Tony's Chocolonely: Raising the chocolate bar for industry change

For years, I’ve been supporting chocolate – and change – maker Tony’s Chocolonely to create their annual report. My kids and my colleagues love that I work for them. Because I always return from meetings with their yummy chocolate in funky flavors. Their bars are a treat, but what inspires me most to work with them is their commitment to creating positive change in the industry. Here’s my take on their key ingredients for positive change!

Crazy people raising the (chocolate) bar

Positive change usually starts with frustration about an issue plus people crazy enough to doing something about it. And this ccompany started just like that. Investigative journalists were shocked to find out how much child labor and slavery there is involved in nearly all chocolate. In 2006, in an attempt to prove that it could be done, they produced 5000 bars of slavery-free chocolate. As this first batch sold out in just a few hours, they turned the experiment into a company.  The company tagline says it all: “Crazy about chocolate, serious about people.”

Partners towards a common goal

A shift to more sustainable business practices is needed at all steps along the chain. From cocoa farmers, chocolate companies and governments, to retailers and consumers. The people at Tony’s understand they cannot transform the cocoa industry by themselves. Tony’s therefore developed a roadmap towards its mission: “Together we make chocolate 100% slave-free”.

The roadmap engages five key actors in the industry to work towards this common goal:

  • Strengthen farmers to increase their income
  • Engage the largest companies in the industry to take action in their supply chains
  • Encourage retailers to leverage their buying power
  • Push governments to adopt and enforce legislation
  • Enable chocofans to raise awareness and spread the message

Scaling up for real movement

To really engage partners along the cocoa chain, Tony’s knows there needs to be a business case every step of the way. Its own story and success provide lots of inspiration to get different parties to act.

At the launch event for its 17/18 annual report that scale became very clear:

  • Over 5,000 farmers benefit from the special premium Tony’s pays, nearly 1,000 farmers are involved in awareness-raising activities to prevent unwanted child labor and slavery;
  • The Netherlands’ largest retailer Albert Heijn announcedit will use Tony’s principles of cooperation for 100% slave-free chocolate for its very successful private label chocolate brand Delicata. World leading chocolate manufacturer Barry Callebaut supports the change process;
  • 5,000 chocofans joined the party, over 8,500 people support Tony’s mission as Serious Friends;
  • And the brand became the market leader in the Netherlands with a market share of 19%. Net revenue grew by 23% to nearly € 45 million and a net profit margin of 4.5%.

Relentless ambition for chocolate and change

Nice numbers for a company that produced its first bar of chocolate just 12 years ago… But they know there’s still a lot of work to be done. Therefore, Team Tony’s continues to work – and party – very hard to increase its own impact by expanding the business to other countries and continuing to drive collaboration in partnership with many others.


Co-creation session for a sustainable pension fund, BrightPensioen

Last May 24th, during the Bright Future event of PrightPensioen, we facilitated a co-creation session for Bright's members. We brainstormed on creative interpretations for the future of this sustainable pension fund. With a lot of post-its and an interactive app, the most innovative ideas came about. The results tasted like more co-creation!

Co-creation for sustainable business

The aim of the brainstorming session was to think together about the question: "How can Bright accelerate its member growth in to be able to pay out its members as quickly as possible?" The majority of the attendees were convinced that Bright could reach its ten thousand membership goal by the end of 2019. But... how?

The sky is the limit

In the first brainstorm round 'the sky is the limit' we invited the participants to think big, to dream. They had to imagine that they had all means at their disposal, from infinite money to the latest technologies. Fantastic and creative ideas came up. For example, one group suggested that all new members should be taken to a tropical island as a reward for their memberships. Another great idea was building an escape room where one can only get out when one has discovered which is the best pension fund to become a member at.

Back to earth

Inspired by these creative but not always realistic ideas, it was time to land some thoughts. Two 'sky is the limit' ideas could be chosen for the next round 'Back on Earth'. How can these ideas be realised with a 'normal' amount of resources? The projects and initiatives became more and more concrete. Members that had the idea of starting to give local workshops to attract new members. Opening a child pension account. Teaching lessons about pension funds at schools. Reward members with shares when they attract a new member.

Way forward

There are three main themes that Bright decided to further develop as a result of our session:

  • Member get member: "How can we reward our existing participants for their ambassadorship? After all, we prefer to spend our marketing budget on our existing participants."
  • "How do we attract more self-employed to get a pension? And especially: how do we influence procrastination?"
  • Bright customer portal. "We would like to make our member portal better, more beautiful and more customer-friendly."

Now the remaining question is: how would you tackle these challenges?


Top tips for reading sustainability reports

To mark International Literacy Day, this post is about reading sustainability reports. In 2016, the theme for International Literacy Day actually was “Reading the Past, Writing the Future”. Which is quite similar to our recent blog about transforming sustainability reporting to a tool for positive change. But that's a different story, as this blog is not about writing reports, but rather about reading them.

An ever increasing number of companies publish a sustainability report. Or integrate sustainability into their annual reporting process.  The question is, who reads these reports? And are the readers finding any use for the sustainability data and stories presented in the reports?

Who's reading?

In 2015, the Global Reporting Initiative, creators of the most widely-used sustainability reporting standards, co-authored a report with Oxfam, Informing decisions, driving change, about how different stakeholders read and use sustainability data captured in sustainability reports. It offers a comprehensive view of the key users of sustainability data, such as civil society organizations, investors, business, governments, market regulators, and media.

Some would argue that consumers also belong on that list, as well as prospective employees. Very different stakeholders with very different objectives. Yet all trying to get insights from reading the same sustainability report! Besides a few reporting geeks, many people may wonder how to best read or assess a sustainability report. So here are some tips to guide your reading!

Commitment or compliance?

The fact that a company has a sustainability report, doesn't always guarantee a real commitment to making their company more sustainable. A company may simply report only to comply with regulations. So a key thing to look for when reading a sustainability report is commitment. Is top management involved and engaged? What are they committed to exactly? How are decisions made regarding sustainability topics? The introduction to the report by the CEO or chairman is the best place to look for "commitment" signals. A great way to test the depth of this commitment is to cross-check the introduction of the financial report. If there is no mention of relevant sustainability topics there, then that commitment may not run so deep.

Connected context

The selection of topics for the sustainability strategy and report generally shows how connected a company is to its environment. So the next thing to look for in a sustainability report is a clear understanding of the company's context. Is the sustainability strategy linked to the vision and mission of the company, or is it focused on totally different topics? Are environmental and social risks and opportunities explored in relation to the business model? If you are less familiar with a specific industry, this may be hard to assess. In that case, reading parts of the sustainability reports of companies in the same industry will generate insights on the key topics.

Large companies are expected to act according to the OECD Guidelines and adhere to the UN Guiding Principles on Business and Human Rights. And all companies can use the Sustainable Development Goals as a framework to assess how their business contributes to a better world. So when reading a sustainability report, check whether and how the company references these frameworks.

When done well, companies select their so-called material topics after engaging relevant stakeholders, such as employees, clients, investors, NGOs, and communities. Through a materiality matrix, many companies plot the interests of their stakeholders against the interests or impacts of the company. That matrix and the accompanying text are my favorite parts of any sustainability report.

Completing the cycle

Sustainability is all about the future, yet reports tend to look back in time. So when reading a sustainability report, check whether the report on past performance is in function of the future. Are the long-term objectives clear, as well as the strategies and policies to reach them? Are they closely linked to the material topics identified? Does the report share relevant results for the past year as well as previous years as a benchmark? How do these results stack up against the goals for this reporting year?

Are the results balanced? Not just sharing what went well, but also the learnings from things that did not go as well? And does the report provide insight into the specific goals and action plans for the year ahead? These kinds of questions help you assess whether there is a structured, full circle approach to sustainability for the company. In which reporting is a key instrument to fuel improvement, rather than a goal in itself.

Consistency

The GRI Sustainability Reporting Standards (and Guidelines) help companies to prepare their sustainability report, but they also help the readers. Especially the GRI Content Index, which lists the standard set of disclosures for all companies and includes the material topics selected by the company. With it, the reader can easily find the pages for each topic.

And just like it's useful to scan the sustainability report of a company's peers and the financial report, it can be tremendously useful to have a look at previous reports by the same company. Is the company consistently reporting on the same material topics? If not, are there good reasons to change the scope of the strategy and report due to changes in context? Or is the company cherry picking its stories and KPIs from one year to the other, to always have good news to show?

And last, but not least, is the sustainability report itself consistent with the materiality analysis? Are the topics in the report - and the space they are given - in line with the materiality analysis? If not, it may be time to look for the page that highlights how to get in touch with the company about their report!


In search of purpose for Fairphone: the power of purpose for brands

To really connect with consumers, brands can no longer present a facade and sell. To thrive, brands need to create an emotional connection with people, stemming from a clear brand purpose. A purpose that addresses a real societal issue and that strives to create a movement to resolve this issue. In May 2017, we organized an event about purpose marketing at Fairphone, a social enterprise that makes the world’s first ethical, modular smartphone. The event was organized by the Nyenrode Business University Alumni Circle for Sustainability, in collaboration with the Alumni Circle for Marketing & Digital. Here are some of the key outtakes from the event on purpose marketing.

Creating a fair phone isn't easy

Lina Ruiz, Fairphone's strategic partnerships and events manager, kicked off with an introduction to Fairphone's mission: making a positive impact in how phones are made, used and recycled. Interestingly, she used a video by Milton Friedman  to explain the complexity of supply chains. She then shared Fairphone goal of creating positive social and environmental impact from the beginning to the end of a phone’s life cycle. They do this in four ways.

Fairphone's long-lasting design creates products that last and that are easier to repair. The design helps people understand how to get more years out of the device and move away from the mindset that consumer electronics are semi-disposable objects.

Fairphone traces where the parts come from and therefore creates demand for fair materials that are good for people and planet. One material at a time, Fairphone strives to increase awareness and source better ingredients for their devices.

Fairphone wants to improve working conditions in the electronics sector. With experts, NGOs and other partners, they develop innovative programs to improve worker satisfaction and representation. 

 

To progress towards a circular economy, Fairphone encourages the reuse and recycling of electronics. Withspare parts and recycling programs, they support both consumers and producers. 

The power of purpose for brands

Consumers are increasingly oversaturated with advertising messages. Brands constantly try to sell themselves with beautiful messages, but not all of them are authentic. No wonder the Edelman Trust Barometer shows an implosion of trust in business. At the same time, people look to business to be drivers of change for a better society. From brands, people demand something they can relate to, authenticity and higher ethical standards. The brands that succeed are therefore those that offer shared value for both society and business. That have a purpose that truly connects their business to societal issues in a relevant way. Some companies, like chocolate maker Tony's Chocolonely and transportation company AirHunters, had a clear societal purpose from the start. Tony's wants to abolish slavery in the cocoa industry. Airhunters wants to decrease the carbon footprint and congestion caused by suboptimal transportation. Their brands, therefore, radiate their respective purpose very clearly. Other older and larger companies, like Unilever and Heineken, seem to have veered further from their original purpose but are redefining purpose for their brands with great success. Year on year, Unilever's purpose brands like Dove, Lifebuoy and Ben & Jerry's, outgrow the other brands by 30%.  And Heineken's responsible consumption campaign with DJ Armin van Buren created a global movement of DJs urging people to dance more and drink slowly.

Guiding brands toward purpose

Using the purposeful positioning model developed by The Terrace, the participants then got to work on Fairphone's positioning. The model helps companies and brands find their purpose through an outside-in approach.

1) What are external societal issues that a brand can or should address, such as environmental problems, social issues, latent consumer needs, stakeholder issues and true customer needs?

2) Through the lens of those key issues, how can a brand create shared value? Where are the opportunities for impact or societal value? And how can it create business value in parallel?

3) Who are the people to engage and keep in mind? Through the shared value angle, who are the people that will use the brand? With whom would the brand compete? And which parties are potential collaborators striving for the same societal value?

4) What does the brand really stand for? What are the brand's key benefits, personality, promise and the reasons to believe? This is often more comfortable territory for the marketer.

5) Why is the brand really here? What is the brand's true purpose? The heart of the model brings together the input and perspectives from the previous steps. Once that purpose is distilled and chosen, then go back from the inside out to refine all elements in the model.

Collaboration for positive change

Combining the forces of Nyenrode's sustainability and marketing alumni and their guests, the group came up with various alternate business models. Each stemming from a different angle on the purpose that Fairphone could adopt. Therefore each leading to quite different engagement strategies and tactics. The conclusion of the evening was that there are many opportunities for Fairphone to further focus its purpose and marketing tactics. Even with limited time, the group came up with very actionable ideas, which were gratefully received by the Fairphone team. The other conclusion was that crafting purpose takes more time than the 30 minutes we had available in the context of this workshop - and that is was incredibly inspiring for all involved! Over drinks, the participants continued to talk for hours, sharing how they could put more purpose into their own brands and lives.

A big thank you to Fairphone for hosting this event, to the many people who participated so actively and to the many people involved from the Nyenrode Alumni Circles for Sustainability and Marketing & Digital. Interested in finding out more about purpose marketing, please contact Marjolein.

This blog was originally written by Marjolein Baghuis (@MBaghuis) and Tim Mazajchik (@tmaz85) for the Nyenrode University Alumni website. It has also been posted on the websites of Heartbeat Strategy and Change in Context.


What to do with unexpected clients? - And how not to lose them

“You are not really going to ride that ugly car, are you?” Since I admitted to buying a Mitsubishi Outlander I get overwhelmed by disappointed reactions from friends and family. Because they are car lovers. Petrol heads.

I get their point, but…

The diesel guzzlers they love to drive are not very sustainable and a more environmental friendly car had been on top my wish list for quite some time. The Mitsubishi Outlander seemed the ‘least dreadful’ version of all hybrid cars on the market. A little less ugly and dull than the others, so to say. Take into account the tax benefit on top of that and the choice was easy.

Reluctantly though.

Brands are part of our identity

We all have our preferences for specific brands. Whether it is conscious or unconscious. We search for a brand with features that are in line with our own desired personality. By choosing a specific brand, we are associated with a target group to which we would like to belong. While one person does not want to be associated with a Japanese car at all, the next will not stop talking about the amazing technical features of the same car.

But what if ‘your’ brand does not deliver the kind of product or product features that are very important to you? What if none of the brands you prefer offer a sustainable choice?

That will force you to step out of your comfort zone and look at another brand. This brand then has the challenge to connect with these new, unexpected clients. And to keep them, without losing their existing clients.

11.000 sold cars without test-drive (but “Mit-subsidie”)

Mitsubishi is a strong player in the hybrid car market. A few years ago, the Japanese brand said to have the ambition to focus on the production of sustainable SUVs for an affordable price. In 2020, 20% of their cars will be electric or plug-in hybrid. Electric driving will become one of the pillars of their worldwide sales strategy.

And it is already paying off, so it seems. Last year the brand took the semi-electric Outlander PHEV to the European market. Aided by the significant the tax benefit (the Dutch nickname the brand ‘Mit-subsidie’ – with subsidy) there was a big run on this car. No less than 11.000 cars were sold without the future owners even taking a test-drive.

Awkwardness in the showroom

Mitsubishi is known for its user-friendly cars for an affordable price. The dealers have adjusted their sales pitch entirely to this message. But how do you approach this new group of sustainable buyers? They clearly have no idea, so it seems when I walk into the showroom with my wallet already pulled out.

Dealers seem to be ashamed for the relative high price of the sustainable Outlander. They think it is a waste of money to pay for the extra features and have almost nothing to say about the sustainable qualities of the car. With every unanswered question, I get more uncomfortable.

The green ambitions of the management have obviously not yet reached all layers of the company.

But as long as there are no serious alternatives, Mitsubishi will profit from this situation. However, there is no reason to sit back and relax. Other European brands will follow suit with their own affordable hybrid. And if Mitsubishi’s unexpected clients still do not feel at home with their new brand, they will go straight back to their own familiar brands.

Know your customer

Bringing a new sustainable product to the market has a lot of consequences. One of them is that you may gain a new target group. The group of consumers that makes choices based on the sustainability of a brand is growing. This group is focused on innovation in the market and they like to be well informed.

As a brand you need to be prepared for this. Being the first with an innovation only gets you one step ahead on short term. If you want to keep those customers in the long run, you need to make an effort. You have to understand your customers. What motivates them? What are their wishes?

This means that your sales people should learn how to handle different target groups. Which clients is motivated by price and which clients do you seduce with the technical aspects of the product?

Learn their language. If new clients feel understood, they might (unexpectedly) become a regular client