Affluent Gen-Zers are actively more eco-conscious when buying fashion - report

By

Sandra Halliday

Published
Feb 6, 2023

Brands ignore environment, social and governance (ESG) issues at their peril with Gen Z’s fashion choices now being increasingly divine by a label’s ESG stance. Those consumers are also taking investment decisions from the same viewpoint and may not buy shares in a company if its ESG approach isn’t up to scratch.

That’s according to a report from financial technology and investment specialist Saxo.

It analysed survey data from a number of sources and said over a third of Gen Z won’t purchase from eco-unfriendly brands or from brands lacking in equality and diversity. And over half of Gen Z are more eco-conscious when investing in fashion brands.

Looking at data from sources including The Motley Fool, Bank of America and Remake, among others, Saxo said that when making purchasing decisions, Gen Z consumers who are also share investors rank ESG qualities highly on their list of considerations. Some 51% say how a brand's environmental sustainability, ethical trading, equality, and diversity have become more of a factor in how they buy clothes, accessories, and shoes over the last 12 months. 

That’s significant because those buying shares are likely to be more affluent in general.

That said, 26% admitted they wouldn’t pay more for sustainable and ethical clothing, accessories or shoes, so they’re clearly expecting eco and ethical to be the norm rather than a premium-price add-on.

As many as 46% said they’ve abandoned or decided against a fashion purchase because they felt that the brand or retailer didn’t reflect their values on sustainability, ethics, equality or diversity. 

As well as those purchase decisions, it’s particularly interesting that Saxo has also looked at whether Gen Z would buy shares in a particular company as well. That may not affect a brand’s revenue figures today, but with Gen Z growing older, richer and not far off being the most populous generation (who will one day be the business and political leaders making decisions about everyone’s lives), the attitudes they have really count.

Saxo also cited information from Remake showing the highest-scoring fashion firms in a variety of categories, including traceability, wages and wellbeing, commercial practices, raw materials, environmental justice, and governance. Scoring highest were Burberry and Levi Strauss & Co, “which happen to be among the most traded stocks by Gen Z”.