U1.10 — Environmental Issues and Business Image
Overview
Dotpoint 10: Positive and negative impacts on business image of environmental issues
This dotpoint looks at how environmental issues can improve or damage a business’s public image. It focuses on:
- Climate change
- Pollution
- Energy use
- Animal testing
These issues matter because customers, employees, governments, and local communities notice how responsibly a business operates — especially in WA, where mining, energy, tourism, and coastal lifestyles are closely connected to the environment.
Climate change
Climate change is linked to rising global temperatures and more extreme weather. In WA, that can mean hotter summers, heatwaves, bushfire smoke, and weather disruptions that affect deliveries, events, and tourism. Businesses are judged on whether they reduce emissions, make realistic plans, and communicate honestly (not just big promises).
Pros (controlling the issue)
- Trust + credibility: customers respect businesses that reduce emissions and show proof (not just slogans).
- Stronger loyalty: values-based customers stick with brands that do real action.
- Better stakeholder relationships: communities, investors, councils and staff are more supportive.
- More resilient operations: planning for heat and disruption improves reliability.
Examples (WA / Australia + international)
- Fortescue (WA): its clean energy focus has become part of its public image as a “transition” company.
- Rio Tinto (Pilbara): when the company sets targets and reports progress clearly (because communities and investors are watching), it can build trust and protect reputation.
- Patagonia (international): known for strong environmental positioning; credibility drives loyalty and word-of-mouth.
Cons (not adhering / ignoring the issue)
- Reputation damage: “doing nothing” can make a business look careless or out of touch.
- Greenwashing backlash: big claims with weak evidence can trigger media scrutiny and customer anger.
- Disruptions hurt service: heat/smoke/storms can reduce trading, cancel events, and disrupt supply.
- Hard to recover trust: once people think a business is misleading, loyalty drops fast.
Examples (WA / Australia + international)
- Santos (Australia): faced a high-profile “greenwashing” court challenge about climate claims — even defending a claim puts reputation under a spotlight.
- Volkswagen (international): the emissions scandal (“Dieselgate”) is a classic example of reputation damage from misleading environmental claims.
Pollution
Pollution is harm to air, water, or land (smoke, chemicals, plastics, wastewater, litter). In WA, pollution is highly visible near beaches and rivers and around industrial zones. If locals feel a business is making the area dirtier or unsafe, the brand can be damaged quickly.
Pros (controlling the issue)
- Cleaner, responsible image: strong waste and clean-up practices build community trust.
- Less community conflict: fewer complaints about smells, smoke, litter or runoff.
- Lower legal risk: meeting standards reduces fines and investigations.
- Positive local attention: visible actions (recycling, clean-ups) often get shared.
Examples (WA / Australia + international)
- Containers for Change WA: cafés and venues that promote it can build “community-minded” reputation.
- Keep Australia Beautiful (WA): businesses partnering with litter prevention efforts gain goodwill.
- Unilever (international): packaging and waste commitments are central to how many consumers judge the brand.
Cons (not adhering / causing pollution)
- Backlash spreads fast: one photo/video can damage reputation instantly.
- Loss of customers: people avoid businesses seen as dirty or harmful.
- Cost blowouts: clean-up, fines, compensation and lost sales.
- Staff morale drops: employees don’t want to work for a business with a bad name.
Examples (WA / Australia + international)
- Clorox (Australia): faced ACCC greenwashing proceedings about environmental claims — shows packaging/pollution claims can be legally risky.
- BP (international): Deepwater Horizon is a well-known example of how major pollution events can severely damage brand trust.
Energy use
Energy use is how much electricity and fuel a business consumes. In Perth, energy is very visible because air-con runs hard in summer and power costs can hit businesses quickly. Customers often judge whether a business looks efficient (solar, LEDs, smart systems) or wasteful (lights/AC on unnecessarily).
Pros (controlling the issue)
- Lower costs: efficiency reduces bills and helps keep prices stable.
- Modern, responsible image: solar and efficiency are simple “proof points”.
- Competitive advantage: “low-waste/low-energy” can be a point of difference.
- Staff pride: employees often respect workplaces with practical sustainability.
Examples (WA / Australia + international)
- Synergy (WA): renewable energy options and solar conversations make energy choices public in WA.
- Wesfarmers (Australia): large retail brands are judged on store efficiency and visible sustainability actions.
- Google (international): has made 24/7 carbon-free energy goals part of its reputation as a “cleaner” tech company.
Cons (wasteful / high energy use)
- “Wasteful” reputation: customers see the business as careless or outdated.
- Higher prices: inefficiency increases costs which often flow into prices.
- Bad reviews: people comment about obvious waste (AC blasting, doors open, lights on all day).
- Harder to attract staff: younger workers often prefer responsible employers.
Examples (WA / Australia + international)
- Major shopping centres in WA (e.g., Westfield Carousel / Karrinyup): customers notice sustainability features (or the lack of them) because centres are big energy users.
- Large venues (e.g., RAC Arena): energy use at big events is visible; waste can trigger criticism, while upgrades can build goodwill.
- Amazon (international): regularly scrutinised for the energy use of logistics and data centres — showing that “big power use” attracts attention.
Animal testing
Animal testing is an ethical issue most visible in cosmetics, skincare, and household products. Customers judge whether “cruelty-free” claims are real, and whether the brand is consistent across its supply chain (not just marketing).
Pros (controlling the issue)
- Ethical brand image: cruelty-free positioning attracts values-driven customers.
- Higher trust: clear, honest labelling reduces complaints and returns.
- Competitive advantage: ethical values become a point of difference when products are similar.
- Positive word-of-mouth: customers recommend brands that align with their beliefs.
Examples (WA / Australia + international)
- MECCA (Australia): shoppers often ask staff about cruelty-free brands — store reputation depends on clear answers.
- Priceline Pharmacy (Australia): customers compare “cruelty-free” options on shelf and switch quickly.
- Lush (international): has built brand reputation around ethical values and activism.
- The Body Shop (international): widely associated with ethical branding and anti-animal-testing campaigning.
Cons (not adhering / linked to animal testing)
- Backlash + boycotts: customers can stop buying and tell others to avoid the brand.
- Influencer “call-outs”: social media can shift public opinion quickly.
- Retail risk: stockists may reduce range to protect their own image.
- Trust collapses fast: if a cruelty-free claim is questioned, reputation takes a hit.
Examples (WA / Australia + international)
- MECCA / Priceline (Australia): if customers believe a product claim is misleading, they often leave negative reviews for the retailer too (not just the brand).
- PETA (international): campaigns can rapidly shape consumer opinion about brands’ animal testing policies.
- Any global cosmetics brand with unclear cruelty-free policy (international): being labelled “not cruelty-free” can damage reputation even if the product quality is good.
🎧 Prefer listening?
If you prefer listening to the content in Podcast format:
🎥 Prefer watching?
If you prefer watching the content in video format:
Biz Fact: “Greenwashing” gets called out hard in Australia. If a brand advertises itself as eco-friendly but doesn’t back it up, Aussies (and the media) are quick to label it as fake.