How ethical shopping is making business go green

Companies are exploring the use of biodegradable plastics because it makes business sense for several reasons - all of them linked to the environment.

First, shoppers are becomingly increasingly frustrated by the voluminous packaging that fills their bins when they unwrap food. That irritation has been picked up in research. Consumers shouldering the hassle and moral unease about generating this vast, obvious waste could choose to patronise street markets that are cheaper and less wasteful. Consumers aren't just annoyed because packaging is awkward, many are worried about the environment. And big companies are only too aware that, with climate change rapidly rising up the political and public agenda, green issues cannot be ignored.

Second, retailers and suppliers are keen to attract a new breed of ethical shopper. The research organisation The Future Laboratory (TFL) has documented the rise of what it terms the "conscience consumer". Typically, TFL found these ethical shoppers are cash-rich, credit-using 30-something city-dwellers who are keen - in the words of one such individual - to use "credit cards as ballot cards".

In its survey, 26 per cent of people aged 34-44 said they increasingly used their purchasing power to reward ethical, social and environmentally-aware companies. Ethical shopping is now valued at £25bn a year.

The Red movement, championed by Bono, is a good example of the targetting of this market. Amex's Red credit card carries the words: "This card is designed to eliminate Aids in Africa" - a social mission, playing to the conscience of the consumer.

The annual report on ethical consumption by the Co-op Bank has detected a rise in spending on products linked with easing climate change, such as wind and solar power, energy efficient fridges and the like. More members of the public, the report found, are trying to shop locally and to use public transport.

The third factor - and perhaps the most decisive in the long run - is the looming oil shortage. Although technology has existed to make biodegradable bottles and tubs for a while, companies have lacked a commercial motive to warrant its introduction.

The rising price of oil is transforming that calculation. The cost of oil has risen 1,000 per cent (10 fold) in the past eight years - from $6.90 to $69 a barrel. Experts believe this may soon level the cost of biodegradable and conventional packaging.

So with "peak oil" - the point when global oil production starts to decline - only a few years away, it is sensible for companies to plan for the future. Making wrappers and tubs out of starch from corn, potatoes, beetroot or sugar cane may not just be greener, but cheaper too. And if you can make a virtue out of that necessity by attracting conscience consumers irritated by wasteful packaging, then you may have a pleasing solution to an ugly problem.