What Is Ethical Branding & How to Create an Ethical Brand (2024)

Have you heard the term ethical branding and wondered how ethics fit into a brand identity?

In this guide, you’ll find everything you need to fit ethical branding in your brand identity.

Having a brand identity is one of the best ways to promote and establish a business. It helps your target audience remember your brand and choose it over your competitors.

But, what about your brand ethics? How do ethics come into the picture? Let's find out.

Table of Contents

• What Is an Ethical Brand?
• Why Is Ethical Branding So Important?
• How to Create an Ethical Brand
• 9 Examples of Great Ethical Branding

What Is an Ethical Brand?

In simple words, an ethical brand leaves behind a legacy of values, strategies and actions that can be perceived as morally right and ethical.

An ethical brand doesn’t harm people, animals or the environment, and it contributes to the society responsibly, positively, and in a sustainable way.

Statistics say that about 13% of customers are willing to pay up to 50% more to companies they see as positively contributing to nature and society.

Additionally, GlobeNewswire claims that ethical practices are the second-highest reason for consumers returning to a brand after product quality.

As a marketer, these statistics are critical for you and showcase why you should adopt this branding practice to make your brand survive in such a competitive era. However, many other aspects make ethical branding a critical branding practice.

Why Is Ethical Branding So Important?

Undoubtedly, every brand should engage in ethical practices because it's the right thing to do. However, you might be wondering whether it should be one of your core branding strategies or not.

So, before we jump right into discussing how to create an ethical brand, let's understand why it’s important.

Here are the reasons why ethical branding is essential.

Demonstrate a Cause to Support

A recent survey by Accenture found that about 62% percent of buyers want companies to take a stand on social issues like sustainability, transparency and fair employment practices.

Ethical branding helps you demonstrate that your core brand values are making a positive difference in the world.

Since your brand survives off of society, it's your duty to give back to society. You can do that in various ways, such as donating money to charitable trusts, raising awareness for climate change, fighting against global warming and many others.

Stand Out From The Crowd

One of the primary objectives of branding is to make your brand stand out from the crowd and help your customers differentiate your brand from your competitors. You may have already experimented with the other branding practices, such as choosing unique brand colors or brand fonts.

But, ethical practices can give your branding efforts another level of boost. Ethical branding helps your brand stand out easily, assuming it fits properly and gets plenty of visibility.

Find Your Niche

Understanding your niche is an essential step in marketing and branding. It helps you identify your target audience's needs and come up with new products and services.

Moreover, it increases engagement by communicating with your target audience in the right way and helps you stay ahead of the competition.

But how does ethical branding help you find your niche? Suppose you want to support a cause such as child education. This can help you come up with some products like notebooks and pencils and donate part of their cost towards the cause.

Therefore, you’ll strongly appeal to the niche associated with that cause. Even if you need to charge more for your products and services, you can easily beat your competition with this angle.

Recruitment Benefits

According to a 2017 CSR Study by Cone, 94% of Americans felt that being a good employer is one of the top priorities of ethical branding practice. So, you can see that employees care about the compensation and the brand ethics as well.

If your brand focuses on solid ethical practices, it will help in making the recruiting process smoother. More candidates will be interested in applying to work with your company and they’re more likely to become loyal employees.

How to Create an Ethical Brand

Whether setting up a new brand strategy or creating a brand from scratch, the following ideas will help you create an ethical brand.

Understand Your Ethical Brand Purpose

Brand purpose is the reason for your brand to exist — beyond making a profit. It helps you show your customers that you’re more than just your products, services or marketing campaigns. Beyond that, your brand contributes to a greater cause in the world.

So, you need to understand your brand's purpose first. You can do this by asking yourself why your brand exists. According to Simon Sinek's Golden Circle concept, people don't buy what you do; they buy why you do.

However, you might end up finding brand purposes of other businesses stronger than yours. Hence, to find a solid ethical brand purpose, you can look at the major sustainable development goals called the "UN Global Compact" set by the United Nations.

Know Your Ethical Brand Values and Principles

Once you’ve found your brand purpose, it's time to define your ethical brand values and principles. These are the beliefs that you stand for as a company.

According to the Principles of the UN Global Impact, your ethical brand values should focus on meeting fundamental responsibilities in the areas of human rights, environment, labor and anti-corruption.

These values and principles shape your brand personality, brand voice, brand guidelines and affect many other aspects of your branding efforts.

Offer Sustainable Products and Services

You might have the best brand purpose and values in the world, but if that doesn't reflect in your products and services, your brand will never be considered ethical.

Thus, one of the most important aspects to consider when creating an ethical brand is to provide sustainable products and services. Even if your products do not contribute to society, try to make your offerings as harmless as possible.

One of the best ways to make your offerings more eco-friendly is to practice green procurement. This involves using ingredients that are produced and supplied in a sustainable manner.

Here are some other steps you can take:

• Offer remote jobs
• Provide public transportation benefits
• Practice composition
• Adapt sustainable packaging
• Make energy efficient upgrades
• Use green web hosting services
• Do business with eco-friendly brands
• Buy carbon offsets

Keep Your Production Line Safe

If you have a production line, make sure that you operate safely. The primary objective of having a safe production line is to ensure the safety of the people working for your company.

Additionally, a sustainable production line will lower operating costs, improve green manufacturing and create a good production environment. You can employ a production line evaluation to make sustainable decisions.

First, analyze the possible uncertainties in the engine production line and deficiencies in the existing methods. Then, introduce recyclable materials and reduce packaging. Finally, make sure that you use clean energy and strive for minimal waste.

Adapt Ethical Supply Chain and Distribution

Supply chain management is another critical aspect of ethical branding practices. You need to integrate environmentally financially viable practices into your supply chain lifecycle.

Here are some best practices to follow:

• Follow fair trade policies to support local producers
• Choose suppliers that follow ethical production procedures
• Minimize transport to reduce environmental pollution
• Optimize the use of materials to minimize waste
• Join industry collaboration
• Integrate supply chain sustainability criteria into the procurement process

Treat Your Employees Fairly

Incorporating ethical practices in human resource management is another aspect to consider for ethical branding. Your company's growth relies heavily on the performance of your hard-working employees.

Therefore, you need to make sure they feel valued, respected and safe. Here are some tips for doing that:

• Encourage gender equity
• Offer reasonable compensation
• Provide a good work environment
• Support zero tolerance for corruption, disrespect, dishonesty and harassment.
• Focus on the professional growth of employees

Support Charity

A recent study shows that nearly 47% of consumers say they’re more likely to be loyal to a company that supports charity. So, supporting charity boosts your brand reputation, enhances customer loyalty, motivates your employees and ultimately shapes your brand equity.

Therefore, supporting charity is another critical component of an ethical brand. You can offer job opportunities in an underdeveloped area, support an NGO, sponsor local events and more.

9 Examples of Great Ethical Branding

To help you understand the value of ethical branding better, here are nine examples of great ethical branding. Each is one of the leading brands of their kind.

Example #1: TOMS

When talking about ethical branding, the first brand that comes into mind is TOMS. It’s a shoemaking company widely popular for its "One for One” ethical practice, in which one needed item is given away for each item purchased.

Since its inception in 2006 by Blake Mycoskie, the brand has distributed more than 100 million pairs of shoes. Furthermore, they claim to commit one-third of their profits to support people building equity at the grassroots level.

Example #2: Dr. Bronner

Dr. Bronner is the top-selling organic liquid soap brand in the United States. Founded by Emmanual Bronner, the brand's ethical concept prevails in its "Cosmic Principles." They include all the major standards of ethical branding.

The brand has introduced Cosmic Principles to support various causes such as drug policy reform, sustainability, income equality, regenerative organic agriculture and animal advocacy.

Example #3: Patagonia

Patagonia is a US-based clothing brand that focuses on outdoor clothing and is widely considered an "Activist Company." The company has implemented many ethical branding concepts in its core brand values.

Some of them include sustainable supply chain management, supporting grassroots activists, promoting minimalism, supporting regenerative agriculture practices, advocating systemic change and others.

Example #4: Divine Chocolate

Launched in the late '90s, Divine Chocolate is the first fair trade chocolate brand for mass consumption in the US. This is a farmer-owned company that focuses on paving the way for other leading businesses in the chocolate industry.

They support gender equality through women empowerment campaigns, empower smallholder farming families and livelihood of local communities and encourage 100% fair trade by using fair trade practices for everything they do.

Example #5: Ecosia

Ecosia is a search engine based in Berlin that donates 80% of its profits to NGOs that focus on reforestation. The brand considers itself a social business and planted over 137 million trees until now and still counting.

Furthermore, they claim that by searching with Ecosia, users not only contribute towards reforestation but also empower the communities around them to build a better future for themselves.

Ecosia is powered by 200% renewable energy, puts its users' privacy first and is transparent about everything they do.

Example #6: Bulk Market

Avoiding plastic waste is one of the biggest challenges our generation faces. Bulk Market was born with this as its primary mission. They say businesses should make it easy for people to make the right choices, and ditching disposable packaging is one of them.

Hence, they offer products in bulk and let customers take home only the products they buy. They aim to make the world plastic-free.

Example #7: Fairphone

Fairphone is a Netherlands-based smartphone brand that aims to develop devices designed and manufactured with minimal environmental impact. They primarily focus on having an ethical supply chain and production procedures.

Additionally, they strive to be 100% transparent with the public. From their production process to price structure, they share all the relevant information on their website.

Example #8: Starbucks

Starbucks is one of the most popular coffee shops globally that is committed to 100% sustainably sourced coffee. They use a method called C.A.F.E (Coffee and Farmer Equity Practice) to optimize their sourcing.

They always ensure each step of the coffee-making process is done ethically. The criteria set by Starbucks for ethical sourcing have now become the industry norm.

Starbucks works with over 170,000 farmers and generates billions of dollars in revenue each year.

Example #9: Apple

Though Apple has been criticized for its unethical practices, it’s now going green with a goal of becoming 100% carbon neutral by 2030. Apple took six major sustainability initiatives to achieve the goal:

• Reducing the use of carbon materials
• Using renewable energy in all of its stores, offices and data centers
• Using low carbon aluminum to produce components of their MacBooks
• Launched the China Clean Energy Fund and invested $300 million towards the cause
• Reduced the use of conflict minerals such as tin, tungsten and tantalum

Stand Out by Creating An Ethical Brand

Though it might not be possible to create a brand that is always 100% ethical, you should try to follow as many ideas as possible mentioned above.

Hopefully, the tips and examples inspired you to create an ethical brand or incorporate ethical branding practices in your core branding strategy.

However, your ethical branding should reach your target audience; otherwise, all your branding efforts will go in vain. And the eye-catching design is one of the critical factors to consider when marketing your products and services.

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