New research commissioned by OpenText™ (NASDAQ: OTEX), (TSX: OTEX) reveals that consumer demand for ethically sourced products has increased during the global pandemic.
The new data – from a survey of 27,000 respondents across the globe – considers the extent to which environmentally sustainable and socially responsible business practices matter to consumers and influence their purchasing behavior. The results highlight the growing importance companies need to place on ensuring their entire supply chain operates ethically.
Demand for Ethical Sourcing Reaches New Heights
Nine in ten (88%) global consumers responding to the survey say they prioritize buying from companies that have ethical sourcing strategies in place. This is an increase of 10% from before the Covid-19 pandemic broke – when just 58% of consumers in Japan, 71% in both Canada and the UK and 72% in the US felt the same way. A growing number of consumers in each of these markets now indicate they will prioritize buying from companies with a clear commitment to responsible sourcing – 78% in Japan, 82% in the US and UK, and 86% in Canada.
The research also highlights that 83% of global consumers are willing to spend more on a product if they can be certain it is ethically sourced. Indian (94%), Italian (90%), Brazilian (87%) and Singaporean (87%) consumers rank highest in terms of their willingness to pay a premium for ethically produced goods.
“Consumers are demanding that organizations produce goods in environmentally sustainable and socially responsible ways,” said Lou Blatt, senior vice president and CMO at OpenText. “And the key to building an ethical supply chain is information. Organizations need to have the tools and technologies in place to access data from not only their suppliers, but also their suppliers’ suppliers, and make that information accessible to partners and customers.”
Gen Z and Millennials are Driving Change
The survey also revealed that almost two thirds (64%) of 18–24-year-olds would never buy from a company again if that organization was accused of working with unethical suppliers, compared to just two in five (40%) respondents aged 65 or over. Furthermore, almost two thirds (62%) of 25–34-year-olds say it is important to know where the product they are buying originated from, versus just 47% in the 65 and over age group.
Organizations Need to be More Proactive
Chris Cunnane, research director, supply chain management, at ARC Advisory Group, commented, “The OpenText research shows seven in ten (69%) global consumers believe governments need to introduce regulations that hold businesses more accountable for responsible sourcing. Laws such as the EU’s Conflict Minerals Regulation, requiring companies importing conflict minerals into the EU to conduct due diligence within their supply chain, is an example of progress. To fully earn the trust of customers, organizations must take a much more proactive stance to demonstrating their ethical credentials.”
OpenText brings thirty years of experience in facilitating the exchange of supply chain data and helping customers to create more responsible and sustainable supply chains. Already connecting more than 1 million companies and supporting 24 of the 30 largest supply chains in the world, OpenText™ Business Network Cloud allows businesses to share data in real-time, providing clear visibility into partner performance, practices, and certifications – making it easier to establish and operate an ethical supply chain.
Visit our interactive site where you can download our white paper on the survey findings and what they mean for organizations, click here to access the survey response data by country, or visit our website to learn more about how OpenText can help your organization create more responsible and sustainable supply chains.
This research was conducted by 3Gem in April 2021. Commissioned by OpenText, 27,000 consumers were anonymously surveyed globally, across the UK, Germany, France, Spain, Italy, USA, Canada, Brazil, Japan, India, Australia and Singapore.