More than half (53%) of UK consumers would never buy from a brand again if it was accused of working with unethical suppliers. Instead, they would look to find an alternative brand that engages in responsible sourcing.
So finds new research from OpenText, which also highlights that the pandemic has made consumers more mindful of the impact of their purchases. Post-pandemic, 82% of consumers plan to prioritise buying from companies that make it clear they have ethical sourcing strategies in place; this compares with 69% who said that pre-pandemic, they prioritised buying from companies with such strategies in place.
The new data – from a survey of 2,000 UK concumers – highlights the importance for brands in proactively ensuring all suppliers in their supply chain operate ethically. The poll considered the extent to which environmentally sustainable and socially responsible business practices matter to the UK public and influence their purchasing behaviour.
The business case for ethical supply chains
Nearly half (48%) of UK consumers judge a brand based not just on its actions, but also the actions of its suppliers. In fact, it appears from the data that consumers place such value on buying from ethical brands that more than three quarters (76%) are willing to pay more if they can be sure a product has been ethically sourced or produced. Three in ten (29%) are willing to spend between 25% and 50% more for that product.
Purchasing ethically sourced or produced items matters to 72% of UK consumers, though a quarter (24%) admit that it has only started to matter to them in the last year or so. The majority (79%) of UK consumers are even willing to compromise convenience, such as accepting a slower delivery, if they can be sure that an item has been ethically sourced or produced. Over half (59%) agree they would only opt for this sometimes or for certain items, but a fifth (20%) are always willing to make this compromise.
“Creating an ethical supply chain requires having visibility into every supplier,” says Lou Blatt, senior vice president and CMO at OpenText. “The ethically minded consumer is exercising more control over their buying power. Brands can no longer claim they act responsibly if they have no visibility into their operations or those of their suppliers.”
Rising demand for ethical business principles
When shopping online, 41% of UK consumers now make a conscious effort to purchase locally sourced or produced items to support local businesses and reduce their carbon footprint.
Almost two thirds (63%) of UK consumers agree businesses have a responsibility to ensure their suppliers abide by an ethical code. More than half (58%) believe that businesses that cannot monitor where their goods have come from and don’t know if suppliers are sourcing goods ethically need to rethink their supply chain.
Three in five (61%) UK consumers agree that government should introduce regulation that holds businesses more accountable for responsible sourcing. The majority (80%) also think online retailers should clearly mark whether or not products are ethically sourced where they can.
Almost three quarters (72%) admit that knowing where a product has originated from or where parts are sourced is important to their buying decision. For 43%, this information always or often impacts their buying decision.
“To build an ethical supply chain, an organisation must have access to information that it can trust,” comments Mark Morley, senior director, product marketing, OpenText. “Having insight into every part of the supply chain not only helps companies live up to customer expectations on ethical business processes, but also allows them to demonstrate how they are doing so. By deploying a single, unified, cloud-based integration platform, organisations can digitise the flow of data and transactions between everyone in the supply chain for complete visibility and transparency.”
“Ultimately, organisations also need to ensure that once they have visibility into their suppliers, they only work with those which can demonstrate their ethical qualifications, performance and compliance,” Morley concludes. “This is vital to meeting rising customer demand for ethical and responsible sourcing strategies.”