A new research initiative will focus on addressing the gap between growing consumer awareness of climate change and the lack of widespread changes in consumer behavior, a phenomenon known as the ‘say-do’ gap. Investcorp, a leading global investment manager specializing in alternative investments, is partnering with the Saïd Business School, University of Oxford to support this research, working in collaboration with researchers at the Digital Data Design Institute at Harvard (D^3). The research aims to generate new insights into consumer attitudes towards climate change for business, policy makers, academia and the broad investor community. As part of this initiative, the group released a new whitepaper, “From Green Hearts to Green Carts: Bridging the Say-Do Gap for Climate Conscious Consumption,” published on the eve of COP28 taking place in the United Arab Emirates, where Investcorp is a sponsor.
“We are delighted to be launching this partnership with the University of Oxford to better understand one of the biggest x-factors in solving our climate challenges – consumer behavior,” said Rishi Kapoor, Co-CEO of Investcorp. “These insights will help the private sector develop effective products, services and marketing strategies to reduce consumption-related emissions,” he added.
At approximately 60 percent, household consumption is the largest component of global GDP followed by corporate investment, government spending and net exports. Consumers in industrialized countries are responsible for 70% of the environmental impacts of housing, transport and food. A small change in consumer choice could therefore make a significant and immediate impact in mitigating emissions and moving economies toward the decarbonization targets laid out in the Paris Agreement.
“As the impacts of climate change hit closer to home, consumer attitudes are also changing with greater recognition of climate risk and greater understanding of sustainability and climate topics”, said Amir Amel-Zadeh, Associate Professor at Saïd Business School, University of Oxford. “However, despite growing consumer awareness, this has not yet translated into widespread changes in consumer behavior. Understanding the contributing factors of this attitude-behavior gap is critically important to addressing climate change.”
The new white paper outlines a number of key findings:
- On average, the link between environmental awareness and pro-environmental behavior appears to be relatively weak. This finding suggests that while awareness is an important factor, it may not be the sole driver of eco-friendly actions.
- Financial constraints are often seen as the main hurdle to bridging the say-do gap, with the price of climate-friendly products being the biggest factor in consumer purchasing decisions.
- Beyond the financial cost, it is often considered “too hard to be green,” the perception that it requires significant effort to identify climate-friendly options in the first place, which suggests greater efforts may be needed to make “going green” appear easy and attainable.
- Consumers have growing reservations towards green products, aggravated by a rise in greenwashing, indicating that consumer trust in companies’ environmental claims significantly influences consumer decisions and can be undermined by greenwashing, making it imperative for companies to be transparent and authentic in their sustainability efforts.
Investcorp is supporting research at Saïd Business School in collaboration with researchers at the Digital Data Design Institute at Harvard to run a large-scale international consumer survey, with the aim of conducting further research to enhance global understanding of consumer attitudes and behaviors towards climate-friendly products and services.
The white paper is authored by Amir Amel-Zadeh who is Associate Professor at Saïd Business School, University of Oxford and director of the Oxford Rethinking Performance Initiative. Amir’s research broadly investigates the role of financial and non-financial reporting in capital markets and how companies’ sustainability characteristics affect investors’ asset allocation decisions. Co-author Qiaoye Yu is the Oxford-HEC Montréal Research Fellow in Sustainability at Saïd Business School. Qiaoye’s research can be broadly summarized as understanding how climate change affects the decision-making of stakeholders.
For more information, download the complete white paper here.