A few weeks ago, while Amazon was running its Prime Day event, a few readers contacted me and asked me not to talk about the event in any detail because of ethical concerns they had about Amazon and their business practices. I wasn’t planning on covering the sale with much depth anyway, so it wasn’t an issue, but it did leave me thinking about the issue of balancing ethical shopping with good personal finance practices, an issue that’s been dangling in my mind for years.
I attempted to make a list of ideas, principles, and strategies regarding this difficult topic and, after a while, I realized that the core ideas I have to share actually just make up a fairly small list, so let’s just dig right in, shall we?
Everyone has different ethics and values, so it’s very difficult to make broad recommendations about ethical shopping. The reality is that different people care about different things and value different things more highly than others. We all largely agree on the set of things that are right and wrong, but which thing is more right? Which thing is more wrong? We can argue about that forever, especially when we’ve come to a consensus on some of the true black and white issues.
Take the Amazon issue that spurred this article, for example. Some readers were bothered by issues with Amazon’s warehouses and employee treatment. Others were bothered by the waste generated by shipping.
Those are both valid concerns, but they’re not necessarily high priority concerns for everyone. If I were to offer a blanket statement of “don’t shop at Amazon for these ethical reasons,” that turns the issue from good practical personal finance advice into promotion of my own ethical views. I am far more interested in giving people practical tools so they can make their own judgments than imposing my judgments on others.
So, what are those practical tools?
Know who you’re buying from. If you’re giving your money to a particular business, either a retailer or a manufacturer, it’s worth your time to spend a few moments learning about who you’re buying from in terms of the issues you care about.
If you do a bit of investigation into any sufficiently large company, you’ll likely find some issues that concern you. The question is whether or not those issues concern you enough to not be a customer of that business or that manufacturer, and that’s up to you and your personal ethics.
There are a handful of companies out there that I never want to shop from or own products made by them for specific ethical reasons, but my reasons for doing so are in line with my own values and the things I care about. I also have a second tier of companies I prefer not to do business with unless there’s not a reasonable option, and, again, my reasons are my own. I am not a perfect database or repository of information about companies, nor do my values likely perfectly match your own.
That being said, I understand that most companies out there do have some sort of ethical issue if you look close enough, whether it’s something related to how they treat employees or how they distribute products, and once a company grows to a reasonable size, it’s almost a guarantee that you’ll find complaints about their behavior. It’s very difficult to find a “perfect” company. You simply have to decide for yourself what level of corporate behavior you’re okay with, and that varies a lot from person to person.
Research the company and make up your own mind. Don’t expect perfection, but it’s perfectly reasonable to have some companies that you don’t wish to give money to, and understand that other people may have other distinctions and other issues they prioritize. Also, recognize that one giant corporation with some bad spots on their reputation may not be any worse than another giant corporation with a more clean reputation; they may just have worse public relations and marketing.
I actually prefer a different approach.
Rather than focusing your energy on taking your spending away from an unethical business, focus your energy on taking spending to an ethical business. I am far more interested in companies that do things well than I am in companies that do things poorly. I would prefer to take my business to a company that treats employees well than take my business away from a company that doesn’t. I am less interested in boycotting than in simply choosing to spend my money at a great business.
For example, I like to see companies that make reliable products. I like to see companies that treat their employees well. I like to see companies that take solid steps toward environmental responsibility. I like to see companies that expect some of these standards from companies in their supply chain.
To me, this is a positive approach to ethical spending. If you have $X to spend and you take that $X to a business with practices you’re happy with and use it to buy products from a manufacturer you’re happy with, then that’s a much better approach than taking money away from a company you’re unhappy with and merely spending it with a similar company that may be doing the same things but you don’t know about them.
In other words, I don’t usually try to go out of my way to avoid companies with mediocre or even somewhat negative reputations. Instead, I try to take my business to businesses with positive reputations if they’re available to me.
But what about the cost? Often, buying from a more ethical company with good employee and business practices and good products means that the sticker price is going to be higher. How does one solve that issue?
My approach is simple. A personal commitment to spending less overall and being careful about your purchases means that you have more breathing room to be ethical about your purchase. Part of the reason that people tend to balk at paying anything higher than the lowest possible price for something is that they want to simply buy more and more things. If you pay $80 for something at one retailer versus $100 at another retailer, that’s $20 in your pocket. If two retailers charged the same amount, then, sure, the person is likely to go to the more “ethical” retailer, but if one retailer offers lower prices, that means they can fill up their cart with more stuff or have more cash left over for other things.
But what if your approach to spending wasn’t to fill your cart up with more stuff? What if you ideally didn’t want to buy new things at all unless they filled a genuine need in your life? What if you consistently used a strong mental toolbox for avoiding unnecessary purchases? That would leave you with a much greater ability to be ethical in your shopping behavior.
In the end, I am going to suggest one single concept that I think is a very strong idea in terms of ethical buying for almost everyone.
When in doubt, buy from the more local source so that money stays in your community and thus supports other local services. Buy from the business that’s owned by a local person that employs lots of local people. Buy from the smaller chain that’s only got a handful of locations, all in your state, instead of shopping at MegaloMart.
That kind of choice might cost you a little more, but it means that a much larger portion of your spending dollar stays in your community and state. The taxes paid by those employees and business owners are going to go toward things that help you, and it’s going to make sure that people stay employed in your town.
Not sure what’s truly local? This circles back to doing the research into who you’re buying from and what you’re buying. Find out about those businesses. Who runs them? Do they operate ethically? Understand that no business is perfect, but look mostly toward businesses that try to operate in a good manner rather than away from businesses that you find negative reports about.