Labels with information about fair labour standards increased sales of a more expensive women’s item by 14%, showing that even in price-sensitive outlet stores, there’s a segment of shoppers willing to support ethical standards.
In 2015, researchers from MIT and Harvard explored whether consumers are genuinely willing to put their money where their values are. By partnering with Gap Inc., the study conducted a large-scale experiment across 111 Banana Republic stores to see if information about fair labour standards would influence purchasing behaviour. The findings? Ethical business practices can indeed impact the bottom line. (You can access the full research paper here).
Key Takeaway from the Research
The study revealed that when consumers—particularly women shopping for higher-priced items—were presented with products labelled as being produced under fair labour standards, sales of these items increased by 14%. This indicates that a significant segment of consumers is willing to pay more to support businesses that prioritise ethical practices.
However, the impact wasn’t as pronounced for lower-priced items, suggesting that price sensitivity plays a role in consumer decisions. This means that while there’s a large market for ethically produced goods, targeting messaging effectively is crucial.
Commentary: What This Means for SlaveCheck’s Business Compliance Platform
These findings reinforce the value of embracing and communicating ethical business practices for high-risk reporting entities—such as multinational companies in tech, apparel, and manufacturing. Compliance and ethical initiatives should not just be about meeting regulatory requirements but viewed as a strategic advantage. With the increasing demand for transparent supply chains, customers show they value businesses prioritising ethical standards.
SlaveCheck’s Business Compliance Platform helps companies mitigate risks and ensure compliance with global legislation and positions them to leverage their commitment to ethical practices as a competitive differentiator. Just as the study showed increased revenue with the right ethical messaging, companies using SlaveCheck can tap into this growing segment of consumers willing to invest in ethically produced goods.
Why This Matters
With an estimated 49 million people trapped in modern slavery, two-thirds of whom are in global supply chains, regulatory and consumer pressures are intensifying. Companies face growing expectations to prove their ethical standards and transparency. The ability to monitor and communicate these efforts effectively isn’t just about meeting compliance—it’s about driving revenue and building long-term brand value in a rapidly changing market.
Final Thoughts
The Socially Conscious Consumer study provides clear evidence that ethical business can drive revenue. The entire research paper is here for additional insights and detailed findings. At SlaveCheck, we’re here to help your organisation go beyond compliance and lead in ethical practices. Let’s talk if you’re interested in exploring how to position your brand as a leader in ethical business.
