Britons’ annual spending on ethical products and investments has surpassed £100bn for the first time, as lifestyle changes linked to Covid and the climate crisis stoked demand for plant-based foods, secondhand clothes and furniture, and greener gadgets.
The value of the “green” pound surged by nearly a quarter to £122bn in 2020, according to a new Co-op report covering the most recent year for which figures are available. That total was bolstered by £57bn of ethical savings and investments.
Shoppers spent £61bn on ethical products and services, which was nearly 30% more than in 2019. That equates to £2,189 a household, a £489 increase. The equivalent figure for 2010 was £1,028.
The retailer’s ethical consumerism report, which is a barometer of the extent to which consumers’ shopping habits reflect their concerns about the environment, animal welfare and social justice, also found more shoppers were boycotting brands on ethical or social concerns. These businesses suffered a £3.9bn loss of sales, which was £600m bigger than the previous year.
Steve Murrells, the Co-op’s chief executive, said shoppers were “turning up the heat” to get companies to change. The boycotts were a “warning to brands that they must do business in a better way for workers, communities and the planet”, he said.
The huge increase in ethical spending also showed that when businesses provide choice, and the government offers helpful incentives, “consumers will respond positively”, Murrells added.
The area of the market that saw the biggest increase was eco-travel and transport, where sales rose by more than 70% to £12.2bn. This reflected the rise in electric car ownership as well as the impact of the pandemic, which revived cycling to levels last seen in Britain in the 1960s.
Britons are also trying to make their homes greener by investing in energy-efficient boilers as well as other household appliances or switching to “green” electricity deals. Taken together this market had expanded by a third to be worth £20.5bn.
However, this push fell short of what is needed to hit the government’s net zero targets, the Co-op said. For example, while households spent £5bn on energy-efficient gas boilers, just £130m went on heat pumps.
The report also highlighted the growing appetite to buy secondhand goods, be it for financial or environmental reasons. Sales of secondhand clothes increased by nearly a quarter to £864m while spending on “pre-loved” furniture was up by more than £100m at £837m.
In the now £14bn ethical food and drink market the sales trends reflect people making changes to their diet, with demand for vegetarian and plant-based foods up 34% at £1.5bn. Fairtrade and organic food also grew strongly, up 14% and 13% respectively, while free-range egg sales exceeded £1bn for the first time.