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Social responsibility key for top trusted brands, says UVic's business school

Canadian consumers are giving their loyalty to companies behaving in socially responsible ways as the country navigates through the pandemic, says the dean of UVic’s Gustavson School of Business.
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BCAA is one of Canada’s most trusted brands, according to the 2021 Gustavson Brand Trust Index report, released Monday. ADRIAN LAM, TIMES COLONIST

Canadian consumers are giving their loyalty to companies behaving in socially responsible ways as the country navigates through the pandemic, says the dean of UVic’s Gustavson School of Business.

“We expect all entities, all institutions, all organizations to be trying to do the right thing to help everyone,” Saul Klein said Monday as the 2021 Gustavson Brand Trust Index report was released. This is the seventh year the University of Victoria has released its trust index.

Consumers’ trust in brands is linked to authenticity, which means their belief in a brand reflects their values. Some previously trusted large brands have fallen in the rankings because consumers felt the companies’ values no longer aligned with their own, the report said.

The survey found that firms that are seen to focus too much on their own self-interest can lose the trust of consumers, Klein said.

Some organizations initially responded well to the pandemic but then backed off some initiatives, resulting in less support from customers, he said. One example is companies that gave front-line workers an increase in pay, then took it away a few months later.

“More than ever, CEOs are being viewed as societal leaders entrusted to take a stand on social issues, from climate change to addressing racial injustice,” Klein said.

“As the world climbs out of the pandemic, brand awareness is no longer the currency of business — consumer trust is the priority. There is a need for companies to rethink how they are driving positive societal change.”

During the past year, Canadian consumers have shown an acute awareness of whether a brand is truly compassionate in its activities, or its acts of compassion are opportunistic, he said.

Loyalty can change quickly. “We would expect that,” said Klein, adding this is a turbulent time. “Obviously, the interesting question is going to be whether they’re going to be sustained and will they continue.”

Klein said consumers are adopting the broader notion that organizations have a purpose that is not simply making more money for shareholders. “The purpose is to contribute positively to society.”

The 2021 Brand Trust Index surveyed 8,975 Canadians between Jan. 13 and Feb. 8. It included 391 national and global and 10 regional brands in 33 categories.

It measured overall brand trust by looking at consumer perceptions of the brand’s social responsibility, how shoppers think a brand performs its core functions, how well it interacts with its customers, and how much consumers will recommend it to others.

One B.C. brand doing well among Western Canada consumers is London Drugs, which makes sense, Klein said. It has been advocating a more responsible environmental approach in terms of recycling, it has given shelf space to local producers struggling in the pandemic, and it supports community organizations, including the Canadian Red Cross, Muscular Dystrophy Canada and the Boys and Girls Club.

Among millennials and Gen Z (ages 18 to 35), Patagonia is the most trusted brand in Canada, the report said. Patagonia specializes in outdoor clothing and gear.

Millennials are more engaged and have high expectations, Klein said.

Consumers are becoming more savvy, questioning if a company is authentic and doing things that are truly the right thing to do, he said.

Pressure to do the right thing comes not only from consumers but from employees, he said. Klein suspects that as we come out of the pandemic, staffers will take a hard look at their employer to evaluate how it performed during that time and whether they want to stay with that organization or move on.

Canada’s most trusted brands for 2021:

1. Canadian Automobile Association (CAA/BCAA/AMA)

2. Dyson

3. Lego

4. Tie: Interac and President’s Choice

6. Costco

7. Tie: Home Hardware, MEC (Mountain Equipment Company) and Quaker Oats (TIE)

10. Tie: Lactalis Canada (formerly known as Parmalat), Canadian Tire and Indigo/Chapters

cjwilson@timescolonist.com