Ethical Business Practices
There's a common saying: "consumers vote with their dollar." With the growth of social media and eCommerce, consumers gain access to a wide range of products and prioritize brands that align with their beliefs. In recent years, consumers have become more aware and concerned about the final product and the ethical and sustainability practices of its supply chain. Global supply chains are complex and are located in various nations, which can make it difficult for businesses to understand their suppliers' practices at every level. In response to consumers' demand and behavior change, companies are now expected to pay closer attention to how they source, manufacture, and distribute their goods. Transparency regarding businesses' supply chains has become more critical than ever to consumers.
The Triple Bottom Line
Before, businesses prioritized maximizing profit margins. Now, great companies prioritize purpose. Once a firm operates to fulfill its purpose, profits inevitably will follow. It is not enough to only consider economic gains, but include environmental and societal responsibility as well. This is known as the triple bottom line.
As a business, this principle is essential to consider at every level of its operation and not only to its supply chain. Being transparent about its practices is vital to establish themselves as a trustworthy source as trading partners or suppliers. As consumers, we must consider these factors when purchasing from a retailer, vendor, or distributor.
Philanthropy & Greenwashing
Philanthropy is the act of donating capital or providing resources to promote the welfare of others. Recently, many companies realize the importance of giving back to employees, communities, and the environment. They take a share of their profits to help solve complex social problems that the government and the private sector have not, such as inclusive family policies, reducing wealth inequality, or divesting from unethical commitments.
At first glance, this may seem like a positive act. But as a conscious consumer, we must consider whether a business' philanthropic initiatives are genuine or not! Some companies are known to participate in philanthropy to gain a positive brand image, yet they continue to exploit communities and the environment for profit within their supply chain. This is known as greenwashing. It is vital that businesses engage in philanthropy but also ensure that other aspects of their operations are ethical and sustainable. If not, the philanthropic initiatives are created only to distract consumers from other parts of businesses' operations.
What are examples of ethical supply chain practices?
You may wonder how we can determine whether a business' supply chain is ethical or not. Some examples of ethical and sustainable practices include, but not limited to:
- Fair-wage labor rules (no slave and child labor, paying employees appropriately, and suitable working hours)
- Adequate working conditions (safe and hygienic)
- Prioritizes waste treatment or management (reduce environmental impacts, or aims to recycle waste materials)
- Ethically sourced materials (raw materials are not mined illegally or in an environmentally harmful manner)
- Anti-bribery and corruption
Nowadays, many businesses will create videos, show images, or create landing pages to inform consumers about their supply chain practices. Before you make your purchases, consider the ideas mentioned above and whether the brand stands for these practices. By supporting ethical businesses, we will be able to drive the economy towards creating more enterprises for purpose, rather than enterprises for profit!
Remember, your dollar is your voice! Businesses, trading partners, or consumers must hold each other accountable to ensure that products are manufactured then consumed ethically and sustainably. We must look at philanthropic initiatives or supply chain practices individually but consider all of these elements in harmony to determine whether a business is worthy of our vote!