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Market for Ethical Products Grows by Nearly $20 Billion Despite Economic Downturn
January 3rd, 2013
Consumers remain willing to pay a premium for ethical goods and services despite lingering economic troubles, according to a new study.
The annual Ethical Consumer Markets Report produced by the UK’s Co-Operative shows that since the onset of the recession five years ago, the total value of ethical markets has gone from £35.5 billion (US$57.7 billion) to £47.2 billion (US$76.7 billion). Furthermore, it’s grown from £13.5 billion ($21.9 billion) in 1999.
The report analyzes sales data for various sectors including food, household goods, eco-travel and ethical finance. Amongst the biggest growing categories during the recession are sustainable fish, up 323 percent from £69 million (US$112 million) to £292 million (US$474.6 million).
Fairtrade has increased 176 per cent from £458 million (US$744 million) to £1.262 billion (US$2.051 billion) and free range eggs sales are up 78 percent from £444 million (US$721.2 million) to £792 million (US$1.287 billion). However, sales of organic produce, although now stabilized at £1.5 billion (US$2.44 billion), have declined from a high of £1.9 billion (US$3.1 billion) in 2008.
In 2011, ethical food and drink markets increased 7.8 percent to reach £6.9 billion (US$11.2 billion). Markets for green home products were up 10.6 percent to £8.4 billion (US$13.7 billion) and ethical personal products were up 4.3 percent to £1.8 billion (US$2.9 billion).
“The report shows that intervention by enlightened businesses, together with regulatory intervention, is driving ethical sales growth,” said Barry Clavin, Sustainability Reporting Manager at The Co-operative. “During the downturn we’ve seen some of the biggest ever Fairtrade conversions, be it in chocolate or sugar, and business is beginning to respond to the challenge to provide consumers with more sustainable products and services such as fish, palm oil and soya.
“At the same time, let’s not lose sight of the fact that ethical sales remain a small proportion of total sales. Ultimately, over and above the efforts of responsible business and ethical consumers, sustainable solutions require a government committed to long-term intervention,” Clavin added.
In 2011, the Co-Operative launched what it said is the "most radical sustainability program in UK corporate history." Goals include financing £1 billion in green energy projects, generating the equivalent of 25 percent of its energy needs with renewable power by 2017, and sourcing roughly 90% of products from the developing world under Fairtrade standards by 2013.
@Bart_King is a freelance writer and communications consultant.