From hiring Environment Directors to running charity fundraisers, small businesses and major brands alike are doing more to give back to the planet and society. But can a business be ethical and profitable? ‘Business ethics’ may sound like an oxymoron, but the data shows that ethical businesses actually grow faster than those focused purely on profit.
B Corp certified businesses are a shining example of this. To achieve B Corp status, a company must meet various criteria proving high standards of transparency, accountability, and social and environmental responsibility throughout their policies and practices — an overall high and consistent focus on business ethics from the supply chain through to employees and stakeholders. On average, B Corps grow 28 times faster than the average business. The top-performing B Corps see consumer demand multiplying as much as 14 times over a 5-year period:
|B Corp Company||Average Consumer Demand in 2017 (Google Trends Score)||Average Consumer Demand in 2022 (Google Trends Score)||5-Year % Growth|
|Patients Know Best||3.9||58.1||1390%|
|House of Baukjen||0.8||8.1||913%|
Ethical businesses are more profitable — but why? From consumer behaviour to employee retention, we used online research and an in-house survey to discover the different forces at play in the ethical business movement.
Consumer behaviour shapes brand behaviour: four in five people won’t buy from unethical brands
Raised awareness of social and environmental issues has shifted the consumer mindset towards more responsible shopping habits. With greater access to information via the web and through apps like Good On You, shoppers are doing their research to check that the brands they buy from operate in an ethical way — and those that don’t get the chop.
Our survey results show 70% of people now actively seek sustainable brands to buy from, and 82% would stop buying from an unethical brand completely. We’re currently seeing this in real-time with the fall of fast fashion brands like Missguided.
The most important factor for respondents was how brands treat their staff: 40% said this is the most important thing they expect from brands they buy from, making it more important than vegan/cruelty free products (24%), recyclable materials (20%) and green energy usage (14%).
Achieving B Corp status is important too. A survey conducted in July 2021 found almost 70% of UK respondents would be more likely to buy from a B Corp brand. Since then, interest in B Corps has increased significantly. Our survey shows three in four people have heard of a B Corp, and of these, 84% are more likely to buy from a B Corp brand.
Nine in ten employees would leave a job if their values didn’t align with the company’s
Employees are doing their research, too. With access to company information through the internet, LinkedIn and review websites like Glassdoor, employees can make informed choices about the companies they choose to work for. As a result, businesses with the most extensive employee benefits and social responsibility policies magnetise the best candidates and have the highest staff retention: 91% said they’d leave a company if their values didn’t align.
Our survey results show what employees research about a company before they apply for a role:
1. Glassdoor reviews — 80%
2. Diversity policy — 60%
3. Environmental policy — 40%
4. Charity initiatives — 30%
When asked what the most important company policy is, only 5% said the environment, making it the lowest priority after:
1. Culture and diversity: 39%
2. Transparency: 29%
3. Employee rights: 27%
An ethical business model is key to securing investments and brand partnerships
Investors also take ethical decision-making and policies into account before backing a business. 82% of investors state they’re looking to increase their socially responsible investments, and 72% say they always screen investments for ethical or sustainability risks. As a result, the companies with the most socially responsible practices see the best chances of investment and growth.
Meanwhile, those not prioritising having a positive social impact are quickly dropped by business partners, investors and other potentially lucrative deals. Most recently, style-setting reality show Love Island dropped their partnership with fast fashion brand I Saw It First in favour of eBay to promote sustainability and recycling in the fashion industry. It’s clear that modern companies want to collaborate with those working hard to have a positive impact on both people and the planet, and distance themselves from unethical practices and brands.
Why should a business be ethical? Not just for profit — ethics in business is essential for society, communities and the planet
There are so many reasons why ethical business operations are a must. Creating an inclusive workplace where employees are treated fairly supports staff retention and helps you attract the best talent. Green business operations and a strong environmental policy will attract consumers and investors alike. Ethical business operations go hand in hand with business profit, success and growth. But more importantly, ethics in business helps create a greener, happier world.
At Work.Life, we’re proud to be a B Corp certified business providing sustainable, socially responsible office spaces in London, Manchester and Reading. You can read all about our B Corp status and how we give back to the planet and people here.
Or click here to view our flexible office options for your business.
Survey results were collected through Work.Life’s Instagram using the story poll sticker. 1,650 results were collected in total.