- Defining ethical consumerism
- The size of the ethical market
- The ethical food and beverage market
Defining ethical consumerism
Ethical consumerism can be defined as the practice of purchasing products and services produced in a way that minimises social and/or environmental damage, while avoiding products and services deemed to have a negative impact on society or the environment.
The size of the ethical market
According to the Co-operative Bank, the market for ethical products and services includes the following sectors:
- Ethical food and drink
- The green home
- Eco-travel and transport
- Ethical personal products
- Ethical finance
Expenditure on ethical goods and services in the UK increased almost threefold in the ten years between 1999 and 2008. However, it still represents less than 1% of total household expenditure. The ethical market in the UK was worth £36 billion overall in 2008, compared with £13.5 billion in 1999 (Source: The Co-operative Bank).
In 2008, the average spend per household on ethical products and services, excluding charitable donations and ethical finance, reached £735. Spend to address climate change (on green transport, energy efficiency and renewable energy for example) grew from just £23 in 1999 to £251 in 2008. One in every two UK adults claimed to have purchased a product primarily for ethical reasons in 2008, compared with one in every four in 1999.
The ethical food and beverage market
The Co-operative Bank has estimated that spending on ethical food and drink increased more than threefold between 1999 and 2008, from £1.9 billion to more than £6 billion. Fairtrade, organic, free range and dolphin-friendly products were already established by 1999, but with limited availability. During the subsequent ten years, new certification schemes emerged, including the Marine Stewardship Council’s ecolabel for fish and the RSPCA’s Freedom Food standard for animal welfare. Meanwhile, commitments from major retailers and, more recently, major brands have greatly expanded the availability of ethical food and drink.
Spending on ethical food and beverage products in the UK, 1999-2008
| Category |
Spend £m (1999) |
Spend £m (2008) |
| Organic |
390 |
1,986 |
| Fairtrade |
22 |
635 |
| Rainforest Alliance |
- |
369 |
| Farmers' markets |
131 |
220 |
| Vegetarian products |
452 |
768 |
| Free range eggs |
173 |
415 |
| Free range poultry |
37 |
174 |
| Freedom foods |
- |
51 |
| Sustainable fish |
- |
128 |
| Dolphin friendly tuna |
189 |
281 |
| Food and drink boycotts |
532 |
1,069 |
|
Total
|
1,926
|
6,096
|
(Source: The Co-operative Bank)
In addition to greater expenditure on ethical food and drink, there has been a year-on-year increase in spending on personal products, such as humanely produced cosmetics and ‘eco-fashion’. Innovative products, including clothes made from recycled plastic bottles, are becoming more commonplace.
As with any product or service, clear benefits help stimulate demand for ethically produced goods. In environmental terms this is well illustrated by the European Union labelling scheme that is used to classify the energy consumption of white goods. As a result of this scheme, sales of A-rated higher efficiency fridges now account for about 60% of the market. The clear benefit in this case is that more efficient fridges deliver savings in running costs to consumers.
Related internet links:
Ethical Consumer
The Co-operative Bank
Office for National Statistics (ONS)