What makes a product unethical?

One question that we get asked a lot is “What is it that makes some products unethical?”

The answer lies in where it’s come from, and where the money is going to. Tim Hunt explains more...

It's there on the screen in front of you, a triumph of design and the latest cutting edge technology, fused together into the next must-have gadget, and for good measure it has an eco-label. You click confidently through to the checkout, your conscience (and soon your bank balance) is clean.

But does that label tell you the whole story? What do you really know about this product? What do you know about the brand that makes it? What, if anything, do you know about the company behind the brand?

You see it’s not just the item itself that’s important when looking at what makes a product unethical or ethical. It’s about what’s happened to get that product in front of you and where your hard earned cash goes to once it leaves your account.

This article will discuss some of those issues and how Ethical Consumer can help you look behind the brand, with examples from the tech, fashion and online retail sectors.

Unethical technology products and brands

The 'black mirror' in front of you hides a collection of parts which come from all corners of the globe and are made of numerous precious metals, plastics, alloys and an array of other elements.

How these individual parts come to be in your device, is a large part of what makes a tech product ethical, or not.

For example, in the technology sector many of the metals needed to make the component parts come from the Democratic Republic of Congo (DRC). This country has been plagued by conflict for many years, a conflict funded in part by the profits from mining the metals that go into our electronic devices. Do you know if your device contains parts whose trade has funded a brutal civil war? How can you know if your device is ethical or not?

How about the manufacture of your device, the process whereby all the individual component parts are assembled to make the device you see in front of you. Was it manufactured in a factory that pays low wages, bans trade unions and makes workers toil over 60 hours a week?

You might also consider how much energy it uses, whether it's possible to fix the product if it breaks, how recyclable it is and how long its likely to last.

Example: Samsung

Let's look in more detail at the lowest scoring brand in our guide to mobile phones, Samsung.

In November 2019, Ethical Consumer rated Samsung’s approach to conflict minerals.

Despite a number of commitments on conflict minerals the company did not explicitly commit to continued sourcing from the DRC and surrounding regions, which was seen as vital to ensure an income for miners and a route out of poverty. The company therefore received a worst rating for this but you won’t see that mentioned on the packaging.

The company also scored a worst rating for supply chain management and has recently been criticised for workers' rights violations in the Asia including the use of child labour. A complaint filed by ActionAid France on 25 June 2018 against Samsung accused the company of misleading advertising as they say Samsung touts ethical commitments to workers' rights that it does not respect in its factories in China, South Korea and Vietnam. Alleged workers' rights violations include child labour, health and safety breaches and other labour abuses

The company also scored negative marks on our rankings system for the irresponsible mining of tin, its toxic chemicals policy and investments in cluster munitions.

Overall the company scores just 4.5 out of 20 for its mobile phones.

Responsible supply chains

The need to manage and take responsibility for supply chains extends to almost all products.

Most products now have very complex supply chains, with component parts or ingredients coming from all over the world.

Let's take a pair of jeans.

The cotton may come from Uzbekistan, the fabric may be woven and dyed in Bangladesh and the buttons manufactured in China. They might all be put together in a Turkish factory before they end up on the high street here in the UK.

All along this supply chain there is the potential for problems if companies don’t take responsibility for managing them in an ethical way. From forced labour and pesticide use in the cotton fields, to the use of child labour and toxic dyes in textile factories and then zero hours contracts and waste issues here in the UK.

At every step along the supply chain there is the potential for a product to become deeply unethical.

Example: Guess Jeans

A good example here is Guess Jeans who sit near the bottom of our guide to jeans.

In July 2019 we rated the company’s cotton sourcing policy.

The Guess cotton policy had a statement saying that it prohibits cotton from Uzbekistan and Turkmenistan and that it was working with suppliers to trace the origin of its cotton in order to enforce this.

The cotton sourcing policy stated that the company had a preference for Better Cotton Initiative (BCI) cotton and Organic cotton and was working to increase the percentage of these in its products.

Sounds good, no? But look a little closer. It did not state what the current percentage was and a search of the website showed that the company sold numerous cotton products that were not labelled as either organic or BCI.

Therefore Guess received Ethical Consumer’s worst rating for its cotton sourcing policy, as consumers could not be sure that some Guess products were not produced using Uzbek or Turkmen cotton and were therefore linked to all the associated problems.

In addition the company scores a middle rating for its supply chain management, a worst rating for its environmental reporting and a worst rating for its use of toxic chemicals.

Overall the company scores just 3 out of a possible 20 for its jeans.

No positive product sustainability?

When we research our shopping guides we also look at a number of product specific questions depending on the sector we are researching.

These can include:

If a product does not have any of these certified standards it is likely to be less ethical.

For example in our guide to chocolate, Plamil, which sits at the top of our rankings table, have positive marks for producing chocolate that is Fairtrade-certified and organic, plus all of the company's products were also approved by the Vegan Society.

At the bottom of the table are a number of Mondelez brands, such as Twirl and Milk Tray, whose products do not hold any of these independent ethical certifications.

Beyond the supply chain

But it doesn’t end with a company supply chain or product labels.

We also look at more general issues with the company. Are they lobbying governments against environmental protection? Are they financing right wing militias in poorer countries? Or are they avoiding paying their fair share of tax?

All these issues feed in to whether the final product in your shopping basket is ethical or not.

Example: Amazon.com

Tax avoidance has been a huge issue over recent years and we rate companies on their likely use of tax avoidance strategies.

Amazon for example is incorporated in Delaware, which is considered a tax haven by Ethical Consumer, despite having its main headquarters in a different state (Washington).

The company also has five significant subsidiaries, all of which were based in Nevada or Delaware, jurisdictions on Ethical Consumer's list of tax havens at the time of writing.

The company also has no country-by-country financial information or reporting (CBCR), nor a clear public tax statement confirming that it was its policy not to engage in tax avoidance activity or to use tax havens for tax avoidance purposes.

It therefore receives a worst rating for the likely use of tax avoidance strategies.

Research from the Fair Tax Mark has backed this up. Amazon has paid just $3.4bn in income taxes this decade, whilst Microsoft has paid $46.9bn. This is a staggering variance, especially as Amazon’s revenue over this period exceeded that of Microsoft’s by almost $80bn. Fair Tax Mark said this means Amazon’s effective tax rate was just 12.7% over the decade when the headline tax rate in the US has been 35% for seven of the eight years under examination.

The company has also been criticised for:

  • Sponsorship of a climate denial think tank conference
  • Spending $27.4 million on lobbying and making $13,633,603 in political donations in 2018
  • Excessive directors remuneration - the highest compensation awarded to an individual in 2019 was US $57,796,739.

Follow the money

However it's not always clear cut.

Some brands may appear ethical but follow the money and you may find they are owned by a company that may have conflicting ethics.

Company ownership

The best example is the burgeoning market for vegan products.

Here we see a number of vegan products that are produced by companies that also sell meat and dairy products.

French multi-national Groupe Danone, a company with a 24.4% share in the global fresh dairy products also produce the popular non-dairy Alpro, Provamel and Soya Soleil brands.

Alpro, which is by far the UK's best known vegan brand, is now part of a brand roster that includes Activa yogurt, Cow & Gate baby milk and Actimel.

Danone are subject to multiple consumer boycotts over their aggressive marketing of baby milk formula.

Other examples include:

  • Pure which is owned by the Kerry Group, whose other well-known brands include Richmond’s sausages, Wall’s Sausages, Dairygold and Cheesestrings.
  • Linda McCartney, currently owned by Hain Celestial, a company who sells poultry products in the US, as well as owning Ella’s Kitchen baby food, much of which contains meat.

Ethical company take-overs

Another issue is take-overs. On occasion, ethical brands get taken over by unethical companies.

In December 2017, ethical brands Ecover and Method were taken over by multinational SC Johnson.

SC Johnson has links to animal testing and so in April 2018 campaign group Naturewatch launched a campaign asking supporters and the general public to contact Ecover and Method, expressing their disappointment at the takeover and pledging to boycott their products until SC Johnson is cruelty-free.

Ecover and Method are themselves cruelty-free and remain Leaping Bunny certified but are no longer endorsed by Naturewatch because of the parent company.

The takeover also led to Ecover and Method both losing marks in our ethical rankings.

  • Ecover dropped from an Ethiscore of 11.5 points to 7.
  • Method dropped from an Ethiscore of 12 points to 7.

SC Johnson (and therefore Method and Ecover) now lose marks for scoring a worst rating in many of the Ethical Consumer categories. This includes a worst rating for:

  • animal testing

  • environmental reporting

  • likely use of tax avoidance strategies

  • toxics.

Shining a light on unethical products, brands and companies….

As you can see from above, here at Ethical Consumer we shine a light on the important issues throughout a products supply chain (and beyond) so that you can tell if a product is unethical or not.

But it doesn’t end there.

We also follow the money so you can be sure that what you spend on a product doesn’t end up in the pocket of an overpaid fat cat executive, a lobbyist, a right-wing political party or a tax haven.

In all we have over 120 guides in 9 sectors all containing information on how unethical (or ethical) a product is based on company ownership (where the money goes) and the 230 categories that make up our unique ethical rating system.

In each guide we give companies an ethical score based on our extensive research. Each product is rated out of 20 but, as we explained above, this is about much more than just what’s in the product's box.

From bread to banks, we cover a range of products in our shopping guides to help revolutionise the way you shop, save and live.