Coca-Cola, Kraft and Procter & Gamble have the best ethical reputations in the United States, while continental Europeans identify Adidas, Nike and Danone as the top ethical brands and the U.K. gives high marks to the Co-op, Body Shop and Marks & Spencer but generally favor non-governmental organizations over corporations.
A new study by GfK NOP, highlights both the need for businesses to address ethical issues and the market opportunities for businesses which have developed ethical policies, brands and products.
Ethical brands are becoming more widely accepted worldwide, the survey suggests. Nearly one in three (31 percent) consumers said buying ethical products makes them feel good. Only 18 percent of the 5,000 consumers surveyed thought that ethical brands were just a fad, and 43 percent said they thought ethical brands made businesses more accountable for their actions. Only one in four (24 percent) don’t believe the hype around ethical products.
At the same time, almost half of the consumers surveyed in the U.S., U.K., France, Spain and Germany thought that corporate ethical behaviour had declined. This was particularly evident in the Germany and the U.S. About two-third (63 percent) said that companies in general are “only out for themselves these days.”
U.K. consumers are the most ethically aware, and have identified businesses with clear ethical policies, products and services as the most ethical. An impressive 62 percent of U.K. consumers took the view that ethical brands are making the world a better place.
In other countries, this trend is not as obvious, as consumers from the U.S., Germany, France and Spain have conflicting views on multi-national corporations and their ethical policies.
In the U.S., Coca-Cola, Kraft and P&G were joined in the top 10 ethical brands by Johnson & Johnson, Kellogg’s, Sony, Ford, Toyota, Levi Strauss, and Starbucks. In the U.K., Tradecraft, Cafedirect, Ecover, Green & Black, Tesco, Oxfam and Sainsbury’s round out the top 10 after the Co-op, Body Shop, and M&S.
In France, Danone, adidas and Nike were top rated, followed by Nestle and Renault. In Germany, adidas, Nike and Puma took the top spots, followed by BMW and Demeter. In Spain, Nestle, Body Shop, and Coca-Cola finished ahead of Danone and El Corte Ingles.
One third of all people questioned said that they were willing to pay a 5 to 10 percent premium for ethical products.
However the definition of ethical corporations does come into question, illustrated by a majority of consumers stating they had little interest in typical CSR programs such as charitable donations, sustainability and local community activities. Environmental policies and employee relations were more credible features of ethical companies. More than half (56 percent) of those questioned believed that companies should actively promote their ethical credentials and policies.
Says Chris Davis, head of GfK NOP’s brand strategy centre of excellence: “Ethical consumption is perhaps the biggest movement in branding today. Corporate behaviour is under intense scrutiny, with corporate policies now clearly posted on the internet. Consumers worldwide are developing their own definitions of ethical practices and are voting with their wallets. While this poses a great opportunity for many businesses in the development of products and services, for some, it is a wake up call to address the demands of the growing number of ethically-aware consumers.”