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Retail framework

Retail framework

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Starting positive

Retail contributes to human happiness and dignity. It's the mechanism society uses to distribute the right products and services to the right people.

This is why any ethical retail assessment has a positive start.

This is then balanced against the negative aspects of retail such as excessive consumerism and negative products.

How we assess retailers

To be investable, retailers must demonstrate genuine commitment and credible action to manage negative impacts on people, animals and the environment.

Products made available
Products made available

Are the products negative or positive as defined by the Ethical Charter?

Sales, marketing & operations
Sales, marketing & operations

Do they promote irresponsible consumption of negative products?

Supply chain
Supply chain

Do they show genuine commitment and action, to manage negative impact on people, planet and animals?

Selling things we don't like

Many retailers will sell things we may not like, from tobacco and alcohol to meat and products with excessive amounts of sugar. How do we think about this as part of our ethical assessments?

We start from the premise that to an extent, retailers provide a marketplace where producers can get their products to consumers and consumers can find the products they want. That is, they are product agnostic. However, we also recognise that while retailers are largely subject to supply and demand, they can also influence what consumers purchase. This informed the criteria we set in the framework for assessing retailers. We do care about what retailers sell, but it's not as simple as looking at revenue or sales volume of negative products.

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Translating into the framework

We do care about what retailers sell, but it’s not as simple as just looking at revenue or sales volume.

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Is there reason to believe they are selling a materially higher than market proportion of a negative product (i.e. relative to other retailers in the same sector)?

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Do product categories assessed as negative under the Charter (e.g. tobacco, alcohol, lottery tickets) in aggregate generate over half of revenue?

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Do they sell products assessed as positive under the Charter?

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Do they include sustainable alternatives in major product categories? E.g. a retailer selling meat should offer plant-based alternatives.

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Do they promote irresponsible consumption of products considered negative under the Charter (product placement, discounts, advertising)?

 
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Real world outcomes

Sales, marketing, operations and supply chains can have major real world outcomes. The larger the retailer, the larger the effect on these outcomes.

For example, retailers like Coles and Woolies are so large domestically that when they make a change, it can change the entire system – influencing diet transitions, climate, animal welfare, biodiversity and human rights.

We think they are genuinely trying to do the right thing and on balance are having a positive impact on the world.

update to framework

 

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Approach to tobacco retailing

Recent change to frameworks mean that retailers of harmful products are now assessed under the retail framework.
The effect is that we will not rule out retailers for tobacco or alcohol revenue unless there is reason to believe
their revenue is materially higher than market (i.e. relative to other retailers in the same sector).

A tobacconist would be ruled out under the retail framework. 

Explore

Assessing Coles
Assessing Coles

We assess Coles’ commitment and action to manage negative impacts on people, animals and the environment.

Assessing Woolworths
Assessing Woolworths

We assess Woolworths’ commitment and action to manage negative impacts on people, animals and the environment.

Ethical Criteria
Ethical Criteria

How we assess whether a company is having a positive impact and whether it is sufficiently managing any harmful impacts.

Australian Ethical acknowledges the Traditional Owners of the country on which we work, the Gadigal people of the Eora Nation, and recognise and celebrate their continuing connection to land, waters and culture. We pay our respects to Elders past, present and emerging and thank them for protecting Country since time immemorial.