British annual spending on ethical products and investments topped £ 100 billion for the first time, as lifestyle changes linked to Covid and the climate crisis fueled demand for plant-based foods , second-hand clothing and furniture, and greener gadgets.
The value of the ‘green’ pound jumped almost a quarter to reach £ 122 billion in 2020, according to a new Co-op report covering the most recent year for which figures are available. This total has been bolstered by £ 57 billion in ethical savings and investments.
Buyers spent £ 61bn on ethical products and services, almost 30% more than in 2019. This equates to £ 2,189 per household, an increase of £ 489. The equivalent figure for 2010 was £ 1,028.
The retailer’s ethical consumption report, which is a barometer of the extent to which consumers’ buying habits reflect their concerns for the environment, animal welfare and social justice, also found that more buyers boycotted brands for ethical or social reasons. These companies suffered a loss in sales of £ 3.9bn, £ 600m more than the previous year.
Steve Murrells, chief executive of the co-op, said buyers are “mounting the pressure” to get businesses 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 has also shown that when businesses offer choice and government offers useful incentives, “consumers will respond positively,” Murrells added.
The sector of the market that saw the largest increase was eco-travel and transport, where sales rose by more than 70% to reach £ 12.2 billion. This reflected the increase in the number of electric car owners as well as the impact of the pandemic, which revived cycling to levels never seen in Britain in the 1960s.
The British are also trying to make their homes greener by investing in energy efficient boilers and other household appliances or switching to “green” electricity offers. Together, this market has grown by a third to reach £ 20.5 billion.
However, this push has fallen short of what is needed to meet the government’s net zero targets, the cooperative said. For example, while households spent £ 5bn on energy efficient gas boilers, only £ 130m was spent on heat pumps.
The report also highlighted the growing appetite for buying second-hand goods, whether for financial or environmental reasons. Second-hand clothing sales increased by almost a quarter to £ 864million, while spending on ‘pre-loved’ furniture rose by over £ 100million to £ 837million .
In the now ethical £ 14bn food and drink market, sales trends reflect changes to their diets, with demand for vegetarian and plant-based foods rising 34% to 1.5 billion pounds sterling. Fair trade and organic food also rose strongly, up 14% and 13% respectively, as free-range egg sales topped £ 1 billion for the first time.