• Tamar Makov

Consumer Perceptions: Environmental Win-Wins

With George E. Newman

Many organizations seek to align their financial goals with environmental ones by identifying strategies that maximize profits while minimizing environmental impacts. Examples of this ‘win-win’ approach can be found across a wide range of industries, from encouraging the reuse of hotel towels, to the construction of energy efficient buildings. Although win-win strategies are generally thought to reflect positively on the organizations that employ them, here we find that people tend to respond negatively to the notion of profiting from environmental initiatives. In fact, observers may evaluate environmental win-wins less favorably than profit-seeking strategies that have no environmental benefits.

We suggest that the negative response to environmental win-wins results from a fundamental psychological divide between social relationships that are perceived as communally-oriented versus those that are perceived as market-oriented (hereafter, ‘communal’ and ‘market’). Previous research has demonstrated that communal versus market relationships invoke fundamentally different norms for behavior. Specifically, when a communal relationship is established, profits can “taint” the positive value associated with pro-social behavior because they violate the norm that one should give without receiving something in return.

In market contexts, however, this norm is not present and thus it may be perfectly acceptable, and perhaps even expected, to profit from one’s actions.

Here we examine the distinction between communal and market norms in the context of environmental win-wins. In a series of experiments, we document a negative reaction to initiatives that result in both environmental and financial gains. We further identify important boundary conditions of this phenomenon and suggest ways in which organizations undertaking sustainability initiatives can avoid potential backlash.

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Experiment Results

Company evaluations by condition (control advertisement versus environmental advertisement) and benefit type (profit versus reputational).

The error bars represent standard errors.

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