Close-Up: Live Issue - How important is ethical marketing?

To what extent should adland accommodate ethical and environmental issues, Danielle Long asks.

The hiring of Young & Rubicam as the global agency partner for the Save Our Selves initiative to fight climate change has added weight to the debate around adland's role in the new, green frontier.

Consumers are demanding that companies get their ethical credentials in order. And with brands and clients moving faster than government legislation, there is a great opportunity for the ad industry to lead the way and help clients understand the implications of green issues on their brands.

Hamish McLennan, the global chief executive of Young & Rubicam, says the chance to take a leading position on environmental issues was a big factor behind the agency's involvement with the Campaign for Climate Change.

"I don't think anyone in the industry is leading on this. We saw it as a good opportunity," he says.

As Y&R works with MSN and Al Gore's Alliance for Climate Protection group to roll out its global message, the pressure on brands to present their own environmental positioning is likely to increase.

A study by Lehman Brothers found some businesses are already facing reputational challenges on environmental issues.

John Llewellyn, the senior economic policy advisor at Lehman Brothers, says companies are under pressure to maintain their reputation in this green-focused market.

"Those that are looking to make changes, and make an investment in environmental policy, will survive and prosper," he explains.

But he does warn against superficial green businesses, and says brands have a lot to lose if they are not genuine about the issues.

Greg Nugent, the marketing director of Eurostar, says brands will look to agencies for guidance. "They need to talk to their clients to help them understand the importance of this issue," he says. "It's not only something we need to do morally, but it's also a chance for clients to reconnect with consumers."

The chief executive of TBWA\London, Matt Shepherd-Smith, agrees. He says: "Businesses that are proactive will gain ground over reactive ones. Marks & Spencer is a great example. It has worked out how to spread a positive message and has been admired for it. Our job as agencies is to help our clients articulate to consumers what the brands are doing and help show what they can do."

The sustainability debate also represents business opportunities for agencies as new revenue streams grow out of clients' needs to communicate their green credentials.

Ad agencies could also benefit from new-business wins off the back of their own green credentials, as clients look to work with companies whose ethics echo theirs.

Iain Patton, the managing director of Satellite, an ethical marketing agency, says public sector companies have started to ask suppliers to disclose environmental policies.

"Some clients are starting to differentiate agencies on the basis of experiences in communicating sustainability messages," he says. "There isn't a lot of pressure at the moment, but it will become a key differentiator."

Archibald Ingall Stretton claims it is already winning new business through its green credentials. Stuart Archibald, the managing partner, says: "We know a number of big clients who are choosing agencies that reflect a similar environmental position as their own. We see it as a business opportunity, as well as a moral objective."

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NETWORK CHIEF - Hamish McLennan, global chief executive, Young & Rubicam

"People have become more savvy and the proliferation of the internet means they're more aware of those companies that are doing good things in these areas.

"Agencies have to be in line with consumer sentiment; any good agency needs to lead clients and have a point of view.

"I'm not saying we have all the answers, but this is about making a contribution by trying to change the way people think and act.

"We're going to see government pitches and certain corporations that will want to know a company's position on carbon neutralities and how environmentally friendly it is. This will become a central tenet to the pitch process over the next few years."

CLIENT - Greg Nugent, marketing director, Eurostar

"The worst thing a brand can do is to spend lots of money telling people how green it is. This 'green wash' is one of the biggest threats we have as an industry.

"The public is very cynical, and if companies can't back up their claims, the public will lose trust and think we are just engineering green.

"For agencies, green policies can help clients understand that a business has morals and ethics. Agencies that see the substance, and are genuine about their environmental positioning, will be the pioneers within the industry. It will also help them stand out. So many agencies effectively do the same thing, this will help them capture clients' attention."

CREATIVE CHIEF - Neil Henderson, joint managing director, St Luke's

"Hardly any clients are asking about our environmental policy at the moment. I would've thought that clients would be pushing more to work with green agencies by now, but we aren't finding any pressure about this.

"I think it's a case of clients getting their house in order before they start asking the same of their suppliers. I think we'll see some big companies put in place corporate strategies to sort out environmental policies. There's a general sense in the industry that it's time to do something; over the next 12 months, the pressure will be on."

DIRECT CHIEF - Stuart Archibald, managing partner, Archibald Ingall Stretton

"When it comes to positioning the environment as part of a broader business strategy, agencies have a great opportunity to show clients the way.

"But when it comes to environmental issues, our own industry's lethargy is surprising. Why have so few adopted emission reductions for their own businesses? It's hardly credible to advise a client on the subject if your own organisation is failing to walk the walk. Counting the agencies that have gone carbon neutral, or have implemented their own CSR policies, doesn't take too many fingers. Of even greater concern, though, is the fact agencies' thinking also lags behind that of consumers."