What’s next for sustainability and ethical consumerism?

Michelle Henderson for Unsplash

Ethical consumerism has expanded remarkably over the past 20 years. And will continue to do so as we head into (hopefully) post- Covid 19 recovery and beyond. 

The Coop’s annual Ethical Consumer review has tracked ethically-based spending in the UK for the past 21 years. It’s report last year (based on 2018 figures) showed that since 1999, the size of the ethical consumer market in the UK alone has grown from £11.9billion in 1999 to over £41.1billion in 2018. That’s a fourfold increase when over the same period, UK household expenditure increased just 2%. 

To break this down a bit, spending on responsibly sourced food and drink has gone from just over £1billion in 1999 to almost £12billion in 2018. Spending on the sustainable home (such as green cleaning products or energy efficient appliances) went from £1.4billion to £10.3billion. Other categories include personal care/beauty, leisure and travel, and they all show similarly spectacular growth.  

The trend has sped up over the past couple of years. Research by Morgan Stanley shows that In 2017, 86% of millennial investors were interested in investing in sustainable causes - that figure is now closer to 95% showing. Consumers are now broadening their thinking away from simply spending their money on social impact causes, to more strategic uses of their money and influence.

Covid-19 has accelerated this further in terms of both spending - with added focus on shopping locally and plastic consumption - and in terms of consumer understanding. As Jo Whitfield Chief Executive of Coop says, we are in an ‘unprecedented time of awareness on the challenges people and the planet face’.

Source: COOP Twenty Years of Ethical Consumerism

If we want to effectively tackle climate change, overconsumption, animal rights, worker conditions etc etc, it won’t be about everlasting market growth but systematic changes to our eating habits, housing, travel, leisure and clothing. 

Interestingly, some of the options we consider today to be the sustainable options may well be considered outdated in just a few years time. Take electric cars for example - a clear improvement on petrol and diesel cars, but what are the long term implications of large scale battery disposal? Sustainability is a fast moving and innovative field that will have to continuously adapt to our changing circumstances.

Whilst moving our economies to a more sustainable foundation raises plenty of questions, the overall message is clear - ethical consumption is a growth market and is the future of our economy. Businesses that are founded on social and environmental principles and already trading on that basis are ahead of the curve and perfectly placed to a. increase their impact as their profits increase and b. continue to educate both their consumers as to sustainable alternatives and c. serve as examples of best practice to companies working to integrate more principals-based management and products into their business model. We’re in the right place at the right time - our job is to continue what we’re already doing,

There are plenty of indications pointing us towards what might be next in terms of the ethical economy. Here are just a few -

Transparency and impact measurement - just last month (September 2020), Friends of the Earth, Greenpeace, A Plastic Planet, and Surfers Against Sewage and Iceland issued a joint statement calling for retail and wider business sector to commit to enhanced transparency in reporting on plastic consumption and for tougher government regulation on the reporting. It will no longer be enough to say you are doing something - ESG auditing will become as necessary as basic financial reporting. 

Producer responsibility - similar but not identical to the above. There will be far more expectation on producers to design disposal solutions for their products rather than simply the products themselves. Whether this means redesigning the products themselves or having to construct disposal systems will depend on the industry, but sending mass produced items out into the world and leaving individuals and governments to work out how to deal with the remains will no longer be acceptable.

Ethical banking - this is a huge potential growth area as it is so easily overlooked but something we should all be engaged with. How is our money being used by our banks? Are we banking with a company that is using our savings and investments to prop up the very industries and systems we work so hard on a personal level to counter? Ethically based companies need to be particularly aware of this as it is not just personal finance but their company accounts, investments and any long term policies (I’m thinking mostly pensions here) that could be going into funds that are diametrically opposed to your company ethos. For your own peace of mind, check what your bank’s investment policies are but also, coming back to the transparency I mention in point 1 - an audit or impact measurement will immediately highlight your banking set up and unwitting use of a bank known to invest in damaging practices could have a serious reputational risk for your own company.

The importance of local - buying local produce from a ‘real’ person, supporting independent retailers and knowing where something comes from have long been on most peoples’ radars. But Covid-19 has underlined this by showing how fragile long, overly complicated supply chains are. Whilst globalisation is here to stay, there is a growing public awareness that local suppliers and short supply chains are more than capable of meeting their needs and, in many cases, vastly preferable to the complicated and opaque supply chains that have become the norm. As Greg Deacon from the National Federation of Independent Retailers says “people have reawakened to the idea that the local shop is more than a local shop, it is a cornerstone of the community”.

There are few silver linings to the Covid19 pandemic but I hope that an acceleration in more considered business practice and consumerism might be one of them. I’d like to think that in another 20 years, the COOP annual Ethical Consumer might not even be necessary - because it’s become the norm rather than an interesting fringe activity. Fingers crossed…

I’ve barely scratched the surface in terms of new technologies, trends and developments so would LOVE to hear your thoughts on what’s next...as ever, please get in touch.