In the first in a series of new blogs, we explore the legal implications of growth. This follows the launch earlier this year of our in-depth report, Ambition 2025 [link], which looked at the drivers for growth of North West businesses – their strategic objectives for the year, the challenges that lie ahead and the opportunities that exist in their quest for success. The report dived into a number of core areas that feature prominently in the growth ambitions of regional businesses. This includes finance, people, innovation and sustainability.

We kick off the first of four blogs by focusing on the key topic of sustainability, speaking to associate partner, Bill Dunkerley, about its importance and what businesses need to consider from a legal perspective when scaling up.

The importance of sustainability

The topic of sustainability has raced up the business agenda in recent years, as global economies introduce stricter regulations and place greater emphasis on climate change, sustainability and the environment.

“Sustainability is definitely the word of the moment,” explains Bill. “While it means different things to different people, there’s no doubt that it’s a critical concept.”

Unlike many other business concepts that emerge along the growth journey, Bill insists that sustainability is a day one job, if not before. “It’s not a one-off activity or mindset,” Bill explains. “It’s something that businesses should be considering before the company is even up and running. After launch, it then becomes a continual process of reflecting on what you’re doing and constantly asking, ‘can we do things better?’.”

Key legal considerations

By its definition, the word sustainable means ‘maintaining a certain rate or level’. In order to do this, Bill says it’s essential for businesses to understand the changes being implemented by the government, whether that’s around net zero, greenwashing, or the transition to electric cars. “It’s all about horizon scanning and seeing what’s coming down the line, before positioning your business in anticipation of those changes, rather than being behind the curve.

“For example, while there are still questions around the move towards electric vehicles, the direction of travel is very clear. As such, businesses that operate fleets need to start thinking now about that transition, because there will be a capital and investment cost attached to that change. It’s impossible to simply do it the day before diesel engines are banned. You need to be looking ahead and factoring these changes into your business plans to best position yourself for the future.”

Compliance with evolving and emerging legislation is also a vital consideration for businesses when it comes to the issue of sustainability.

“Compliance is of critical importance,” explains Bill. “It’s hugely important to have a mechanism in place that enables you to monitor what is coming down the line and understand what legislation already exists, such as the Environment Act. This is a fundamental piece of legislation, which includes many provisions that will have a real impact on businesses, including the plastic packaging tax.”

When you take sustainability back to its true meaning, another area of consideration is around people. “The sustainability of your workforce is crucial when it comes to growth,” explains Bill. “This will differ from sector to sector, business to business, depending on what the nature of the work is. But the issue around mental wellbeing will only gain momentum, with the Health and Safety Executive (HSE) trying to raise awareness and educate businesses around mental health in the workplace.”

To date, the HSE hasn’t pursued, investigated or prosecuted any business for offences relating to mental health-related injuries in the workplace. However, Bill believes that once the education phase is complete, enforcement will follow. “Yes, you want to keep your workforce happy and motivated,” says Bill. “But, equally, on the regulatory front there is going to be an increasing focus on mental health, what employers are doing to protect their workforce, and how they are guarding against mental health injuries.” 

Support and guidance

When it comes to support and advice, where can businesses go if they want to discuss the issue of sustainability, in support of their growth ambitions?

“There’s a lot of information out there,” admits Bill. “Businesses need to be mindful of that and ensure any information, website, or company is verified.

“Any government website, or certain government departments, are probably the best places to start, as they will lay out what official plans are place in a given area.”

The other meaningful approach is internal listening, insist Bill. “Employee consultations are a powerful tool,” he explains. “By simply asking questions, such as ‘what can we do that’s more sustainable’, you can gain useful insight on more practical areas of sustainability, such as waste management and office-based environmental initiatives.”

If you would like to speak to Bill in more detail about the role sustainability plays in your growth strategy, contact him on bill.dunkerley@pannonecorporate.com or call 0)7920 237681

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Yesterday’s ASA (Advertising Standards Authority) report on influencers highlights that over a three-week period, 65% of the Instagram stories monitored (over 15,000 stories) were not clearly labelled and identified as advertising content (as required by the CAP Code).

This ASA report has put influencers promoting products on social media back under the spotlight as so many have failed to meet the compliance standards required. The headlines focus on the fact influencers may be named and shamed if they don’t comply, but what does this mean for the brands and retailers that build campaigns around these partnerships?

 

The background

The code requires that any paid for advertising is clearly labelled with #ad or similar and social media companies have introduced tools to allow brands to advertise more transparently on their platforms, such as through the “Paid partnership” tag on Instagram. For a while, it did seem that celebrities and influencers were using the ad hashtag, after a few high-profile mistakes, but this has clearly fallen off the radar in recent times, at the same time as massive growth in this form of advertising.

The main issue is the huge disconnect between the ASA focus on protecting consumers from subliminal advertising and the influencer’s priority of maintaining an “authentic” image that is not tainted by sponsorship. The appeal of these social media pages is that they give followers an insight into the “real” life of the influencer or celebrity, which is aspirational and which many followers will want to emulate. If the followers realise that the content is only being promoted due to the financial relationship with the advertised brand, the content will naturally lose some of its appeal. In turn, this can lead to the influencer losing followers and this diminishes their appeal for other brands. It’s a bit of a vicious circle.

 

What does it mean for brands and retailers?

In the early days, big brands worked very closely with any talent representing their brand to ensure that the content they pushed out set the right tone and was compliant. Brands have moved away from this with influencers, most likely due to the push by influencers to maintain control of their channels and their image. In turn, brands have likely left responsibility for compliance with the influencer, which is not always the best move. Brands should consider doing their own due diligence on an influencer’s track record for compliance as part of their partnership campaign planning.

 

Brands have a lot to lose by picking the wrong influencer and falling foul of the CAP Code. Consumers often put a lot of trust in the accounts they follow and if they feel they have been misled or manipulated, they will quickly switch off from the influencer and the brand. It can be very difficult to come back from online setbacks as numerous brands have shown; but well targeted campaign can be hugely successful. Over the coming months, expect to see more collaboration and guidance from brands with influencers to make sure they hit the right mark. But if the media spotlight moves on to something else, you can expect to see these practices slipping back in.

 

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