We live in an age of anxiety, fuelled by the Covid-19 pandemic, surging energy prices and inflation, the war in Ukraine and the ongoing climate crisis. It is no surprise, then, that the role of brands has changed significantly in recent years.
Trust, and values, have become essential components of success for brands, according to the Edelman Trust Barometer, a survey of 32,000 consumers in 28 countries. At the start of the pandemic, “consumers asked brands to be their saviour, to protect them with affordable products while insisting on the proper treatment of employees on the front lines,” says CEO Richard Edelman. And now they want brands to continue acting to make society better, he adds.
In a world where economic optimism has collapsed – 60% of respondents say they don’t think they and their families will be better off in five years, 10 points more than a year ago, businesses are increasingly the most trusted institution – 62% of respondents said they trusted business, against just 51% for governments. But that means consumers expect more from the brands they buy, with 63% saying “I buy or advocate for brands based on my beliefs and values” and 69% saying that having societal impact is a strong expectation or deal breaker when considering a job. About half of respondents said that businesses need to do more to tackle issues such as climate change, income inequality, access to healthcare and energy shortages.
Pre-pandemic, consumers wanted brands to be stylish and low carbon. Now that is the minimum they expect. Instead, brands need to become Super-Sustainable and to create, support and exhibit “the behaviours and practices on which human wellbeing can be maintained and extended, climate and beyond”. “To meet these new expectations…it will not be enough to deploy old methods and established thinking. This is a fundamental change. It requires a fundamental redirection of focus – from sustainability to Super-Sustainability,” Edelman says.
Super-Sustainability and beer might not be an obvious match – recent research from Bain showed that brewing was one of the least successful sectors in making the sustainability connection and engaging consumers on green issues. In response, IFF, which provides enzymes that can help brewers use less water or energy, and enable the use of more sustainable, local ingredients (sorghum instead of barley in Africa, for example), organised an industry webinar to discuss what companies can do.
Brewing is a hugely competitive industry that is facing a plethora of environmental and social challenges and so it has had no choice but to act. These threats include the threat to barley crops from climate-related increased droughts and extreme heat, as well as the threat to water supplies.
Brewers are responding to the challenge with a range of strategies to win trust and boost transparency, from clean energy-powered breweries to tree planting. Here’s a few examples of what the industry is doing.
HEINEKEN aims to reach net zero emissions in its own operations by 2030 and to ensure the same throughout its value chain 10 years later. Since 2018, it has established more than 130 renewable energy projects, including solar-powered breweries. In Spain, for example, the firm has signed a deal with Iberdrola to power all of its operations and offices using solar power and it will replace its gas boilers with biomass ones.
Anheuser-Busch InBev (AB InBev), whose brands include Budweiser, Stella Artois and Corona, has set a range of sustainability goals, including improving water availability and quality in high-stress areas across its supply chain by 2025. The business is investing in emerging technology and innovation, like remote sensing and data analytics, to support its initiatives. And it is exploring the use of blockchain technology to allow customers to see where the barley in their beer has come from.
Carlsberg is taking a different route, teaming up with WWF to help restore seagrass meadows around the UK’s coast. Seagrass is the ultimate carbon sink, absorbing carbon up to 35 times faster than a rainforest. Meanwhile, Scottish craft brewer BrewDog is planting millions of native trees within a patch of forest in the Scottish Highlands. According to James Watt, the company’s CEO and co-founder, the Lost Forest project16 “is capable of pulling one million tonnes of carbon dioxide out of our atmosphere”. The company became carbon negative in 2020 and claims to be removing twice as much carbon as it emits.
The Naked Collective’s (TNC) So.Beer is brewed alcohol-free from the start. This means it isn’t boiled to remove the alcohol in the production process, and therefore retains its nutrients and no artificial flavours need to be added to replace flavours lost during the alcohol removal. All TNC cans are 100% recyclable and delivery materials are compostable or recyclable too.
New Belgium Brewing Co. was the first beer-maker in the US to sell a carbon-neutral beer nationwide. Its Torched Earth Ale uses dandelions, hop extracts and smoke-tainted water – “the kind of ingredients that would be available in a climate-ravaged future”. The aim was to shock some of the big beer manufacturers to wake up to the scale of the industry’s carbon footprint, according to CEO Steve Fechheimer.19 “The beer is a warning that continued climate inaction will have devastating consequences. If you don’t have a climate plan, you don’t have a business plan.”
In this era of Super-Sustainability, business has no time to waste, and burying your head in the sand is not an option. Heightened public expectation and the formalisation of new ESG (environmental, social and governance) requirements from investors mean beer brands must step up to the sustainability challenge like never before.