Seeking growth has become a common proposition faced by various industries.
On the home appliance track, Haier Smart Home has performed well. In the first quarter of 2024, Haier Smart Home continued the trend of steady growth in the annual report, continued to achieve high growth from a high base, and its profit growth rate was as high as 20.2%, exceeding expectations. Since the beginning of this year, Haier Smart Home has also been favored by the capital market, and its stock price has risen by more than 56% year-to-date (as of May 13), and has continuously hit new highs.
In addition to performance, ESG has also become another yardstick for the capital market to measure corporate value in recent years. Haier Smart Home's outstanding performance in ESG has also become another reason why it is favored by the capital market.
On May 13, Fortune (Chinese version) released the 2024 China ESG Influence List, and Haier Smart Home was once again on the list, ranking first in the industry for three consecutive years. It is reported that this is also the third edition of the Fortune China ESG Influence List.
So how does Haier Smart Home deploy ESG? What impact has it had on its growth and long-term development?
Performance and ESG "complement each other"
Many companies believe that ESG is just a public welfare action that will not have much impact on performance growth, but in fact the two are complementary to each other.
For example, the 6-Green strategy laid out by Haier Smart Home is not only in line with the general trend of the national "dual carbon" goal, but also promotes performance growth by improving user experience. In turn, performance growth can also allow Haier Smart Home to have more sufficient resources to better deploy ESG.
1. Green carbon plan
The domestic home appliance market is opening a new round of "trade-in" to create new market increments for home appliance companies such as Haier Smart Home. The core of this round of "trade-in" is not only the price, but more importantly, the user experience.
If home appliance companies want to truly grow, they must solve user pain points, improve user experience, and meet their needs in terms of greening and intelligence.
It can be found that Haier Smart Home has done a good job in these aspects.
On April 17 this year, Haier Smart Home launched the "Green Carbon Plan" and launched a series of new smart technology products and scenarios, focusing on the four new propositions of health, green, wisdom and Meiju, with the aim of allowing users to renew a better life as quickly and efficiently as possible.
Through the "6-Green" strategy of green procurement, green design, green manufacturing, green management, green recycling, and green disposal practiced by ESG Haier Smart Home, the Boguan refrigerator brought by the "Green Carbon Plan" is more than 15% more energy-efficient than traditional refrigerators, and the essence washing machine can save 38% of water consumption and 29% of electricity consumption, and the air washing air conditioner can save 38% of water consumption and 29% of electricity consumption......
In other words, Haier Smart Home not only allows users to enjoy better product functions, but also allows them to save water and electricity bills. When the experience of the product is good enough, it will naturally be favored by more users, which is also one of the reasons why Haier Smart Home's performance can exceed expectations.
With the implementation of the "Green Carbon Plan" across the country, Haier Smart Home is also achieving simultaneous performance growth. According to the data, from May 1st to May 5th, Haier's smart home market share once again ranked first in the industry, with the overall retail sales of Haier increasing by 8.8% year-on-year, and the overall share of online and offline products growing positively year-on-year. At the same time, in the high-end market, Casarte's overall share accounted for 23.9%, ranking first in the industry.
2. Overseas market
Under the increasingly fierce competition in the domestic home appliance market, the exploration of overseas markets has become more and more important.
However, if enterprises want to go overseas smoothly, they must also increase their layout on the "E" of ESG. Because on the one hand, the demand for green home appliances from many overseas consumers has increased greatly; On the other hand, some governments are increasingly emphasizing the importance of green home appliances. For example, the European Union's ErP directive puts forward strict energy efficiency requirements for household appliances placed on the European market, and the RoHS and WEEE directives put forward strict environmental protection requirements. If some home appliance companies do not meet the requirements of the directive, it will be difficult to enter the European market.
It can be seen that the energy-saving and environmental protection experience of Haier Smart Home products in overseas is also excellent, which has been recognized by users and successfully achieved good results in overseas markets.
For example, some European consumers attach great importance to fresh air and energy saving when using washing machines, and Haier Smart Home's X11 series washing machines have improved the user experience in these aspects and gained a very high popularity value in Europe. Specifically, the X11 series washing machine is equipped with an original new air function, which can completely replace the air in the drum in only two minutes, and can continue to change the air for up to 12 hours, even if the user forgets to dry the clothes, it will not produce musty smell; In terms of energy consumption, the X11 series washing machine is a new benchmark for energy conservation in Europe, saving 50% more energy than the European A-level energy efficiency standard.
In the market, the X11 series washing machine occupied 10% of the high-end market share in Poland as soon as it was launched, driving the price index to rise to more than 130.
In the U.S., GE Appliances launched a large front-loading washing machine that shortens the industry's standard 6-hour washing and drying time to 2 hours, while also saving energy by 50%. In the past, American consumers needed two products to complete the wash, but now they only need one. This also led to the overall share of washing machines in the local large drum washing machine from 4% to 19%.
With its excellent user experience in greening and other aspects, Haier Smart Home will have more advantages in expanding in the global market in the future and will be able to tap greater performance increments.
ESG: Enabling long-termism
The "E" in ESG can have a direct impact on performance, while the "S" and "G" can enhance the brand power of the enterprise, optimize the governance structure and management quality of the enterprise, and help the enterprise achieve long-term development.
1. Social responsibility
Corporate social responsibility is not only a one-sided effort, but also an intangible asset that can gain a good reputation and enhance brand power among users, customers and the wider society.
It can be seen that, unlike many other companies that only focus on China, Haier Smart Home strives to create social value on a global scale. In China, Haier Smart Home has assisted the construction of a total of 386 hope schools, making it the enterprise with the largest number of hope primary schools aided by the Central Committee of the Communist Youth League. Overseas, Haier Smart Home also donated materials and cash to local public welfare organizations and charity activities in Poland, Thailand, Italy, Indonesia, the Philippines, Turkey and other countries.
2. Corporate governance
In addition to social responsibility, in order for an enterprise to achieve long-term development, the premise is to have a stable and high-quality organization, otherwise no matter how good the short-term performance is, the long-term enterprise will also be sluggish.
It can be seen that Haier Smart Home has always paid attention to honest management and standardized governance, laying a solid foundation for the stable and healthy development of the enterprise. For example, in 2023, 22.2% of the board of directors of Haier Smart Home will be women, and 44.4% will be independent directors on the board of directors, 258 anti-corruption and anti-fraud trainings will be held internally, 12 issues of compliance e-journals will be released, and the average anti-corruption training time will exceed 2 hours per person, and integrity reminders will be issued to all suppliers.
Overall, with its ESG practice, Haier Smart Home's achievements have been widely recognized by domestic and foreign institutions. In China, Haier Smart Home is the only company selected as one of the "2023 ESG Best Practice Cases of Listed Companies" by the China Association of Public Companies. Overseas, MSCI's ESG rating has been upgraded to A, the highest in the industry.
In the future, there will still be a lot of room for development in the global home appliance market, and ESG will also become an important development trend in the home appliance market. Haier Smart Home is undoubtedly at the forefront of ESG layout, and while improving user experience and creating social value, it is also creating new growth points for itself.