Ethical consumption: staring at the sun

Sonnie Bailey

1 April 2022

A lot of people are interested in ethical investing.

I’ve written about ethical investing in depth before. In short: I’m ambivalent about the idea. I like that the concept exists, and I like the type of people who find it attractive. But I’m not sure it makes a big difference. If your concern is influencing how companies operate, I don’t think it has a material influence on their behaviour.

I also think many investment managers talk about it for marketing purposes rather than because it’s something they believe in.

At the individual level, I think there’s a risk that ethical investing is a form of “conscience laundering”, It makes us feel like we’re doing our bit. When we could – or should – be doing a lot more in other domains.

Collectively, we are likely to have a bigger impact if:

  • we support effective regulation, and encourage these regulations to be effectively enforced.
  • we factor ethical decisions into our consumption (and purchasing) decisions – in thoughtful ways.

An investing exception: I don’t invest in crypto for ethical reasons

When it comes to investing, I invest in index-based funds that operate on an “exclusions” basis. Ie, they invest based on an index, but exclude companies from more problematic industries. That’s good enough for me.

One exception to my personal ambivalence towards ethical investing is that I don’t invest in cryptocurrency*. There are several reasons for this. But the main reason is ethical.

This is especially the case for cryptocurrencies that use proof-of-work mechanisms such as Bitcoin and Ethereum (currently).

By investing in these cryptocurrencies, I believe I’d be unnecessarily contributing to climate change and its inequitable outcomes. It doesn’t sit right with me.

* Truth be told: I invested $20 in Ethereum on Coinbase quite a while ago. As I type this, it’s worth a whopping $14.38. 

Ethical consumerism: first, the counterarguments

There are quite a few counterarguments against the idea of ethical consumerism. A couple of NZ-based perspectives:

I agree with most of their points. There are aspects of “spending in line with my values and priorities” that are probably ineffectual, but make me feel good:

  • I won’t buy anything that I know will benefit Donald Trump or one of his enablers unless I have to.
  • We’ve installed solar panels, partially for the return-on-investment but partially because of the feel-good factor. We are thinking of installing a house battery even though the financial ROI is unlikely to be very good, and a big reason would be the feel-good factor.

Rich’s and David’s comments are probably applicable to what I’ve listed above.

However, when I think of consumption decisions, I suspect that my focus is on different things to what they are arguing about. I think the important consumption decisions are:

  • Whether to consume at all. As Rich says: “the only guaranteed way to actually be an ethical consumer [is to] buy less stuff”. On this point, I’m in ferocious agreement. At the very least, I do my best to buy less consumer crap – items that provide very little value and will end up in the bin sooner than later.
  • Making big, genuinely impactful decisions. David’s article refers to Will MacAskill’s book Doing Good Better, mentioning: that “MacAskill argues that popular ways to reduce personal greenhouse gas emissions are rather ineffective – eg turning off electrical devices when not in use, turning off lights, not using plastic bags & buying locally produced food all achieve little compared to other changes such as taking less hot baths or cutting out red meat and dairy for one day a week.” Which leads me to think – why not make those more effective changes, like taking less hot baths or cutting out red meat and dairy?

The big lesson for me isn’t that ethical consumerism is a dead end. It’s that it isn’t necessarily easy. Many of the things we can do that seem “good” at a superficial level aren’t very effective. But that doesn’t mean the exercise is futile.

Staring at the sun

One of the ways I describe the NZ Wealth & Risk blog is that it’s about “money, managing risk, decision-making, and living a life that’s in line with your values and priorities”.

Living in line with your values and priorities means living with integrity to what you care about, and what you think is “right”.

Lately, I’ve been “staring at the sun”. By this, I mean that I’m reflecting on topics that are uncomfortable and inconvenient. These are the sorts of things that I generally try to avoid. I don’t think I’m alone.

This includes making my own personal, normative judgements about what is “right” or “wrong” – for me, in light of my own circumstances and weighting of lots of factors.

If you’re the sort of person that cares enough to think about ethical investing, I encourage you to “stare at the sun” and think about the ethics of:

  • How much you consume. This includes owning homes that are much larger than necessary for your household, or cars that are more powerful than you need.
  • To what extent you travel, especially via plane.
  • Whether, and to what extent, you consume meat and animal products.

There are lots of factors involved with each of these items. You can weigh different factors more or less heavily than others. You can legitimately come to different conclusions to other people. For example, when it comes to meat you might consider the quality of life of the animals in question, and you might give more or less weight to methane production and its consequences.


  • I try to consume less, but it’s something I’m working on.
  • I don’t travel as much as many other people in my position (Covid notwithstanding). I actively try to avoid travelling for work-related matters (for climate reasons, and also so I can spend more time with my family). (Even locally, my default preference is for a Zoom meeting rather than an in-person meeting.) In part this is informed by the fact I don’t have the “travel bug” to the extent that many other people do. Having said that, I do travel, and admittedly I probably travel more than many people.
  • If I were to describe myself generously, I’m a vegetarian, moving slowly towards veganism (especially in relation to eggs). More accurately, I’m a reducetarian and have done a good job of reducing my consumption of meat and animal products somewhere in the range of 90-99% in the past year.

In the words of Will Smith, I’m a work in progress. I’m not perfect. There are areas where I vacillate and will continue to update my views, which will inform my consumption decisions.

If you have the money, and you’re in the position to vote with your dollars, I think it’s entirely legitimate, and decent, to make consumption decisions – including decisions not to consume so much – that align with your values and priorities.

It’s not always easy. I’ll openly admit that there are a lot of cases where the thing that seems like the “right” thing to do on a superficial level isn’t as effective as we intuitively think. But it’s a worthwhile exercise, even if it’s hard or inconvenient.

In my view, it’s likely to have a bigger positive impact than whether you use an ethical investment manager, or the specific manager you use.

The next step? Effective regulation (and effective implementation of that regulation). I have lots of bugbears but two of them relate to misleading and deceptive conduct, and people and organisations not being responsible for negative externalities. But these matters are entirely separate conversations!!!

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