Does Going Green Pay Off for Record Labels?
Written by djfrosty on July 25, 2024
LONDON — Record companies that actively embrace sustainability are more efficient, more innovative and more likely to appeal to artists, fans and employees, according to research carried out by European independent labels trade body IMPALA.
The Brussels-based organization’s inaugural report into the economic benefits of sustainability, published Thursday (July 25), says that labels who have implemented green measures, such as reducing travel and shifting distribution from air to sea freight, make cost savings over time and reduce waste.
Other rewards identified by IMPALA members who took part in the survey include tax breaks for sustainable initiatives and the ability to gain a competitive advantage over less-eco-friendly businesses when it comes to attracting and retaining artists, especially from younger musicians who place sustainability high among their list of priorities.
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Labels and music companies who have taken environmentally friendly action additionally benefit from an improved brand image among music fans and a more creative and forward-thinking business culture, said the trade group.
The report’s findings are based on qualitative interviews IMPALA conducted earlier this year with a number of European indie labels signed up to the organization’s sustainability task force, including Beggars Group, Ninja Tune, PIAS, Warp and Domino.
Independent research projects carried out by U.K. labels trade body BPI, professional services company PWC and Harvard Business Review into sustainability also fed into the report’s findings.
Helen Smith, executive chair of IMPALA, said its research indicated that the adoption of sustainability practices by record companies benefits not just the planet but also delivers “concrete advantages in other areas such as attracting artists, reducing costs, hiring and retaining employees,” as well as “being seen as a [market] leader.”
“The question of futureproofing is also important as companies see sustainability as an opportunity before it becomes a burden, and this pays off almost immediately,” said Smith in a statement accompanying the report.
IMPALA, which represents 6,000 independently owned European labels and music companies in 33 countries, launched its sustainability program in 2021. It aims to halve the sector’s greenhouse gas emissions by 2030 and achieve net zero emissions before 2050.
To help reach those goals the organization devised a carbon footprint calculator for member labels to measure and reduce their emissions. So far, nearly 150 labels have signed up to the initiative, which has now been rolled out to the U.S. in partnership with the American Association of Independent Music (A2IM).
IMPALA’s first carbon footprint calculator data report, which was published last year, found that the biggest source of carbon emissions for the indie sector is manufacturing (predominantly vinyl production), followed by the distribution of physical products.
To help tackle the climate crisis record labels around the world are taking positive steps to become more sustainable by reducing waste, water, electricity and fuel consumption.
Other green practices that have been recently introduced by IMPALA members include replacing plastic jewel CD cases with cardboard ones and switching vinyl production from PVC compound to the more environmentally friendly polyethylene terephthalate (PET) material, which equates to a 70-80% reduction in energy consumption, says the organization. Opting for 140g vinyl instead of 180g also lowers production costs and labels’ environmental impact, it adds.
Members of IMPALA’s sustainability task force noted that green initiatives had a significant impact on the quantity and quality of job applications they received, improving employee retention and workplace culture.
“We’re proud to have sustainability as one of our core company values and have seen this translated with attracting and retaining top talent, said Horst Weidenmueller, chair of IMPALA’s sustainability task force and CEO of K7 Music.
Last month, the Germany-based label became one of the first indies to receive B Corp certification in recognition of its social and environmental practices. “It’s great to see consumers and suppliers moving in the same direction,” said Weidenmueller in a statement.
According to a 2022 survey by U.K. charity Music Declares Emergency and the University of Glasgow, music fans are more likely to care about climate change and place a higher priority on tackling the crisis than non-music fans. A different survey by U.K. entertainment product manufacturer Key Production found that 71% of 18–24-year-old respondents were willing to spend more on physical music products with a reduced environmental impact. Across all age groups, 50% of respondents said they would pay a premium price for eco-friendly merchandise, CDs or records.
In line with consumers’ growing concerns around environmental issues, sustainability has become a key focus and area of investment for the wider music industry.
Last year, Universal Music Group, Sony Music Entertainment and Warner Music Group joined forces to establish the Music Industry Climate Collective (MICC) – a new alliance to address and lessen the sector’s environmental impact, which is being assisted and advised by A2IM.
In 2021, all three major record companies, plus independent labels BMG, Beggars, Partisan, Warp, Ninja Tune and the Secretly Group, signed up to the Music Climate Pact, a wide-ranging commitment to “decarbonize” the global record business.