating it.

The sustainable products market

It’s impossible for retailers and brands to ignore the rising popularity of sustainable products from a market perspective. The argument that natural resources are finite and the planet cannot support limitless growth is compelling. To be clear, this is not a question of sustainability versus profit, but an essential strategy to staying in business.

The sustainable products market is growing exponentially and is estimated to hit a whopping $150 billion in sales in the US by 2021. A 2019 study from NYU Stern’s Center for Sustainable Business found that 50 percent of consumer packaged goods growth from 2013 to 2018 originated from sustainability products. And while resources become increasingly scarce in the physical world, those in the digital world are limitless — so long as we have the renewable energy to power them.

Looking ahead

As we look ahead to the next decade, we recognize that consumer spending habits will continue on their trajectory from “me to “we,” which will also be informed by the legacy of COVID-19. The future sustainable enterprise is dependent upon how organizations and their leadership teams identify and execute a strategy serving their self-interest — along with that of their customers and employees. The “value add” that marketers have sought for decades is changing shape rapidly, linked to unpredictable but salient forms of self-actualization.

At Fjord, we feel optimistic about the evolving landscape of purpose-driven business. As the pandemic has demonstrated, people’s sense of community has been given a much-needed boost. The swift emergence of “caremongering” is likely here to stay, and it is imperative for designers and business leaders to take heed.


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