From the data for 22/23, we have identified six trends that will affect purpose-led companies in the coming years.
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This is because these trends were fueled by factors that have decreased in effect, like lockdowns and working from home. And, in addition, there are also new, counteracting factors like decreasing purchasing power, increasing demand for truly sustainable options and desire for value-balance trade-offs between customer needs and wants.
We have identified six new trends that will affect purpose-led companies in the coming years:
The study shows that people think challenges related to being environmentally and socially responsible are some of the most important problems companies should help solve. Resources should be used responsibly, pollution and waste should be limited, and it’s important to care for people.
Green energy, sustainable food, electrification and climate-aware heavy industry are sectors with responsibility as their core business idea that score high in purpose indexes. Companies and brands that have integrated environmental or social sustainability in a value-adding proposition also score high in purpose indexes.
Increased urgency of the climate crisis and rising levels of inequality have made sustainability more important to people. An economic downturn will further the demand on care for all resources. In times of limited means, waste will become taboo.
It will be critical for companies avoid being perceived as irresponsible or heartless. Credible and transparent circular business models will be a fantastic way to build loyal customer relationships. Helping customers act on their positive intentions to consume more sustainably will be even more so.
Sweden’s most purposeful companies are seen as highly trustworthy. Companies and brands that take clear values stances through both word and action continue to score high purpose indexes.
The study also continues to show strong correlation between shared values and brand preference, indicating that having shared values is the most important thing for people to put their trust in a company or a brand.
To get there, companies must meet customers’ increasing expectations on openness, transparency and honesty. And they need to be consistent, in both good times and bad.
In the coming years of anticipated economic turmoil, the challenge will lie in building customer trust by being both relatable and staying reliable. Companies will be expected to be honest, transparent and trustworthy sources of accurate information.
In line with the globally diminishing trust in governments and institutions, Swedes have begun looking to companies to take on traditionally public responsibilities. The most purposeful companies have not just taken on these kinds of challenges, but are also leaders with a clear vision for the future.
Sweden’s most purposeful companies successfully convey an idea about what they can do for the future and act in line with that idea. Their ambition to improve conditions for people, planet or society makes people feel that these companies are important.
At the same time, we see that creating economic growth does not rank among the most important challenges for companies to solve. There is a role to play that involves being a leader for a better future and creating more than profits.
The challenges that are important for companies to solve are related to environmental problems; corruption and democracy; job creation and fair work conditions; and equality. These are all areas where Swedes have traditionally looked to the public sphere for actions and solutions, e.g. through regulation and legislation.
There is great opportunity for companies that manage to meet the general public’s expectations by stepping up and leading positive change for people, planet and society in the coming years. This is especially true because a recession could limit the individual’s room for positive action, but it would not limit their ambition.
‘Improving people’s health and wellbeing’ is a very important challenge that companies should adress. Healthcare services, pharmaceuticals and healthy food are also three of the four most purposeful sectors in this year’s study.
While these companies have a very direct impact on people’s health, more indirect contributions to health also matter – for example: a healthy work life. The single most important problem companies should help solve is ‘Offering fair work conditions’. People want a work situation that is both physically and psychologically healthy.
And safety matters. Both ‘Improving people’s personal safety’ and ‘Safeguarding people’s right to privacy’ are two additional challenges highly prioritized by the general public.
Together, this paints a picture where the general public has extensive expectations on companies’ responsibility for people’s health and well-being, no matter what industry they are in. This will only increase with growing political and economic uncertainty in the world.
Both the tendency towards de-globalizaiton that we’ve seen over the past decade and the ongoing war in Ukraine emphasize the importance of national identity, capabilities and needs. This, in turn, makes Swedes eager to support and choose local brands.
People trust what is close to them, what they recognize and are familiar with. Familiarity is simple and brings comfort, no matter if it comes in the form of a product, service or experience. Stressful times amplify this emotional effect.
Pragmatism also factors into people’s preferences in times of crisis, such as war in Europe. The societal role, function, and importance of some companies – such as local food producers or energy providers – comes to light.
Companies and brands that differentiate through purpose-led strategies based on the Swedishness as a superpower, especially those that play an important role for society, will have great opportunity to build strong relationships with Swedes in the coming years.
Heavy industry has traditionally been associated with using a lot of resources, pollution, challenging working conditions, and other negative effects on people and society. But Swedish companies in this sector have modernized on a broad scale in recent years and been quite vocal about it.
Swedish industrial corporations still have benefits like size, reliability and global ambition, but they are now also are leading technological shifts, innovating how they use resources, consciously limiting their effect on the planet, and actively working to improve working conditions.
They represent many values and skills typically associated with companies from Sweden that found success far beyond its borders. Technical innovation, sustainability, smart design solutions and humanism are highly important means of staying competitive internationally.
There’s great opportunity for corporations that dare adjust to the expectations placed on them and mindfully develop how they do business. Established companies and brands can do more than age well, they can evolve into north stars with global success.
We’ve measured how purposeful 150 companies and brands in Sweden and 430 brands globally are. Your business could be among them, and your industry definitely is.
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