A Guide to Ethical Shopping

Many people these days want to put their money where their beliefs are and shop more ethically. That might mean supporting brands and retailers that do less harm environmentally or are actively promoting a healthier planet. Or, it could mean favoring products from companies that are transparent about the fairness of their labor practices or the charitable efforts they undertake. Just how popular is ethical shopping? Research suggests that as many as 75% of shoppers consider a company’s ethical practices as important in their buying choices.

Finding out which businesses are doing the right thing and which aren’t, however, isn’t always easy. Plus, many people may worry that ethical consumerism just isn’t affordable.

Here’s help and reassurance. Read on for guidance on how to be a more conscious consumer, as well as how it may even save you some cash.

What Ethical Shopping Really Means

The term “ethical shopping” essentially boils down to people becoming more aware of the goods they are buying.

What’s “ethical” is subjective to each person, but finding out how each product is made, if the company supports fair labor and other socially responsible practices, and if the product is environmentally-friendly is a great place to start.

Money has a lot of power, so if people choose ethically-sourced and ethically-produced products more often, more companies may want to jump aboard the ethical and sustainable shopping train.

Since ethical consumerism is all about where our money goes, investing in companies that you believe are doing good in the world can also play an important part in consuming ethically.

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Issues You May Want to Consider

Many companies — particularly clothing producers — have been called out for their outsize impact on the environment. According to the United Nations (UN), the fashion industry is the second-biggest consumer of water and is responsible for about 10% of global carbon emissions – more than all international flights and maritime shipping combined.

It may also be important to you to consider who is making that product and how that worker is being treated. Are the workers at the factories working in safe conditions? Are they being paid fairly? Seeking out companies with fair labor practices, including fair pay and benefits, can be important to many consumers.

You may also want to consider how well a company treats its suppliers. For example, does your favorite coffee shop pay its farmers a fair amount for their beans?

For some consumers, how a company treats animals is also an important consideration.

Ethical Shopping Made Easier

Once you know what to look for, you can research your favorite brands to learn how they measure up on ethics and sustainability.

You can find out a fair amount about what your favorite companies stand for by going to their websites and digging in their About Us, FAQ, and Info pages to judge for yourself. Generally, the more detail they provide, the better.

Do you see a step-by-step explanation of their supply chain? Do they proudly say that employees have paid sick leave? Or, even better, do they have any ethical certifications (more on that below)?

There are also a number of groups and organizations that are dedicated to making social and environmental data available to consumers who are interested in ethical shopping.

In other words, they’ve done the vetting for you. Here are a couple to check out.

Better World Shopper

This public research project rates over 2,000 companies based on their track records on human rights, the environment, animal protection, community involvement, and social justice.

Good On You

Focused on fashion and beauty brands, Good On You assesses how brands impact people, the planet, and animals on a five-point rating scale, from “We Avoid” to “Great,” to indicate a brand’s sustainability performance. The app and website allow users to search for brands and see their ratings, as well as detailed information about the factors that contributed to the score.

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Understanding Labels and Certifications

To become a more ethical shopper, it helps to understand which terms are meaningful and which terms aren’t worth much.

Companies are increasingly using the word “sustainable” to describe their products or the process of making them. However, that term can mean just about anything the retailer wants it to, since the word’s use is not regulated with any oversight (unlike the word “organic,” which comes with more stringent guidelines for use).

“Natural” can be confusing, too. Many natural fibers tend to have a lower carbon footprint than synthetic fibers because they do not use as many chemicals during the production process.

But just because something is “natural” doesn’t mean it’s more eco-friendly. For example, cotton takes up a lot more water to produce than other fabrics.

Fortunately, there are labels, or certifications, that do carry weight. You may want to keep an eye out for the common ones below.

•  B-Corp. B Lab’s B-Corporation certification signifies a company’s commitment to upholding high human rights and environmental standards, and is based on a rigorous assessment.

•  GOTS Organic. A textile product carrying the Global Organic Textile Standard (GOTS) label must contain a minimum of 70% certified organic fiber. Organic fibers are grown without the use of synthetic pesticides, insecticides, or herbicides and GMOs (Genetic Modified Organisms). Organic agriculture is a production process that sustains the health of ecosystems, soils, and people.

•  Made in the USA. To use this label, all, or virtually all, of the product has to be made in America. Products produced in the U.S. must comply with U.S. laws for workplace safety, pollution, and health. Also, the carbon footprint of these products is likely to be lower because they don’t have to be shipped from overseas.

•  Fair Trade. When you see a product with the Fair Trade Certified seal, you can be confident it was made according to rigorous social, environmental, and economic standards. Also the farmers, workers, and fisherman behind the product earn additional money from your purchase to help uplift their communities.

Think Globally, Shop Locally

One simple way to shop more ethically is to shop locally. You can often find unique and interesting products by shopping with local, independent retailers.

People can also make a big difference by spending their dollars at mom-and-pop shops around them. For one reason, independent businesses are more likely to have localized supply chains. So shopping at one local store could potentially help bolster not just that store but also more of the local economy.

Local shopping also helps reduce carbon emissions, since a consumer may end up driving less. And if a shopper buys food grown near them, the product will not need to be shipped via air or sea, meaning its carbon footprint will be lower. As a bonus, buying local produce could also mean it’s fresher too, potentially making for tastier (and more ethical) meals.

Although local goods may be slightly more expensive, businesses may offer coupons to entice consumers to buy from them.

Consider Buying Secondhand

It’s nice to think about buying a shiny new thing, but before you pull the trigger, you may want to consider, does this need to be purchased new?

Buying secondhand can be more economical, as well as more environmentally-conscious. It keeps older items from ending up in landfills and, unlike buying a brand new product, no new item needs to be produced to directly replace it.
If you’re thinking about buying a new bike, for example, you might get just as much pleasure from getting a gently used bike through an online secondhand marketplace.

The same holds for clothing. Gently used garments are one of the greenest clothing choices you can make because they require no additional resources to produce and they reduce the amount of textile waste going into landfills.

Plus you can often score quality clothes on the cheap at thrift stores, garage sales, and online marketplaces where people sell their unwanted stuff. Another option is to organize a clothing swap with a group of friends.

Secondhand pieces typically cost less than new clothes bought on sale. In addition, they may feel much more unique, as fewer people around town will likely be sporting the same exact item.

Do You Really Need the Product at All?

Ethical shopping also means thinking about if you really need to shop at all.

Sometimes it’s okay to just say “no” to buying the latest and greatest and simply spend less money. Sure, there’s a new phone on the market that’s cool, but do you really need it?

Becoming an ethical shopper means asking yourself this question a lot. It’s easy to give in to society’s pressure to buy new and buy often, but part of becoming a more conscious consumer is to start thinking in a different way, especially when you’re shopping online.

“Combat the urge to impulse spend by instituting a holding period on all purchases,” advises Brian Walsh, CFP® and Head of Advice & Planning at SoFi. “Before hitting the buy button, wait 24 to 48 hours. After the holding period, come back to the shopping cart and reevaluate. In some cases, you might not even remember why you wanted it in the first place.”

Another way to nip unnecessary buying in the bud is to employ the 30-day purchase rule. If you find an item you like but don’t need immediately, agree to walk away for 30 days.

If, after the waiting period, you feel you still really want the product and can afford it, you can then choose to go back and buy it. However, the odds are fairly good that a little bit of time and space will prove that a nonessential item is just that.

Tracking Spending Can Help

One way to become a more conscious and ethical shopper is to start tracking your spending as part of whatever budget method you choose.

Looking over your checking account and credit card statements each month can help you see exactly where you are spending your money (and where you may want to cut back), while also pointing out vendors and shops you may no longer want to patronize (such as an out of the way mega-grocery store).

Recommended: Savings Calculator

The Takeaway

Whether it’s clothing, food, or tech, many of the products we love to buy are associated with unethical practices, from human rights abuses to environmental harm.

Ethical shopping is about supporting companies that put in the work to make things better for people, as well as the planet. It’s also about choosing not to buy from brands that violate your code of ethics. While the process may seem intimidating, it’s easy to start buying more ethically with the right tools and information, plus a little research time. It may help you reduce your spending and make other smart decisions with your money too.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

How do I shop ethically?

To shop ethically, research brands’ practices, choose products with fair trade certifications, and support local and small businesses. Look for items made from sustainable materials and check if companies have transparent supply chains. Buying secondhand or upcycled goods can also reduce waste. Finally, read reviews and join communities that advocate for ethical consumption to stay informed.

What is ethics shopping?

Ethical shopping, or conscious consumerism, involves making purchasing decisions that align with moral values and social responsibility. This includes supporting fair labor practices, environmental sustainability, and animal welfare. Ethical shoppers often look for certifications like Fair Trade, organic, and cruelty-free, and prefer brands that are transparent about their supply chains and production processes. The goal is to minimize negative impacts and promote positive change.

How can I tell if a product is ethically sourced?

To determine if a product is ethically sourced, look for certifications like Fair Trade, GOTS Organic, and B-Corp. Also check the company’s website for information on their supply chain, labor practices, and environmental policies, and read product labels for details on materials and manufacturing. Customer reviews and third-party audits can also provide insights.

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