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Sustainability in retail: Five key trends driving the demand for responsible business

Sustainability in retail: Five key trends driving the demand for responsible business

Sustainability has evolved from a niche consideration to a core business strategy, especially in the retail sector. As consumers grow more aware of the environmental and social impacts of their purchases, businesses face pressure to show responsible practices.

A 2023 McKinsey report revealed that 60 per cent of global consumers are willing to pay a premium for sustainable products, indicating a shift toward ethical consumption. As this demand expands, retailers have to adapt to stay competitive. One effective way to integrate sustainability is through an assessment advisory for responsible businesses.

This article explores five trends behind the rising demand for sustainable business practices, with a focus on EcoVadis assessments as an example, and how working with a consultant can help businesses navigate sustainability.

1. Sustainability as a consumer priority

Consumers began to prioritise sustainability when making purchases. NielsenIQ found that about 73 per cent of global consumers were willing to change their habits to reduce environmental impact. This demand pushed retailers to rethink models, from product sourcing to waste reduction. To remain relevant, businesses needed to meet consumer demands and show transparency in their sustainability efforts.

2. EcoVadis assessments: A tool for corporate transparency

As sustainability became a focus for consumers and investors, companies looked for reliable ways to assess and report environmental, social, and governance (ESG) performance. EcoVadis assessments have gained traction as a method for measuring sustainability, evaluating organisations across environment, labour and human rights, ethics, and sustainable procurement.

For companies aiming to improve their sustainability standing, partnering with an EcoVadis consultant has assisted in streamline the process. These experts offered assessment advisory to guide businesses in identifying gaps, refining practices, and achieving strong sustainability ratings. Through these assessments, businesses could benchmark performance, find areas for improvement, and demonstrate their commitment to responsible practices.

3. The rise of circular economy practices

The circular economy — emphasising reuse, recycling, and minimal waste — has reshaped the retail industry. According to the Ellen MacArthur Foundation, the global circular economy market could reach $4.5 trillion by 2030. Retailers increasingly adopted circular practices, such as product take-back programs and redesigning products for longer life cycles. Assessments helped track and improve the impact of these efforts, ensuring retailers met consumer expectations and contributed to a more sustainable future.

4. Regulatory pressures and compliance demands

Governments introduced stricter regulations to address climate change and hold businesses accountable for ESG impacts. The European Union’s Green Deal and the UK’s net-zero targets pushed companies to align operations with sustainability goals. Retailers had to meet these regulatory demands or risk penalties and reputational harm. A report from PwC showed that 69 per cent of companies were preparing for new environmental regulations.

5. Sustainability as a competitive advantage

Sustainability emerged as a key differentiator in the retail market. Retailers with strong ratings attracted investors, built customer loyalty, and formed strategic partnerships. Companies such as Patagonia and IKEA showed that being environmentally and socially responsible could improve both the planet and business performance. Assessments helped companies enhance their reputation, show accountability, and gain a competitive edge.

Conclusion: Next steps for retailers

Demand for sustainable products and practices proved to be more than a passing trend — it became a shift in how consumers, investors, and stakeholders viewed businesses. Retailers that embraced sustainability and built it into their operations were better positioned to thrive. EcoVadis assessments, along with guidance from expert consultants, offer a clear path to measure performance and improve practices.

By committing to strong sustainability standards and working toward top environmental scores, retailers could seize new business opportunities, strengthen stakeholder relationships, and contribute to a more sustainable future.

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