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Interviews: Growing a Green Economy

Maquilapolis: City of Factories makes the case that the well-being of factory workers in Tijuana is directly linked to a consumer's individual spending habits. Two experts in social investing explain how one educated shopper's dollar can wield clout and influence corporate practices.

POV: Many of us are accustomed to shopping and making other consumer choices based only on price and quality. Why should we factor in ethical considerations when making consumer decisions?

Dan PorterDan Porter: Each of our decisions, whether we know it or not, is promoting certain activities and advancing certain values. The question is, what activities and values are you supporting with your purchase? If you buy paper products created by clear cutting old-growth forests you are supporting that activity and a certain set of values. If you buy paper products made from recycled materials, you are supporting that activity and a different set of values.

The marketplace pays a great deal of attention to consumer behavior. Companies spend huge amounts of money on market research and even more on building their brands. Studies by Interbrand and others indicate that a company's brands often make up a substantial portion of the overall value of the company. This is particularly true with companies that cater to consumers. So companies pay a lot of attention when their products or brands slump or take off.

Ethical or conscious consuming is a logical extension of taking price and quality into consideration. "Quality" already includes certain characteristics (safety, reliability) that are connected to ethical and sustainable practices. Ethical companies do not knowingly make unsafe products. And when they realize a product is unsafe, they do something about it. What we normally think of as the "price" of a product is how much we have to pay for it. If you look at a broader context than just that transaction, however, the true cost of a product or a company's practices in producing products is often much more than what we are paying. Who is picking up the tab for those costs? Ultimately, we are, through degraded environmental conditions, climate-change impacts and higher health-care costs.

Being more conscious and ethical about your economic decisions will also add a level of satisfaction that you can't otherwise get from buying a product. It's the satisfaction of knowing that you are acting in closer alignment with your values. You may not always have a clear-cut choice, but if you make the choice consciously, both you and the world are more likely to benefit.

POV: Some people may be more accustomed to seeing consumer activism through boycotts — is encouraging consumers to make informed, ethical choices as effective? Does ethical consuming accomplish different things?

Porter: Boycotts are actually a concentrated form of ethical, conscious consuming. A group of consumers, often prompted by nonprofit or watch-dog organizations, makes a conscious decision not to buy a certain brand or from a certain retailer. They can be a very effective way to address specific issues with specific companies and, sometimes indirectly, with industries. Because a boycott is focused, usually on a particular company, it often produces a faster and more focused result.

An aerial view of several maquiladora manufacturing and assembly plants located just south of the US-Mexico border.

Broader applications of ethical or conscious consuming have a less immediate impact. The impact is often derived more from the carrot than the stick, but it can be more profound. What you are really doing with conscious consumption is providing feedback to the market. Usually, when the market gets a sufficient amount of feedback, it responds. If enough people make certain choices, companies begin to see a trend and then seek to capitalize on that trend. In trying to capitalize on the opportunity, the company often changes its production and marketing practices. If the trend reveals a greater demand for more ethical and sustainable products and business practices, the company ends up not only changing its products and practices — it ends up promoting sustainability.

POV: Can you share some examples of consumer influence helping to improve corporate behavior — labor practices or environmental policies or corporate policies?

Porter: One of the best examples of consumer influence is organics. As more and more people have made conscious choices about purchasing organic foods, the organic industry has grown. Today millions of acres are farmed without pesticides — which is a huge boon to the environment and arguably to the health of consumers. The transition from a small movement to a market phenomenon hasn't been perfect. Some say organic has lost its soul, but the implications of major corporations seeking to address the organic market extend beyond the immediate benefits to the environment and consumers. As companies seek to enter the market or expand their market share, they promote and advertise their products, which further extends the public's awareness of the importance of the food they eat and the manner in which it was produced. This will, in turn, start to make some people think differently about what goes into their cleaning products, furnishings, and clothes. And all this started with a relatively small group of producers and consumers making conscious choices about what to grow and eat.

Another good example is the significant movement by a number of cosmetic companies away from testing their products on animals. In this case, high-profile boycotts helped raise consumer awareness about the issue. At the same time, the explosive growth of companies like The Body Shop proved that there was substantial consumer demand for animal-test-free products.

POV: How does the idea of ethical consuming or investing fit into day-to-day life? Is it a never-ending commitment, a single factor when making choices, or something else?

Porter: Ethical consuming or investing is not an all-or-nothing proposition. It is trying to be conscious about your economic decisions as often as you can. Nobody, except maybe the Dalai Lama, does consciousness perfectly. This is one of those situations where perfection is the enemy of progress. So don't worry about getting it right —just start thinking about what is really important to you and paying attention when you shop. If you care about a specific issue, start with that. Each of our purchases provides feedback to producers and the marketplace. Sometimes you can see an impact with a small local business. On a grander scale, the impact of a person's choices may seem invisible, but when large numbers of people begin to make similar choices, the market will respond.

Ethical consuming is ultimately about being conscious about your purchases and whether they align with your values and give you what you really want. Are they good for you? Are they supporting the kind of world you want to live in or leave to your children? Very few people behave "consciously" all the time —it's really hard to do, given the pace of modern life. But when you do something consciously, it almost always changes your experience of the activity for the better. This applies whether you are in a business meeting, driving a car, enjoying another person's company or shopping.

There is a subtle yet powerful satisfaction in taking actions that align with your values.

POV: Where does one draw the line when pursuing an ethical consumer choice? Are there always tradeoffs or compromises involved? How do we balance our values within a budget?

Porter: There are probably always going to be tradeoffs. Obviously, the more affluent you are the easier it is. But just because you have to operate within a budget doesn't mean you can't consciously make decisions about what you buy. You may have to make more compromises, but some of your decisions will adhere more closely to your values, which will be a contribution and source of satisfaction. The important thing is to avoid the perfectionist trap — "If I can't do this perfectly, 100% of the time, why bother?" That kind of thinking is always the enemy of progress. If we applied that attitude to learning to walk, we would all still be crawling around on our hands and knees.

POV: The film "Maquilapolis" focuses on women in Tijuana who work in a factory that makes televisions, and it seems that electronics are a particularly troubling industry when it comes to making ethical consumer choices. Is there a way for consumers to have an impact in a situation where every choice is a difficult one, and there may not be an ideal ethical option?

Porter: A lot of consumption decisions fall into this category. It is important to recognize that while there often aren't ideal ethical options, there are always choices to be made. The point is to make the best choice you can under a given set of circumstances. If all your choices are flawed and you are determined to buy a given type of product, then try and choose the product with the most sustainable design or the one made by a company whose overall practices are most congruent with your values.

Electronics is a good example. You can look at product design. Is the product Energy Star certified? Is the product design one that uses less material and/or less energy? Flat-screen computer monitors are a good example of this — they use fewer materials and less energy. You can also look at the policies and practices of the companies manufacturing the product. Is the company transparent about its practices, policies and manufacturing locations? Are they taking steps to reduce their pollution and create more sustainable products? Are their labor practices sub-standard?

With electronics and other industries where most of the action is happening outside the U.S., I think we need to consider the impact of our trade policies. Both the environment and workers suffer when free trade is not fair trade. So it's important to let those who can influence these policies, our political representatives, know that environmental and labor standards have to go hand in hand with free trade.

POV: Besides making informed choices, how can consumers be active to encourage more responsible corporate behavior that is in line with their values?

Porter: It is important to realize that your actions as a consumer are only part of the picture. There are a number of other things an individual can do to align their actions with their values and contribute to positive change.

  1. Support local communities and businesses. You can have a more pronounced impact locally, whether your focus is political, policy or economic. Increasingly towns and even states are seeking to regain some of the influence they once had over corporations, and this, by and large, is a good thing. Economically, a much higher percentage of the money you spend goes back into your local economy and local businesses are much more sensitive to the purchase decisions and opinions of local customers. You can often magnify the impact of your purchasing decisions by buying locally.
  2. Exert influence on the institutions you are involved with. We all work for, go to school at, receive services from or are members of organizations. By making your opinions known and engaging these institutions on certain issues, you can help stimulate these organizations to implement policies that can have a positive impact.
  3. Align your investments and your proxy votes with your values. The majority of Americans are now investors. Investors can choose not to invest in a company or to divest from a company they currently hold shares in. This activity is becoming more commonplace among both individual and institutional investors, as information about corporate practices becomes more readily available. Investors can also exert influence through their proxy votes. A growing number of proxy resolutions related to environmental and social issues are coming up at corporate annual meetings and some of these are gaining enough support to influence companies to change their practices.
  4. Promote campaign and lobbying reform. One of the most important tools in moving corporations toward more responsible behavior is regulation and legislation. Companies are naturally resistant to having their flexibility limited and, in our current system, can exercise enormous and undue influence on legislative and regulatory processes. We need to reduce that level of influence so government can more effectively serve the people. Supporting efforts at finance reform and pressing your representatives to act on these issues can have an impact. There is a growing momentum for reform and we all need to feed that fire.

People shouldn't get discouraged because they don't see changes happening overnight. You have to take a long view. When you step back and compare things twenty or thirty years ago with today, you can see that progress has been made. There are a lot more "sustainable" products on the market today than twenty years ago. Look at the organic industry. Look at recycling and the number of products produced from recycled materials. Look at hybrid and alternative cars. Look at the growing number of companies in the alternative energy industry, which is now in the top five as far as venture capital seeking to invest in that industry. The trends are positive, in part, because consumers are voting with their wallets and their actions, and companies, even industries are listening and responding.

« Alisa Gravitz





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