Informed Decisions Culture Sustainable Brands

Small Is Not Always Beautiful

By Taylor Gray, Ph.D. on April, 5 2021

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Taylor Gray, Ph.D.

The world is a better place when companies are good corporate citizens. I remain focused on developing meaningful and actionable insights from empirical data in pursuit of a better world.

There was an interesting thread on Twitter over the weekend which started with someone moving into a new home and looking for advice on furniture. The replies were coming in fast and could generally be categorized along three criteria of selection: Design, Acquaintance, Sustainability--As in, ‘you should choose this chair, it is a design masterpiece’;  ‘You should check-out this company, Tom works there and they are great’; or ‘You should only buy from this other brand as they use recycled materials’.

I don’t know much about design for anybody’s taste other than my own, and I don’t know Tom, but I do know about corporate sustainability. I was keen to follow up on some of these recommendations to see exactly what it was about these brands that had people recommending them to strangers online.


Taking a Dive

Looking over nine recommended companies led me to two (absolutely not statistically meaningful) observations: all brands which were recommended on account of being ‘sustainable’ were framed as small start-up or boutique-style companies...and the term ‘sustainable’ should be used in scare quotes as some were anything but and others didn’t provide any form of disclosure to support their claims.

This dive into furniture recommendations highlighted an interesting reality. Many of us, and me included, are biased toward wanting to believe and support a small company, a start-up, or a local boutique--we want to cheer for the under-dog. Through this bias we are more willing to believe the claims these companies make or simply fill-in the voids with positive narratives ourselves when they don’t make any claims. 

Many small companies and newer start-ups are leading the charge on rebalancing the Business & Society relationship. Smaller companies often are more nimble and quicker to adapt, and start-ups often don’t have the baggage of legacy that needs to be turned-around. Even so, though, it is important to cast a critical eye to the sustainability claims of small and young companies. Note I said critical and not cynical.

What you really want to know is whether a small company is sustainable because it is actively managing its impact or whether it is simply masquerading as being sustainable on the benefit of scale.


Small is Not always Beautiful

One issue is that many small firms talk about their impact in absolute rather than relative terms. A trendy chair manufacturer may have wonderfully low total annual emissions, but if they only made 400 chairs then it becomes shocking to see that their emissions per product manufactured and distributed may be 3X that of IKEA. What you really want to know is whether a small company is sustainable because it is actively managing its impact or whether it is masquerading as being sustainable on the benefit of scale.

If a company--regardless of size--is meaningful in the management of their impact then they should be disclosing information in meaningful manners. If not, then sustainability is most likely a storyline and not a strategy for them.


Small is Often Big

It is no mystery that many consumers have a positive bias toward small or new companies, but this bias can be blinding. Marketing has preyed on this bias for decades. Just think how often what is effectively  a product channel of some long-established multi-national company is instead presented as an independent up-start brand.

Walk down the cereal aisle at your grocery store and you will swim in a sea of hundreds of options. Each box with its distinct logo, packaging, and story to tell; all these seemingly independent brands competing with each other to make their way into your home pantry. Yet in reality, all these brands in this aisle are likely owned by half-a-dozen companies in total. You are not truly choosing which company you want to support as much as you are choosing which story you want to believe--and that is the magic of marketing.

If you truly want to support small companies then be sure to check brand affiliations. From the original recommendations that started this discussion, I want to point out that Joybird is owned by La-Z-Boy. This isn’t top-secret classified material I am sharing with you, but it is something Joybird does a great job of keeping relatively quiet. This brand affiliation is not a criticism of Joybird, but it is something that should be taken into consideration if your objective is to support what you believe are small up-starts.

Any company that wants to tell a story of sustainability should, and can, tell one that includes facts--actual and meaningful facts.


Small is Not an Excuse

Size mattered...20 years ago. The ability to measure carbon emissions, water management, employee standards, supply-chain dynamics, and so on had long been an arduous--and costly--task, and hence one reserved for the larger and more established companies with the resources required to do so. Smaller firms--and this was broadly accepted--simply did not have the time or money needed to conduct annual impact audits.

But that time has passed. Today, there are countless data services, proxy measures, automated auditing software options, analysts and advisors, cost subsidization schemes, and open-source or community-developed options for any and every company--of all sizes--to be able to meaningfully measure their impacts in ways that are affordable and appropriate to their context. 

Any company that wants to tell a story of sustainability should, and can, tell one that includes facts--actual and meaningful facts. Size is no longer an excuse for a lack of disclosure.

Size alone is not enough to guarantee sustainability.

Critical Analysis

Many older and larger companies may have more to atone for than do smaller and newer companies. As we transition to a more balanced Business & Society relationship, the path is being cleared by the forward-thinking and nimble up-starts and small firms that make up some of the most dynamic parts of our economies...but not exclusively so.

Size alone is not enough to guarantee sustainability. It seems in our nature to want to support the under-dogs and the scrappy up-starts--the quiet disruptors who don’t busy themselves with broadcasting their status as disruptors. There are plenty of great ones doing great things out there for us to support, we just need to cast a critical eye to ensure we are supporting the right ones.


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