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Progress is a process

Ethical spending is rising, and the movement proves habits are changing

Ethical spending is rising, and the movement proves habits are changing

Huw Davies, head of retail banking at Triodos Bank explains that despite a stagnant economy, ethical spending has increased by 8%. Since consumers are actively making the decision to spend responsibly, it shows that the collective power of individuals are making a huge difference to addressing social and environmental challenges.

“Why do people choose to shop ethically? A big part of it is down to individuals doing what they can to make a difference in their own lives.”

Huw Davies, head of retail banking, Triodos Bank

Huw Davies (3) Each and every one of us has a role to play in tackling the pressing social and environmental challenges facing us and creating the society we want to see. And making conscious choices about how we use our money – the products we buy, the companies we buy from and the banks we entrust it with – is one of the most powerful ways each of us can make a difference.

We are delighted to have sponsored 2015’s Ethical Consumer Markets Report, which demonstrates that despite continuing economic hardship, people are making those conscious choices, and at a growing rate. The value of ethical sales grew by 8%, during a period when inflation barely rose above 0.5%. And the overall value of ethical market grew from £35bn to £38bn showing a continued commitment from consumers across all sectors to support more ethical products and services.

The value of money held ethically fell by 2%. This was caused by accounts being closed or moved from the Co-operative Bank, rather than reflecting on the ethical money sector as a whole. All other elements in the sector – including savings and investments with Triodos Bank – showed year on year growth. Combined ethical money and ethical spending totals rose from £78bn to £80bn.

“They’re actively doing what they can to address the social and environmental challenges facing us today rather than waiting for others to come up with the solutions.”

Huw Davies, head of retail banking, Triodos Bank

In the food and drink sector, 2014 saw the first ever fall in a value of Fairtrade sales (4%) since the scheme began. The sector grew overall with a revival in organic sales, strong growth in sustainable fish sales, and a good performance in other ethical food sectors.

Tesla factory

Sales of electric, hybrid and other tax-band A-rated cars grew by 40% to nearly £7bn, and spending on solar panels rose by nearly 25% to £716m. Photo: Tesla

Why do people choose to shop ethically? A big part of it is down to individuals doing what they can to make a difference in their own lives. They’re actively doing what they can to address the social and environmental challenges facing us today rather than waiting for others to come up with the solutions. Part of it is that ethical products can be trusted, are often better quality and have transparent supply chains. And part of the reason is just the feel-good factor of knowing you’re doing the right thing.

The report’s findings are a very positive sign for ethical consumption, and for the growing movement of people who are making conscious choices with the money. And who, in doing so, are actively addressing the social and environmental challenges facing us today rather than relying on others to come up with the solutions.

words: Huw Davies

You can see the full Ethical Consumer Markets Report here.

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Joel 2 years ago

I am invested with you in your 2 ethical mutual funds and in this article it says that the value has risen over the past year. I invested in February 2015 and the value of the investment is now less than I put in. If on average ethical sales increased 8% then why are your investment managers struggling to make any money? Could you also explain the discrepancy between what this article says and the reality of what I am seeing with my accounts with you?

Reply to Joel
Will Ferguson 2 years ago

The Triodos SRI funds invest in larger listed companies with superior sustainable performance. Many of these are global and as they’re listed can be subject to broader trends in the stock markets which have been down over the last year – for instance yesterday the FTSE100 was at its lowest level since 2012 and was down 17% over the last year. In the year to January 31, the latest figures available, our funds grew by 4.1% and 7.4%.

The growth highlighted in the ethical consumer report refers to the amount spent in the UK ethical market, so reflects spending on areas such as organics, fairtrade, renewable energy and so on, rather than the share price of the companies in this market, many of which are smaller and unlisted.

Better Food | The Colour of Money | Triodos Bank 1 year ago

[…] we have reported that ethical spending is growing; the same can be said for organics. The Soil Association’s 2016 Organic Market Report has […]