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Can Amazon Bring More Climate Action To Retail And Payments?

Can Amazon Bring Climate Action To Payments?

So goes Amazon, so goes most of the rest of the retail world, with the eCommerce operator’s influence also extending to payments. That’s been the general situation for a decade or more. But will that hold true when it comes to climate change?

We might soon find out.

That’s because Amazon CEO Jeff Bezos on Thursday (Sept. 19) unveiled the company’s plan to tackle climate change – a plan designed to meet goals set by the Paris climate agreement, but a decade ahead of schedule. According to Amazon, by 2040 the company wants to have net-zero carbon emissions, a mark that Amazon is also calling on other companies to work toward.

Amazon aims to operate 100 percent on renewable energy sources by 2030, and is ordering 100,000 “fully-electric delivery vehicles” as part of this general effort. Amazon also said it is investing $100 million “in reforestation projects around the world to begin removing carbon from the atmosphere now.”

Amazon plans to work with companies in its supply chain to achieve progress on climate change mitigation efforts as well.

Bezos’ Message

The message from Bezos on Thursday was about Amazon taking a leading role in corporate efforts to fight climate change. “We’re done being in the middle of the herd on this issue –we’ve decided to use our size and scale to make a difference,” he said. “If a company with as much physical infrastructure as Amazon – which delivers more than 10 billion items a year – can meet the Paris Agreement 10 years early, then any company can.”

Pressure from Amazon employees for more action on climate change reportedly is helping to fuel this new effort, just days ahead of the planned Global Climate Strike, which has attracted support from the likes of Google and Microsoft.

But that’s probably not it.

After all, numerous studies point to the increasing importance of sustainability among shoppers – especially younger ones – when it comes to making retail decisions. While this new Amazon announcement mentions nothing about often excessive product packaging that is part of retail deliveries (a big sore spot for many consumers, as Kantar says 48 percent of shoppers want consumer goods companies to do more to cut plastic waste), the effort does speak to changing consumer preferences. As well, such a move could potentially win new business for Amazon, or serve to deepen customer loyalty.

Consumer Expectations

By way of example, consider this: A recent study found that 63 percent of U.S. consumers want “businesses to take the lead on driving social and environmental change in the absence of government regulation.” That data point would seem to reflect Thursday’s message from Bezos.

Such consumer desires are hardly contained to retail, as Mastercard demonstrated earlier this year when it teamed with Doconomy to launch a free mobile banking service called DO that enables users to reduce their CO2 footprints through carbon offsetting. In a press release, the companies said the launch of DO sets a new standard for purpose-driven payment services and is a big step in Mastercard’s commitment to fight climate change. The companies said DO lets users’ values guide their everyday consumption toward more sustainable choices. DO also enables carbon offsetting via UN-certified projects. In addition, the service includes the ability to invest in funds that have a positive impact on people and the planet.

Salesforce Action

The push to do something about climate change also extends to the providers of infrastructure vital to eCommerce and related services. For instance, Salesforce, which sells an extremely popular CRM platform, said this week that it was launching a “platform named Sustainability Cloud, aimed at helping businesses take action on tackling climate change.” The company described its Salesforce Sustainability Cloud as “a carbon accounting product for businesses to drive climate action that will accelerate the world’s efforts toward carbon neutrality.”

The move toward more sustainability and action on climate change also involves fast food – it is more than fair to view Burger King’s popular recent launch of its meat-free Impossible Burger, along with similar QSR offerings, via the lens of climate change, given the impact of cattle-raising on the global environment. Indeed, a recent survey from Kantar found that such concerns could help decrease the amount of fresh meat consumed in Britain by 4 percent over the next two years.

Businesses are not only trying to take action on climate change, but they are also planning to benefit from it. One recent example comes by way of Australia, with a report this week detailing how “outdoor apparel retailer Kathmandu says unexpected extreme weather events caused by climate change have boosted its sales, with the company posting a record profit for the 2019 financial year.” And earlier this year, Apple suggested its safety features could be beneficial for iPhone sales – by up to $2.3 billion – in the event of catastrophic climate change. The tech giant said the device’s various safety features, like “SOS,” which puts iPhone and Apple Watch users in touch with emergency services, could increase “customer loyalty and demand” when users have to deal with extreme weather conditions.

Most consumers in the world are just starting to wrap their heads around what climate change means and what impacts it could bring in the coming years and decades. Corporations are not too far ahead of that, of course. But if efforts such as Amazon’s show value and success, you can bet more retailers will follow the company’s example, hoping to gain an edge as consumer preferences shift with the changing climate.

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Featured PYMNTS Study: 

With eyes on lowering costs to improving cash flow, 85 percent of U.S. firms plan to make real-time payments integral to their operations within three years. However, some firms still feel technical barriers stand in the way. In the January 2020 Making Real-Time Payments A Reality Study, PYMNTS surveyed more than 500 financial executives to examine what it will take to channel RTP interest into real-world adoption. Here’s what we learned.

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