The classic image of an ethical brand is that of a small, mission-minded, upstart enterprise. As ethical awareness increases and responsible business practices spread, that image is in need of a rethink
The classic image of an ethical brand is that of a small, mission-minded, upstart enterprise. As ethical awareness increases and responsible business practices spread, that image is in need of a rethink
Albert Einstein once said: “Relativity applies to physics, not ethics.” The phrase appeals for its simplicity. Ethics deals in absolutes and certainty, not relativity. Theft is bad, charity is good, and so forth.
Transfer Einstein’s concept to branding and the same unequivocal notions can be found. Ethical brands, by definition, are good.
But are they? Well, maybe. In marketing terms, at least, the answer is a muted “yes”. Most consumers perceive niche ethical brands to be cleaner, greener or generally more wholesome.
In objective terms, however, the case is sometimes harder to make. Most ethical brands tend to be narrowly focused. Their founders identify a problem, and create a brand to solve it. That’s what ethical brands do.
So organic food company Duchy Originals champions non-chemical agriculture. Confection firm Divine Chocolates makes lives better for Ghanaian cocoa farmers. Cleaning products company Ecover keeps chemical detergents out of the water system.
No one questions their strength on their ethical issue or issues of choice. But how good are an eco-brand’s employment policies? Or how transparent are an organic producer’s lobbying efforts?
Business is business
Behind every brand lies a business, widgets and all. A truly ethical brand must ensure its back office is whiter than white, not just the objects in its shop window.
In truth, ethical brands rely heavily on relativity. They depend on being more ethical than other brands.
And times are changing. Companies such as Marks & Spencer, with its Plan A strategy, are moving aggressively into the ethical space. Even historical villains are getting in on the ethics game. Few companies have been more cursed by campaigners than US monolith Wal-Mart. Yet the world’s largest retailer is demanding exacting ethical standards of all its suppliers.
The ethics of traditional ethical brands can be relative too. Value positions change over time. Low-energy light bulbs might have been a leading campaign issue a few years ago; now they are standard.
The need to reconsider and possibly reinvent is constant for ethical brands. Take the Co-operative Bank. For much of the 20th century, it clung to values dating back to the Victorian era. A hugely successful revamp in the mid-1990s saw customers flocking back in droves.
“Ethical brands tend to grow slowly .The world in which they operate changes. And the issues that set pioneering brands apart often no longer look so cutting-edge 20 years on,” says Mark Mansley, investment director at Rathbone Greenbank, a subsidiary of investment management firm Rathbones.
If ethical brands cannot be defined exclusively by their ethics, then what else can they be known for? Their size. Most ethical brands are small. And, as we know, small can be beautiful.
Being small is not just about aesthetics. It allows brands to operate in, and profit from, niche markets. In addition, smallness often translates to fleetness of foot. Communications provides the archetypal case in point. Ethical brands are renowned for their wacky, edgy and personal messaging. How many corporations can sign off an earnings statement “Ben” and “Jerry”?
Yet as the ambitions of the ethical market grow, so must brands’ size. An ethical enterprise’s influence is directly proportional to its market share, argues environmental activist and business adviser Julia Hailes.
“In order to have the benefit of an environmental product, the more non-environmental products it replaces the better,” she says. The same is true for ethical products in general.
The deep pockets and wide sales reach of a corporation can appear enticing to niche players looking to expand. And the entrepreneurial skills that it takes to create a brand from scratch are not necessarily the same as those needed to boost growth.
Little surprise that many niche companies are selling out and sizing up. Hip ethical clothing brand howies, for example, recently signed a tie-up with US retail giant Timberland. The catalogue-only business now has a presence on the high street.
Craig Sams, founder of Fairtrade confectioner Green & Black’s, didn’t mince his words when a majority stake in the company was sold to global confectionery company Cadbury. “If we really want to make a difference to the level of operation and really support the farmers there,” he said, “we need Cadbury.”
As ethics become more mainstream – and arguably as the mainstream becomes more ethical – the lines between ethical brands and the rest are blurring.
Perhaps that’s no bad thing? There is no objective, all-encompassing definition for an ethical brand; there never has been. Ultimately, being ethical is a marketing decision. Brands say they are ethical: finito.
The onus then falls on the consumers to believe the brand or not. Media interrogation, third-party certification and the brand’s own employees will help inform that decision. As consumers begin to “look behind the label” – to steal Marks & Spencer’s former tag-line – the integrity of ethical claims will increasingly be called into question.
The Brazilian philosopher Vademar Setzer got it right when he said ethics were “not definable” but instead “involved our thinking, but also our feeling”.
Innocent Drinks is widely heralded as an ethical brand. In reality, it makes no explicit claim as such. Generous, natural, fresh, sustainable: these are among the words it uses to define itself. “Ethical” is a prefix added by the consumer, not the company. Surely that’s the ultimate test of any ethical brand.
Ethical acquisitions and investments: what the founders say
Innocent Drinks: sells 10-20% stake to Coca-Cola, 2009
“Basically, we’re dead excited about the investment. The funds raised allow us to do more of what Innocent is here to do – get natural, healthy stuff out to as many people as possible.” Co-founders Richard Reed, Jon Wright and Adam Balon
Abel & Cole (organic delivery service): sells share to private equity firm Phoenix, 2007
“Up until this, the business was completely private and that’s not a great thing for a business of this size because essentially every piece of risk is being taken by myself.” Co-founder Keith Abel
Tom’s of Maine (health products): bought by Colgate-Palmolive in 2006
“We have a commitment from Colgate that our formulas will not be tampered with ... We chose Colgate as our partner because they have the global expertise to help take Tom’s of Maine to the next level.” Co-founder Tom Chappell
The Body Shop: acquired by L’Oréal in 2006
“I do not believe that L’Oréal will compromise the ethics of The Body Shop. That is after all what they are paying for and they are too intelligent to mess with our DNA.” Co-founder Anita Roddick
Green & Black’s (chocolate): Cadbury buys majority stake in 2005
“We’re bumping up against the available supply of cocoa beans, and we need their help to expand … If we really want to make a difference to the level of operation and really support the farmers there, we need Cadbury.” Co-founder Craig Sams
Ben & Jerry’s: bought by Unilever in 2000
“While we and others certainly would have pursued our mission as an independent enterprise, we hope that, as part of Unilever, Ben & Jerry’s will continue to expand its role in society.” Co-founders Jerry Greenfield and Ben Cohen
Rachel’s Organic: bought by Horizon Organics in 1999
“We have ensured that the demand for organic food is still out there and in that time we have persuaded other farmers to produce organic food.” Founder Rachel Rowlands
Seeds of Change (organic seed and food company): bought by Mars in 1997
“Mars is interested in providing what consumers want. If that’s organic food, then Mars wants to be able to satisfy that demand.” Co-founder Howard Shapiro