Ethical consumerism is buying things that are made ethically. Generally, this means without harm to or exploitation of humans, animals or the natural environment.
The role of the consumer here is to avoid products that cause the exploitation of women and children in sweatshop factories overseas, and also the depletion of the natural resources, as consuming these products means encouraging these actions.
The Genetically Modified food Campaign showed everyone how powerful are the consumers, who succeeded by the removal of the GM from the market and forced many food companies to label their products as being GM-free.
Four types of ethical buying:
Ethical consumption means that consumers support companies perceived as “ethical ones”, and withdraw their support to those perceived as unethical.
Positive buying:
This means favouring particular ethical products, such as energy saving light bulbs, or products produced locally.
Negative Purchasing:
This means avoiding products that you disapprove of, such as disposable batteries, instead of rechargeable ones.
Company-Based Purchasing:
This means targeting a business as a whole and avoiding all the products made by one company. For example, the Nestle boycott has targeted all its brands and subsidiaries in a bid to get the company to change the way it markets its baby milk formula across the world.
Fully screened Approach:
This means looking both at companies and at products and evaluating which product is the most ethical overall.
In United Kingdom, the Ethical Consumer Magazine, launched since 1989, tries to recommend to the readers the ethical products by using the fully screened approach.
Ethical boycotts, recycling, second hand purchasing, support of sustainable fishing or farming are the ways of preserving our planet’s resources, and the actions of the ethical consumers.
Ethical boycott:
Ethical consumers choose to boycott products which contribute to human rights violations, environmental destruction and animal abuse. For example: cosmetics tested on animals, or boycott clothing retailers with poor labour conditions. One of thecommon boycotts is the one against South Africa’s oranges because of the Apartheid.
According to the Ethical Consumerism Report 2007, published by the Cooperative Bank in United Kingdom, 52% of the consumers claim to have boycotted at least one product once in 2005, because of their principles. Furthermore, two thirds of consumers claim not to return to a brand once they have boycotted it, resulting £338 million loss for the clothing companies.
Recycling:
The local authorities have made recycling easy for everyone by placing different coloured bin to divide waste into separate compartments. In United Kingdom, 1.5% of the Gross Domestic Product is split on treating waste. Last year, 96% of this population reported that they have recycled their waste.
Re-use or second hand purchasing:
In our everyday life, we often throw away things which can still be used, like no longer fashionable clothes or television.
Indeed, our volume of waste is increasing. In United Kingdom, there is around 27millions tonnes of household waste produced in one year, representing 1.2 tonnes of waste per household. People should buy products with less plastic packaging,or should minimise waste by cooking less food, rather than to throw away leftovers.
Sustainable fishing and farming:
Seafood isexhaustible. Today, all the fish stocks around the world are under threat.
According to the United Nations, nearly 70% of the marine fisheries are fully or overexploited. For example, the North Sea cod.
The European Commission had introduced a regulation ensuring traceability. Since then, fish are clearly labelled with all basic information, like the country of origin.
According to the Ethical Consumerism Report 2003, published by the Cooperative Bank, 86% of consumers are opposed to the use of caged egg production. They prefer free range eggs. So, in 2006, the sale of these eggs increased to £259 million, and contributed to 40% of total retail egg sales.
Fair Trade products:
The Fair trade sector is growing every year, with the support of the increasing consumers. In United Kingdom, the sales of products carrying the Fairtrade Mark have been growing by 49% to reach £285 million in 2006. The sales of Fairtrade tea and coffee have reached £118 million, a rise of 43% since 2005.
And in 2006, the sales Fairtrade wines, has increased by 68 % in retail value
The role of Global Communications and public commitment
Today, thanks to Medias,people are aware of current events and though become more concern about climate change, poverty, fair-trade.
Advertising, and also campaigns for ethical consumption is one effective way to touch people.
People are now shifting to ethical products as, either they are the only products that these consumers can find at their supermarkets, or really because they are looking for ethical products.
In Paris, normally during the hot days of summer, the local authorities advise the Parisians not to use their car and rather use the public transport, which is more ecological. Moreover, since last year, in Paris, everyone can rent bicycle everywhere in the city, which cost around 1€ for every 30 minutes or have a package for one year, at only 30€.
Sometimes, people do not have to think ecologically or ethically, all is done such a way by local authorities, that they will automatically choose the ethical solution.
In fact, in Paris, the population prefer using the public transport, as when using their car, they will have to face traffic jam, expensive parking, which is also difficult to find, and also because of the cost of petrol.
The awareness of consumers has provoked a change for big companies.
The role of big companies
In United Kingdom, Sainsbury, Waitrose and Marks & Spenser are considered as the greenest supermarket, according to a recent report of the National Consumer Council. In France, it is the supermarket Monoprix, which is following this trend.
People are now asking for more information about the product’s origin or company’s identity before buying. In fact, consumers are willing to pay more for guarantees of fair labour practices and sustainable sourcing.
Big companies like Nestle, Cadbury, Danone, are now offering fair trade products.
Moreover, Nestle is a “founding member of the Sustainable Agriculture Initiative Platform”, a 19-member strong food industry body, along with Danone and others, that support the development of agricultural practices that preserve current resources and enhance their efficiency.
The coffee shop Starbucks has made a deal with the Ethiopian farmers by paying them well, and makes long term collaboration with them.
“Innocent Drinks is a good example of ethical business. “It produces 100% natural drinks, made from 100% pure fruit and fresh juices, with no concentrates, colourings, preservatives, water or sugar. Their range includes ethical smoothies (fruit in a bottle), thickies (live probiotic yoghurt, real fruit and honey), juices, super smoothies and juicy water. Since 2003 all their drinks have been supplied in bottles made with 25% recycled plastic, which is the maximum that current technology will allow. To offset its environmental impact, Innocent funds social programmes including planting trees and donating money to an NGO who buy mango trees and cows for farmers in poor rural areas of southern India”.
Energy suppliers are also proposing to their customers, renewable energy, and are advising them to use energy efficient appliances, light bulbs.
Big companies are now conscious that to preserve their consumers, they will have to make efforts, particularly, by making ethical business.
Conclusion: Ethical consumption, a trend or a step to responsibility?
In my opinion, it is a trend which companies, are compelled to follow, as consumers are now aware of all their activities, thanks to Medias,and can either choose to support them, by buying their products or rather boycott them if they are considered as unethical.
This “ethical” concept is also a new opportunity to win market share, it enables companies gaining image advantage with consumers
Still, nowadays the sales of ethical products remain low compared with the overall market, but it is expected that they will increase in the coming years. Prices are still too high. For many people, they will first look for the price before buying a product, not because they do not feel ethical, but because sometimes they do not have the choice.
But with competition, after the arrival of other companies on this market, prices will be lowered and thus these products will become more accessible for more people.
By consuming consciously and ethically we can create change. Being aware of current issues in labour exploitation, environmental conservation, and human rights is the best way to spend ethically.
Launched in 2001 by Alpheus Bingham and Jill Panetta, Innocentive is based in Waltham, Massachussets.
It works as a platform for seekers and solvers.
Seekers can be companies (for example: Procter & Gamble, Eli Lily), engineers, scientists, business people, inventors, government agencies and other thinkers. They post issues in any discipline, such as Chemistry, Engineering, Maths, Physical sciences, business, etc, on the Innocentive website.
Solvers can be anyone, who wants to solve the problem by finding the right solution. The challenge is posted and has a deadline of 60days to 5 months, depending on the complexity of the problem.
Registered solvers represent more than 60 different scientific disciplines and are about 135 000. About 35% are located in Asia-Pacific region, 26% in North America, 15% in Western Europe, 9% in Eastern Europe and Russia.
Solvers send their solution and the most appropriate or the right solution is awarded, and the reward is from 5000$ up to 1000 000$. Sometimes, it may happen that this solution is not found.
Both Seekers’ and Solvers’ identity are kept confidential and Innocentive guarantees also the protection of Intellectual Property.
In fact, Innocentive uses internet to connect seekers who formulate complex issues, and solvers to “evaluate promising solution”.
Since 2006, the company is in partnership with the Rockefeller Foundation, in order to find solution due to problems faced in developing countries, for the non-profit sector.
The revenues of Innocentive are mainly the annual access fee of the Companies (seekers) of 80 000$ to post anonymously their issues. When the best solution is rewarded to the solver, Innocentive has a commission of 20% or more.
The benefit for Seeker companies is that they do not have to invest a lot in Research & Development. They can find solutions, for example to innovate, by the “grand talent” from all around the world. It is an outsourcing of their R&D issues. It also reduces risk of research failure and enable them to save time.
Example of problems posted on the website to be solved:
INNOCENTIVE 5644660 Theoretical-IP Transfer 386 project rooms open
Solar-powered wireless routers
POSTED: NOV 28, 2007 DEADLINE: JAN 28, 2008 $20,000 USD A design for a solar-powered wireless router composed of low-cost, readily available hardware and software components is needed. The router is to become part of a reliable Internet communication network connecting metropolises and remote towns in developing countries. This challenge sponsored by the Rockefeller Foundation requires only a written proposal.
INNOCENTIVE 5658154 Ideation 289 project rooms open
Marketing video aimed at recruiting new Solvers
POSTED: NOV 29, 2007 DEADLINE: FEB 29, 2008 $5,000 USD This challenge is looking for creation of marketing videos aimed at energizing the recruitment of new InnoCentive Solvers. There will be two winning videos: one chosen by the InnoCentive staff and the other by the whole InnoCentive Solver community. Both winning videos will be used in future marketing campaigns.
Advantages of this business model:
Connecting the most creative minds.
The guarantee of confidentiality of both seekers and solvers.
Seekers spent less in time and money to have the best solution for their problem.
Disadvantages:
It is difficult to evaluate the cost for the solvers for a specific issue.
Some companies may be “reticent” to post their R&D issues on internet.
Good ideas sent by solvers not chosen, would be lost
The business model could exist offline, but with internet, can connect talented people from all around the world, with those in need of this talent.
It is a sustainable business model as issues will always form part of the everyday life of companies and organisations. It helps them to improve their business technologies and to find innovations, and thus be more competitive.
It is a great idea, to have stretched the business to non-profit organisations, which can help developing countries to progress faster.
Somehow, Innocentive could make more online and offline advertising, as I personally did not know this great model. Furthermore, Innocentive should reward good ideas received from solvers, which can be used to solve other problems, not yet defined.
Innocentive can be very useful to start-ups, in innovative sectors.
I'm from Mauritius, an island in the Indian Ocean. In 1999, I came to Paris for studies. I'm soon to be graduate in Masters of International Trade. In the meantime, I have enrolled in a MBA in Hospitality Management at the CMH- European Center of International Hotel Management.
