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Ethical shopping up despite economic downturn

30th December 2010 Print

Expenditure on green goods and services grew 18 per cent over the past two years despite the economic downturn, it was revealed today.

According to The Co-operative Bank's annual Ethical Consumerism Report, the overall ethical market in the UK was worth £43.2 billion in 2009 compared to £36.5 billion two years earlier. The growth was despite a two per cent fall in overall household expenditure in the last year. However, ethical spend remained a small proportion of the total annual consumer spend of some £700 billion.
The report, which has been acting as a barometer of ethical spending since 1999, analyses sales data for various sectors including food, household goods, eco-travel and ethical finance.
Ethical consumerism's winners and losers through the downturn

Freedom Food
Ethical Banking  

Organic food
Rechargeable batteries
Real nappies

Over the last two years, expenditure on ethical food and drink increased 27 per cent to reach £6.5 billion, representing eight per cent of all food and drink sales. Fairtrade food grew by 64 per cent to reach £749 million, while sales of animal welfare Freedom Food certified products tripled in two years to reach £122m. Sales of organic food fell by 14 per cent to £1,704 million.
Ethical personal products, including clothing and cosmetics, were the fastest growing sector, increasing by 29 per cent to reach £1.8 billion. The market for green home products such as energy efficient appliances was more stable, growing by eight percent in two years to reach £7.1 billion.
Ethical finance increased by 23 per cent to reach £19.3 billion between 2007 and 2009, helped by a 'flight to trust' among consumers disenchanted with much of the financial services sector.

Tim Franklin, Chief Operating Office at The Co-operative Financial Services, said:  "This annual report clearly shows that the growth in ethical consumerism continues to outstrip the market as a whole. I have no doubt that this will come as a surprise to those commentators who thought ethical considerations would be the first casualty of an economic downturn.
"However, whilst the rapid growth in areas such as Fairtrade and ethical finance, which we have witnessed in previous years, continues, other areas such as micro-generation and renewable electricity have unfortunately failed to make significant progress. We welcome the introduction of feed-in-tariffs for household renewable generation, and would hope to see the impact of these come through in future years' reports.
Consumer commitment to ethical products has remained strong through the downturn, however it is clear that ambitious legislation is needed to enable the mass-market take-up of low carbon lifestyles."