Consumers in fast-growing markets, where Bain found environmental concerns to be highest, including India, were willing to pay a greater premium (between 15 and 20 per cent), compared to markets like the US and the UK
Over 60 per cent of businesses surveyed are ”off track” to meet their sustainability goals, according to a report by Bain & Company, which also found that consumers are willing to shell out a premium for sustainable products.
According to the report, a large number of people surveyed in India say they have a high level of concern about environment sustainability. This could be driven by the spiking levels of pollution in major cities and the rising incidence of flash floods in different parts of the country.
Consumers in fast-growing markets, where Bain found environmental concerns to be highest, including India, were willing to pay a greater premium (between 15 and 20 per cent), compared to markets like the US and the UK.
The report further said that an Indian consumer, however, is still at an early stage of understanding sustainability and a number of related behaviours are influenced by cultural norms and financial realities.
”As extreme weather prompts growing environmental concern across the globe, new research from Bain & Company shows more than 60 per cent of businesses are off track to meet their current sustainability goals,” it said.
Progress will require a combination of technology, policy, and behaviour change, the report said, adding that an increasingly conscious base of consumers and employees may prove helpful.
To get a broad sense of environmental concerns around the world, Bain surveyed 23,000 consumers, and the results underscored the growing urgency of sustainability topics.
Almost 64 per cent of people reported high levels of concern about sustainability, and most said their worries have intensified over the past two years and that their concern was first prompted by extreme weather.
The report also revealed that a large number of people surveyed in India said they have a high level of concern about environment sustainability.
”They are seemingly driven to live or shop sustainably first and foremost by direct benefits around savings and health rather than environmental concern. Consumers express a greater interest in quality, how a product can be reused, its durability, and how it will minimise waste,” it said.
Karan Singh, Partner and head of the Asia Pacific Sustainability practice at Bain & Company, said while Indian consumers show growing interest in sustainability, there’s a noticeable gap between intent and action, mainly due to factors like high prices, limited product information and availability.
”This presents a distinct opportunity for businesses to take the lead by educating consumers and innovating to offer sustainable products at attractive prices,” Singh said.
Consumers’ willingness to pay a premium for sustainable products and baby boomers being just as concerned as Gen Z, were the other key takeaways from the report.
”As concerns grow, consumers are looking to make environmentally sound choices and are willing to pay more for sustainable products. Yet, they often run into barriers,” it said.
For instance, consumers in the US are willing to pay an average premium of 11 per cent for products with a minimised environmental impact, even as the average premium for products marketed as sustainable there is 28 per cent.
”Consumers in fast-growing markets, where Bain found environmental concerns to be highest – such as India, Indonesia, Brazil, and China – are willing to pay an even greater premium, between 15 and 20 per cent. Consumers in the UK, Italy, Germany, and France, on the other hand, are only willing to pay between 8 and 10 per cent extra,” the report said.