Research for Social Good

Sustainability: giving purpose, supporting communities, and fuelling innovation in Latin America

When the pandemic threatens years of advances towards the UN SDGs (United Nations Sustainable Development Goals), purpose-driven businesses respond to the needs of communities today and fuel innovation that will define the region.

The Coronavirus pandemic abruptly changed how we live our lives impacting every nation in some way around the world. The news cycle changed to spotlight this human tragedy’s devastating loss – exacerbation of poverty, rising unemployment, lack of food security and social and racial inequalities. In the eyes of consumers, businesses, and governments, sustainability shifted from tackling environmental perils to centring on the needs of humanity – giving greater weight to the socio-cultural pillar, and accelerating purpose-driven businesses.

Since the onset of the pandemic, businesses globally have responded by both delaying and accelerating sustainability initiatives. 32.3% of respondents surveyed globally delayed development/launch of sustainable products, meanwhile 15.9% accelerated the development/launch according to Euromonitor International Voice of Industry: Sustainability (June 2020). While 3.4% delayed supply chain resilience programs, 9.2% accelerated theirs. Over one third accelerated employee support programs compared to 7.8% that signalled a delay. Recycling and waste remain in the topmost invested sustainability programs globally while more businesses now invest in developing sustainable products (53.2% in 2019, and 69.0% in 2020) and sustainable sourcing (48.0% in 2019 and 60.1% in 2020).

In Latin America, the stakes for recovery are high with a forecasted economic contraction of 9.4% in 2020, according to the IMF (June 2020). Years of the region’s advances towards the United Nations Sustainable Development Goals (SDGs) including poverty reduction, closing the gender gap, and advancing the region’s position in the world could be reversed by a less-than-desired recovery. In Latin America, businesses and governments can embrace sustainability supporting the immediate needs and longer-term goals of communities in these ways:

Authentically embrace sustainability as a brand and capture global consumers

Globally, brands are responding authentically to today’s environmental and social challenges by finding innovative ways to solve for them, strengthening their brand reputation and building loyalty among consumers and other stakeholders. And in Latin America?

Walmex (Walmart Mexico) cared about more than the bottom line when launching “Los Esenciales” in April 2020. 125 essential items were offered at the lowest price to improve the affordability of essential goods for affected populations.

Hyundai in Brazil responded by sharing available resources creatively, offering free transportation to healthcare professionals and elderly, supporting the repair of mechanical ventilators at hospitals, and leveraging 3D printers to produce face masks.

Despite incredible hardships for the Consumer Foodservice industry, Colombian restaurant company, Takami, chose to be a good partner to suppliers up the value chain and maintained its commitment to buying local. The company locally sources its ingredients and has a carbon-offsetting reforestation project; it launched DespensaTakami during the pandemic to sustain the livelihoods of its employees and vendors. Responses like this one matter as small and medium-sized (SME) businesses represent the majority of Latin American businesses, and 30% and 40% of SME businesses in the region had to close between January and May of 2020 as a result of the Coronavirus according to SELA.

Invest now in developing sustainable products or services that will drive future economic performance

Purpose-driven product and service innovation can expand the current offering allowing businesses to generate new revenue streams, mitigate risk and differentiate itself among the competition.

Since 2007, Uruguay has been investing in digital education, allowing for a quick and prepared response to education shifting from being in-person to online once the pandemic hit.

Small businesses can also experience short-term return on investment. For example, La Trocha, a woman-owned neighbourhood store, offering organic goods in Colombia, embraced the challenges brought forth by the pandemic and quickly adapted the business model to the changing social needs by reducing operating hours and offering an app-based delivery alternative; ultimately the store earned triple the revenue (BBC).

Collaboration over the competition to achieve maximum impact

While collaboration requires a shift from a competitive mindset, partnering creates new opportunities with shared responsibility and shared benefit.

In Mexico, the coordinated public-private sector initiative “Todos Juntos Contra el COVID-19” created synergies allowing hospitals to attend to more patients – with and without the Coronavirus – and yield better individual health outcomes while mitigating the public health risk.

Costa Rica’s early coordinated response to reigniting the tourism industry, the largest employer of the region, is another example of embracing collaboration to achieve maximum impact. Costa Rica, one of the top 3 Latin American countries in advancement towards the SDGs, developed a post-crisis plan bolstering alternative revenue streams from domestic tourism while simultaneously reducing dependence on international tourism. According to Euromonitor International Voice of Industry – Sustainability (June 2020), global travel and tourism’s engagement with the SDGs is stronger (50.4%) compared to average across industries (48%). A collaboration between government, destination management, hoteliers and SMEs will be the key to rebuilding and attracting international travellers once again.

Prepare for a continued state of digital evolution

Consumers and businesses continue to adopt new digital technologies, which too can aid in achieving sustainability objectives and amplify the reach of initiatives.

Latin American tech companies are developing apps that respond to environmental and social needs. Chile’s NotCo is a start-up using artificial intelligence for developing non-animal-based proteins, conscious of the carbon emissions and environmental impact of meat consumption. Brazil’s HandTalk developed an app that facilitates improved sign-language communication to foster greater inclusivity.

Furthermore, with over 40% of the world’s biodiversity in Latin America, and strong agricultural industry, innovations to improve supply chain transparency such as that of JM Smucker, Farmer Connect, and IBM that help farm-to-consumer traceability using blockchain technology are relevant. Using the ‘Thank My Farmer’ app, consumers can scan the QR code on the product and trace back to where the raw ingredients were produced. Advancements like these can have an impact on multiple industries, particularly relevant for an agricultural hub like Latin America.

Demand for sustainable products and services from consumers, and legislation and policies by governments to work towards the SDGs will continue to gain traction into normalization. Many Latin American business across sectors (as exemplified above) have achieved and continued to achieve success – value creation, cost reduction and risk mitigation – by embracing the principles of sustainability. With time, greater harmony between the social and environmental sustainability responses can be expected, and brands will emerge that continue to focus on purpose, while also delivering profit.


If you are interested in more content on the Latin Amercian region, please make sure to join ESOMAR Latin America Insights Festival broadcast on the 19 – 21 October 2020. (ed.)

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