hat constitutes an ethical business, and is it important for businessmen and women to behave in an ethical manner? I ask the question, because there is evidence from all manner of industries that not all business-people pay this detail much interest.
The Oxford dictionary defines ethics as, “moral principles that govern a person's behaviour or the conducting of an activity.” In a business context, it usually refers to behaving in a way that limits any negative impact on other people or the environment. There are a number of successful entrepreneurs in our region who are keen to adhere to this principle.
Sandra Agar bought Surrey-based eco-birthday parties firm Little Cherry in November last year. Having been to a number of children’s parties over the years, she was flabbergasted by how much waste was created, with much going straight to landfill.
Conducting a little research, she realised there were very few companies offering eco-friendly alternatives, although the number of firms offering services such as organic food and washable nappies showed the market for environmentally sound parenting was there.
Regarding her approach to business, she said, “We teach our children that good manners will get you a long way in life, and business ethics is simply good manners. It is largely a matter of conscience. I would prefer to deal fairly with people so I can look at myself in the mirror each day.
“Also, one can look at the shocking PR some major retailers have received recently over issues such as how poorly their suppliers’ workers are paid. Furthermore, the world has changed and if you screw people over these days, they won’t come back for more. They’ll sell to somebody else instead, and a competitor will benefit from their expertise, products and special offers.”
Sandra has the experience to back up her theories. She was a buyer for major retailers for 20 years and believes she received preferential treatment from her suppliers because she dealt with them fairly.
Fellow entrepreneur Paula Beaumont also worked for major retailers before deciding to work for herself. Her Surrey clothing company Purity describes itself as a fair trade and organic boutique, so behaving ethically is clearly important to her.
She said, “I can’t see any other way to do business. You have to treat people fairly, that’s the basics of good behaviour. It’s only fair that those who make what you sell receive fair pay for what they’re producing.”
Elaborating, she described very cheap children’s clothes, like the “three-for-three-pound vests” as frightening. With such cheap clothing, little money filters down to those people who actually make the products.
“It is important to have a clear conscience that the people who manufacture our products get a living wage.”
With this in mind, Paula stressed the importance of being an ethical shopper too. “Consumers are led down the route of buying things because they are cheap, but they should make more considered purchases. They need to be educated that whilst it might make items a little more expensive, the quality of manufacture and material will stand the test of time.”
A sense of shared responsibility resonated with Natural Mat’s Mark Tremlett. He told me, “We believe it is the responsibility of the developed economies to demonstrate how business should be ethically conducted. The origins and welfare of the supply chain must be taken into account when goods and services are sourced, and when the finished product is re-distributed, it must adhere to the highest standards of product quality and integrity.”
He admitted to there being certain disadvantages in having an ethical business approach. “It is more challenging as you are not just conducting business on price. You must make sure your actions will not be detrimental to the environment, which takes more time and effort and will probably not be the cheapest approach.”
Sourcing ingredients organically has raised the production costs for Willow Beauty, which founder Sue Stowell thinks are maybe ten times higher than those of the big brands. She said she normally has to double what she thinks things will cost and that customers don’t always appreciate her other efforts, either.
“We wanted to use glass packaging as it is kinder to the environment,” she explained, “but many customers prefer plastic as it isn’t so breakable. When we started, six years ago, it was very difficult to find recyclable plastic bottles. Now it is a lot easier.
“There was also a sector of society who did not trust organic products to be as effective as those they were used to buying. It still exists to a degree, but is massively outweighed now by those who appreciate not having any horrid chemicals coming into contact with their skin.”
Initially, Willow Beauty was forced to operate with very low profit margins due to the act of trying to balance high production costs with a charging policy that did not deter new customers. When I asked Sue for some advice for any would-be ethical entrepreneurs amongst our readers she said, “Spend your money going on a lot of holidays instead!”
Thankfully, she was only joking and said she absolutely loves what she does. Despite all the hard work and money invested she has no regrets. Only a beautiful smelling office.
Sandra Agar also professed to loving her work. She said, “I get to meet so many more interesting people than in the corporate world. A big advantage is that we all have the same ecological / ethical approach, customers and suppliers alike, so there is always that common bond.”
Paula was just as enthusiastic. She said, “It is hard work, but running your own business is very satisfying and I wish I’d done it earlier. My advice is, if you’re serious about starting up your own business, do it. Don’t put it off for the future.”