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Wednesday, July 29, 2009

Should We Pick Our Customers?

I have been thinking for some time about companies including sustainability credentials in picking who they want as their customers.

I know, I know, readers who are sustainability practitioners are thinking now that they would get laughed out of town (or the office) if they went out to the sales force and told them not to do business with certain companies. But bear with me on this.

It is not a concept without precedent. Most companies ask about sustainability credentials in RFPs and many go on to include those credentials as a component of selecting vendors. With BT, in our capacity as a vendor, we certainly get asked about it all the time by potential customers and, as a subject matter expert, I am often called upon by potential customers to talk about our activities.

Obviously companies feel in a stronger position to state requirements as a potential customer than as a vendor, but from a sustainability perspective why shouldn’t it be important both directions?

Some businesses do make categorical statements that they won’t serve customers in specified sectors. Particularly in the media, PR and advertising world, plenty of companies refuse to take business from specific sectors that they do not favor (usually the traditional ‘sin’ sectors) and especially with regard to consumer advertising. Newspapers are a good example. There are many that won’t accept ads from tobacco companies.

And in an indirect way, companies in other commercial and manufacturing sectors are doing this too. By launching products that appeal to the sustainability marketplace, whether energy efficient cars and wind turbines or irrigation and cost effective healthcare products for developing countries, companies are seeking to attract customers who have an interest in sustainability.

Especially when signing a long term deal I think it makes sense to know and understand whether that customer has a long term perspective and will be around and profitable enough to pay its bills in five or ten years time. Approach to sustainability and corporate responsibility should be a good indicator of which sectors and which companies within those sectors have a long term, healthy future ahead of them and therefore are customers with whom you want to be doing business.

1 comment:

  1. This is an interesting but complex issue! Companies already make strategic choices in terms of which sectors they may prioritise and target with their products and services. It seems that a sector's sustainability issues and track record could play a part in that prioritisation. For example, if a vendor is seeking to reduce its carbon emissions, maybe it should focus its priorities and limited resources on sectors that are clearly supporting these aspirations too, rather than sectors whose economic growth may be likely to increase carbon intensity. This can help "lock in" the carbon or environmental benefits of efficiencies that are delivered. As mentioned, there is precedent elsewhere - one example would be Cooperative finance's "ethical investment" policy.
    -Mark Shackleton