How to become an ethical business in 2020?

By Shay Doran

20 years ago the retail fair-trade market was worth £21.8m. Now, U.K consumers spend £290m per year on fair-trade bananas alone!1 We know an ethical business wave will hit, perhaps slightly delayed given recent developments, never the less, it’s not far off.

Not sure where to start or who should own it?

This 6 minute read from Green Revolt will show how your business can become more ethical in 2020. You’ll understand 3 business ethics examples that apply to any type of retailer, learn how to decide if one is more important than the other and how to create ethical business change.

At GreenRevolt.co.uk we show businesses how Ethical = Profitable. We help ethical companies to scale faster, and work with established businesses in global markets, to deliver commercially viable, ethical change.

Back to the story of recent developments. Coronavirus will reveal how quickly the planet can recover, given a major chance to do so. We’re already seeing big signs of this happening.

The average number of good quality air days in Hubei province, China, is up 21.5% on last year. In Hong Kong, fine particle pollutant (PM2.5) decreased by 32% in February2. Added alongside the huge reduction in CO2 that is about to come our way through reduced transportation, you can start to imagine what the data will reveal.

Facts will be laid bare and without a doubt more focus will be on how we return to running business in a way that reduces our impact. If there are practises being followed that don’t feel right, they will be exposed and the result can mean game over for any business.

business ethics article

Later on in this post, we explain why it’s important to ask bold questions before making a move. The right questions and experiments will set you up for long term, impressive change, flowing in the same direction as your business rather than against it.

Many companies are making a reactive or proactive move to try and ride this wave. Creating a better place to work, becoming more responsible as a producer, or by increasing sustainable business practises. Though be it re-active or pro-active, a lot are knee jerk reactions that in themselves aren’t built for the long term.

We’ll also explain why these types of changes should, in the majority, come from teams bottom up rather than top down from CEOs. Before all that happens, your teams have to understand what’s going on & why. What’s causing these shifts & where can they begin to create new ideas for the business. Educating teams on how to experiment in ways that link with business goals. Then finally, making commercially viable, ethical change happen.

If there are practices being followed that don’t feel right, they will be exposed and the result can mean game over for any business.

business ethics examples

3 business ethics examples:

Ethical changes are far ranging and can begin in many different places. To keep this simple, here are 3 examples of ethical changes that can apply to any business. I’ll call each by their purpose:

Cost saving - making ethical changes to business processes that will actually save money. Like reducing the amount of packaging used for each purchase / bulking up multiple deliveries to cut down on transportation costs / increasing workplace efficiency - work from home days, powering off at night, solar energy usage.

Future sustainability - this is about changing todays business practices into long term commercial & sustainable solutions. For example - having a real plan to reduce your companies carbon footprint / sourcing longer lasting or even degradable production materials / switching to natural based products and away from man made chemicals.

New customer growth - yes! Ethical means new customer growth. Especially for the younger generation. 49% of those aged under 24 avoid products because of their negative environmental impact3. Digital word of mouth spreads fast. New growth examples - marketing product changes to specific audiences / releasing new ethical lines to experiment with / giving your customers more choice to minimise their own impact - reduced carbon footprint delivery or the option to select different types of packaging.

None of the above changes may be breaking news to you, though where is your progress to date?

Ethical means new customer growth. 49% of those aged under 24 avoid products because of their environmental impact.

What type of ethical business change should I make?:

Ethical changes should be commercially viable (not loss making) and align with your business goals. When deciding what type of change would work for your business, you want to avoid a “we need to do something so let’s do this” approach. It should be an intentional thinking process, one that your teams are empowered to make.

Think about your customer, research showed us that most brands actually get in the way - more to come on that research later on.

Once that part becomes clear, the next step is to ask the bold questions I mentioned at the start. What KPI’s will show you that customers find this change more valuable? An example could be - customers who opt for reduced delivery packaging score 20% higher in satisfaction surveys. How will you know if the change is successful? At what point will changes become suitable in other markets? We show our clients how to follow experimentation methodology before fully launching business wide changes, making sure you see results first.

Overall steps to take - look at your businesses goals, give teams the power to create new ideas that achieve your goals by becoming more ethical. Review the profit impact of each change option, experiment with no more than 3 at one time and then implement based on the results.

Ethical changes should be commercially viable and align with your business goals.

business ethics principles

Is one more important than the other?

Numbers talk, there will of course be changes that are more attractive, though may not be the best for you right now. If you follow practices that make you feel nervous, or don’t feel right, I’d advise you to focus on that first.

If your goal is to scale, changing something that brings new customer growth compared to cost saving would be a better starting place.

So the answer is yes. For your business, one type of ethical change will be more important than the other. Done in the right way, this should be an obvious choice that allows you to make results based decisions. It doesn’t need to be the board or company leaders who decide, most of this should come from your teams - imagine the response to a colleague idea generation challenge, “how do we achieve our goals by becoming more ethical?” Or “how do we scale in a way the doesn’t clash with our purpose”. A lot of the thinking is already around you.

Taking this approach means you can filter through the ideas, find the most important ones to experiment with, learn which to scrap and which to permanently implement.

Followed correctly, this should be an obvious choice that allows you to make results based decisions.

Summary:

Ethical business changes are far ranging and deep, it shouldn’t be a ‘stab in the dark’ approach.

Profitable, ethical change, can and should be understood, well thought through by teams bottom up, experimented with and rolled out in that order.

Times are changing, what was once allowed as normal business practise will no longer cut it. We’ve all seen this change start to happen and it will only accelerate. Consumers are ready for more choice. 43% say that brands get in the way, making it harder for them to be environmentally friendly and ethical in their day to day life4. So instead, be someone who helps them.

By Shay Doran, Founder - Green Revolt!hello@greenrevolt.co.uk

Sources:

1: https://www.ethicalconsumer.org/sites/default/files/inline-files/Twenty%20Years%20of%20Ethical%20Consumerism%202019.pdf

2: https://edition.cnn.com/2020/03/16/asia/china-pollution-coronavirus-hnk-intl/index.html?utm_source=fbCNN&utm_medium=social&utm_content=2020-03-17T11%3A30%3A05&utm_term=link&fbclid=IwAR2Pzdd3J0Bri6R-bVZ2BaHsff05dfUpjcFqRUPvnDG_s6ltxEiWrzbLl90

3: https://www.triodos.co.uk/articles/2018/the-rise-and-rise-of-the-ethical-consumer

4: https://www.forbes.com/sites/solitairetownsend/2018/11/21/consumers-want-you-to-help-them-make-a-difference/#3b3bebd76954

 

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