Home Ideaspotting Business Ethics: 3 Modern Startups Built On Moral Principles

Business Ethics: 3 Modern Startups Built On Moral Principles


Over the past few years, a new trend has hit the marketplace – and it’s not about any particular product. Rather, as if emerging from a Portlandia sketch, people have begun to ask questions about the ethics of consumer goods. They want to know if the things they buy are locally made, if workers make a living wage, and whether materials are sustainably sourced. And though most large companies can succeed regardless of their business ethics, startups are responding with cruelty-free products, eco-friendly packaging, and charitable connections.

Millennials, in particular, are more likely to shop local and be loyal to brands with ethical business practices, and they’re more likely to research and be aware of the markers of such practices. But from the perspective of ownership, how can you get on board with this trend?

Take a cue from these 3 businesses, all of whom have invested in the ethical marketplace.

Cred: Inside The Diamond Lab.

Of the many industries millennials are “killing,” the engagement ring business, particularly diamond engagement rings, is one the most talked about – and one of the primary reasons for this useful defection is an ethical one. Many diamonds are mined under dangerous conditions, contribute to environmental damage, and the industry is a source of violence across the African continent. In an attempt to mitigate such damages and draw consumers back towards diamonds, more companies are growing diamonds in labs, sidestepping the ethical issues.

One company that’s making use of these lab grown diamonds is Cred Jewellry, a UK-based company that combines ethically mined gold to create what they’ve deemed the Ultimate Ethical Engagement Ring. In addition to avoiding the social harms associated with diamonds, lab-grown stones are also significantly less expensive than mined diamonds, yet are structurally identical. This can make a big difference to cash-strapped millennials, but ultimately the social pressure on the diamond industry is what matters most. Indeed, Cred Jewellry suggests their practices are going mainstream and that in the US, 50% of diamonds will be lab grown by 2020.

Milani: Moral Makeup Manufacturing.

When purchasing makeup, buyers want to know that it’s safe for their skin – but the testing for these products is historically controversial. In particular, decades of protests against animal testing have created a situation in which select makeup manufacturers actually vouch for the cruelty-free status of their product, making it clear that they don’t test on animals. Milani shows their cruelty-free status with the widely recognized rabbit logo, which is the beauty world’s equivalent to organic or fair trade labeling.

Because animal testing has been a hot button issue for so many years, there are actually a large number of brands that make cruelty-free and even vegan makeup, ranging from the budget brand e.l.f. Cosmetics to L’Oreal-owned NYX and small brands like Seraphine Botanicals. Compared to many other markets, the makeup industry had made it easy to find ethical products without excessive cost.

SmartGlamour: Transparency And Textile Production.

In direct contrast to the makeup industry, where demand for ethical goods have made them easily available, the world of clothing manufacturing is marked by frustration with fast fashion and sweatshop conditions without any subsequent efforts to do better. Even many people who speak out about garment production will turn around and purchase items made in the worst conditions. Fashion preferences come to outweigh personal ethics.

At SmartGlamour, a Queens, NY-based company, though, ethics come first. Their site highlights their production practices and outlines the SmartGlamour pricing system. This kind of transparency is important for buyers because one of the primary reasons people purchase mass-produced fast fashion is the cost. Though factory workers could easily be paid much more with minimal impact on our costs, few companies are willing to make that change.

Framing The Future.

Across the board, one of the most obvious markers of ethical business practices is the willingness to be forthright about what a company does, and startups concerned about promoting such practices should emphasize transparency. That might mean listing materials and sourcing information, identifying the place of production, or even showing video of manufacturing locations. Depending on your industry, you may also be able to receive specific certifications, such as cruelty-free or fair trade. All of this information works together to guide customers who care about ethical purchasing.

Though it seems like basic logic to treat workers well and be open about business practices with customers, most major corporations sidestep these practices precisely because they would reflect poorly on them. This generation of startups, however, is working to change the tide. The fact is that transparency and ethical business practices can be profitable – and businesses like Cred, Milani, and SmartGlamour demonstrate that every day.