In this age of heightened awareness about environmental issues, you can kill or seriously injure your brand image with just one bad decision. Germany’s Volkswagen Group has gone out of their way to prove this, installing an illegal defeat device with intent to cheat on emissions tests.
But you don’t need criminal intent to do damage to your brand image—along with the brand equity that it’s meant to create. Consider this headline:
California EPA says settled with Apple on hazardous waste claims
It appeared last December on the international Reuters website for redistribution among hundreds of newspapers worldwide, in 48-point typeface, resplendent above a huge image of the bright red Apple logo. Of what was Apple guilty?
After inspecting the company’s Sunnyvale electronic scrap-shredding facility, the California Department of Toxic Substances Control cited Apple for:
- Transportation of hazardous waste without a proper manifest
- Failing to report and track exports of hazardous waste
- Failing to label or otherwise mark used oil containers as hazardous waste
- Failing to provide notice of closure for the facility in Cupertino
- Failing to submit a written closure plan and cost estimate for closing the facility in Cupertino and for eventual closure of its shredding facility in Sunnyvale
- Failing to demonstrate financial assurance to fund the eventual closure of the two facilities
Recall that brand equity is arguably Apple’s largest asset. The premium price commanded by its products and services relative to other brands is part & parcel a byproduct of its brand image—particularly among those for whom environmental stewardship is a key issue. This brings to mind another recent headline:
Whole Foods Reaches $3.5 Million Hazardous Waste Settlement
It appeared in hundreds of news outlets last September. Whole Foods strives to make environmental sustainability a major constituent of its brand image. Such values logically correlate with their target customers, who prefer additive-free “whole food” that is minimally processed or refined.
The company agreed to the settlement with the EPA regarding how they disposed of customer returns and out-of-date products that were no longer shelf-worthy. These included such innocuous goods as nail polish remover, hand sanitizer, liquor, vitamins, and other products that the EPA classifies as hazardous waste once they can no longer be used for their intended purpose.
There was no criminal intent. Nonetheless, there was significant damage to the Whole Foods brand image—especially since the settlement tossed the ecologically self-conscious company into the same shopping cart with Wal-Mart, which perpetrated a similar brand fiasco upon itself some years prior. Recall:
Wal-Mart pleads guilty and settles charges that it dumped hazardous waste in sewage systems, among other violations
In a well-publicized case in 2013, Wal-Mart Stores settled a decade-long investigation into its hazardous waste practices, agreeing to pay $81 million: a case where poor environmental stewardship further eroded a brand image that was (and remains) under duress among the “eco-conscious” portion of the buying public.
The offense was similar to that of Whole Foods: environmentally benign products became hazardous waste when they could not be sold. The EPA cited Wal-Mart for neither having a hazardous material disposal program nor training its employees to abide by one—at the store level.
So what’s the upshot?
Hazardous waste removal is one of the most volatile responsibilities businesses nowadays face. The innocent and/or inadvertent mismanagement of hazardous waste removal can lay waste to your brand image. And what the EPA considers hazardous waste is not always obvious without expert advice.
As well, these three cases illustrate how hazardous waste management isn’t only a problem for industry and manufacturing. After all, Apple, Whole Foods, and Wal-Mart are quintessential business-to-consumer enterprises.Hazardous materials disposal was likely a non-issue for their managers until the authorities came knocking on their respective doors.
Brand identity refers to how your company wants to be perceived—and the effort you put forth to achieve that perception in the public consciousness. It’s not to be confused with brand image: the actual way the public perceives your company—independent of those efforts.
Your brand image contributes mightily to your brand equity: the commercial value attributable to how the public views your company—apart from the product or service you provide. And in this day and age, protecting your brand equity demands protecting the environment—by law.