Coles no longer happy with the status quo

Warren, I hope that I don't sound too cynical, but the current merchandising policies of Coles seem to conflict with their mission statement of being Australia's Most sustainable Supermarket. Coles' supermarkets and Coles express are one of the biggest retailers in Australia of tobacco. One of the key Sustainable Development Goals is Good Health and Well Being, and the decision to continue stocking tobacco products by Coles is in conflict with that goal.

It appears to me that most of the current public emphasis on ESG focuses on the "E". However I am optimistic that, more quietly for now, many companies are starting to take the "S" seriously. It often takes the form of "shared value" where material social benefit good is achieved in alignment with profitability.

Warren, my comments are not so much about the substance and intention of your article but about the possible outcomes for the planet and our future generations. About 50 years ago in the UK, incentives were given to householders to install efficient heating and insulate their homes. The aim was to reduce the national energy requirement (for cost rather than climate reasons). Despite the widespread uptake of these measures, the national energy graph (domestic, commercial and industrial) continued to rise in a straight line. Analysis showed that when households saved on their energy bills, they simply spent the savings on other energy-consuming pursuits and products.
Those who install solar systems, economise on water use, buy EVs and eat less red meat will likely buy more manufactured gadgets, more clothes, travel more and fly more, while worrying about bushfires, the Barrier Reef, melting icecaps and the thawing tundra.
The human race has long ago moved from survival to subsistence to consumption and, whatever the laudable SDGs (has our coal-waving PM seen the list?) and the supermarkets’ marketing regimes, there seems to be no way of reversing, stopping or even slowing, the trend.

DougC, I agree that as we get better at reducing our energy use, we can’t just start using, buying etc more stuff, it is something I have been thinking about

That's SDG#12 Michael2. I suggest you go to the UN SDG website and look into that in more detail as part of your thinking. https://sdgs.un.org/goals Behind the 17 big ones are 169 specific targets.

While I'm here, DougC, I think that the SDG's aren't aiming for quite the same thing as that UK policy 50 years ago. Those policies made me think of the many incentives governments here have provided to people to buy a house, which have merely increased the cost of housing by raising demand! The issue is a micro policy, targeting one issue, rather than a comprehensive approach.

From another angle, the SDGs aren't necessarily about reducing energy consumption, but sourcing it from sustainable origins. They're not about reducing consumption, but actually the 'no poverty' goal would increase consumption as the poorest of the world get to eat better and have better quality housing, clothing, etc. The SDGs resulted from many years of work from a lot of people, including some brilliant economists like Jeffery Sachs. I don't think that their objectives can be quite so easily dismissed as unattainable as you believe. They're aspirational, I grant you that, but that's not a reason for the likes of Coles - and every company on the ASX for that matter - to build them into their mission statements and strategic planning.

I appreciate the engagement on this - thanks everyone. Specific responses/further engagement are:

Ramon - I get what you're saying (advertise about driving less, using less fuel) but that's not really the remit of a supermarket is it? As I said in the article, a lot of the issues raised in the SDGs are actually about government policy rather than corporate action, and that would be one of them. On this, as in many other areas, the Australian government is a global laggard - e.g. the lack of encouragement of the move to electric vehicles.

Phil Kneale - I can only suggest that you do a bit more research into the SDGs because the sort of issues you mention is actually what they're all about! That's why for me it's exciting that the 'language' of ESG is shifting towards the more positive, dynamic focus on growth - sustainable growth and development - than the defensive, risk management oriented language of ESG. Also, one thing I won't accuse Coles of in this is being self-righteous. They're actually saying, 'we have to change' not 'you have to change'. They're inviting customers on the journey, but there isn't one word in the Coles ad about what other people need to do or should do.

As for the final sentence in your comment, Phil, I think you're sort of proving my point! It's moving from the realm of just fund managers talking about these things - the companies in which they invest are starting to use this language. The open question - which I left open in my article - is whether the companies are just spruiking language, or whether they are going to do real things that have real impacts. I believe that the latter is what their shareholders are increasingly going to be looking for and keeping them accountable. The SDGs are not just 'words', but actions with measurable outcomes. I certainly hope that your cynicism about them doesn't mean that you don't want social justice as well as economic growth

'here' whoever you are, I think Jason has probably responded well enough already, but I'll just add that this is not something Coles can actually do anything about. Even if there were a two horse war in retail, which Jason has pointed out isn't the case, it's still an intense war and I will be watching very carefully whether the Coles ads have a positive consumer impact or not. That was the point of the article.

Hello.

Forgive me for reminding everyone that all around me l see nothing but more and more and bigger and better petrol guzzlers , ditto houses too large for the occupants etcetera etcera ad infinitum .

If Coles were to advertise a slogan such as " Drive Less ! " , or , perhaps , " Did You Drive to Get Here ? " ,

the ESG programme might well be better served !

Ask Todd Sampson , please .

Take care , Ramon .

Most companies seem to be promoting their ESG credentials above all else. Personally, I would prefer them to focus on providing useful products, meaningful jobs, a return for investors and tax revenue for the nation.

If companies think they can, for example, help "save the planet" by reducing their carbon dioxide output, they are free to embark on such flights of fancy. By why the self-righteous preening and boasting? What's wrong with doing good things quietly, behind the scenes?

Advertising is still designed to ultimately sell product, so presumably promoting one's self-declared ethical purity is a successful strategy. I'm sure it works for a large section of the population. But, sadly, not for me. I fondly remember the days when advertising was often amusing, satirical and politically incorrect. (At least we still have the Aldi and Aussie Lamb ads - I hope).

As well as Coles, most of the banks, insurers, tech/phone companies, car manufacturers and energy companies are on the bandwagon, spruiking their preferred Commandment(s) chosen from the menu helpfully provided by the UN.

I have a better idea: lets introduce a law where 2 participants cannot control say 50% of any given market, we would then see the 'animal spirit' unleashed and consumers in this country have competition.

ESG is a grand gesture paid for by Australian supplicants, and the squeezed farmers!

Obviously you dont know the current market shares...there is 4 main players in the market and no one has 50%. Of the market. The largest company that has a big market share is totally privately owned and they are world wide. So maybe look into it more before you just spruiking something that is far from correct.

The good thing about Coles (and other companies) publicly affirming their commitment to ESG values is that the general public (including customers and investors) can at least hold them to account to their ESG commitments.

Let's hope this is a genuinely expressed commitment, not just a "marketing ploy".

Yes, Kien, that's the hope. So far, so good, I think. The plans to power all their supermarkets via renewable energy seems to be on track and they're doing some other things such as refusing to sell single use plastic dinnerware (cutlery, plates, drinking straws, etc).

One of my main curiosities, though, would be whether it work as a marketing ploy? Will it engage with customers or will their customers actually tune out when they see ads that aren't just about grocery prices? I'll be very interested to see the data they gather about the impact of this campaign.