Why consumers are dropping the ball in the game of socially responsible capitalism
Everyday we hear about another new business or reformed corporation joining the ethical marketplace in an attempt to fulfill our fantasies of a sustainable consumer lifestyle. Maybe these outfits are dedicated to the environment, or maybe they're just angling for a piece of the moral profit pie by hawking fair-trade products. Whatever the businesses' motives, there's trouble in socially responsible paradise: Despite surveys showing an eager customer base, people aren't putting their money where their mouths are and actually buying ethically produced goods. In a piece for the Stanford Social Innovation Review, four researchers -- Timothy M. Devinney, Patrice Auger, Giana Eckhardt, and Thomas Birtchnell --investigate why consumers aren't closing the corporate social responsibility (CSR) loop.
One surprising discovery they made was that information on ethical issues and the availability of socially responsible products did not make a difference in consumer choice. Consumers made explicitly aware of a product's benefits to society or the environment were just as likely to choose the cheaper, more harmful brand as a control group given no information about the products. But is it really as bad as an Australian participant in a similar study claims: Do '[m]orals stop at the pocketbook'?
The Stanford team found that people willing to pay more in the name of ethics do exist, but they're not who you think they might be. There is no group designated by nationality, age, gender, income, or education level that consistently buys ethical products more than any other. The authors write, '[c]ontrary to what some might believe, CnSR [consumer social responsibility] is not just the purview of wealthy, highly educated females in liberal Western democracies. Rather, it is something embedded in the psyche of individuals.'
With a change in marketing tactics, these researchers believe that ethical businesses could win over hard-to-reach shoppers. Social issues should be chosen carefully, as consumers need to see a direct link between buying a certain product and its effect on society. To wit: A 10 percent donation to an AIDS charity for buying a pair of pants is not as convincing as buying biodegradable dish soap. Consumers also need to know that the product they're buying is functional in comparison to conventional brands -- no one wants to waste money on a product that doesn't do its job. For the rational consumer, social responsibility is only icing on the capitalist cake, but if it's the right icing people may just be willing to pay for it. -- Suzanne Lindgren
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