What: Wealthy people are less willing to spend on sustainable products.

Why it is important: People in a higher income bracket are less likely to pay more for sustainable goods.

Innovation to create sustainable beauty and fashion products and their packaging can be costly. But it’s not the wealthiest consumers that are the most interested in spending for eco-friendly practices, according to a new study by venture studio and brand incubator Squared Circles. The company has invested in brands like Nutrafol, which sold to Unilever, and $135-sweatshirt brand Pangaia.

The new research report, out on April 22, finds that over half of its 3,000 survey respondents are willing to make lifestyle changes to support sustainability. Sixty-four percent of those surveyed said they “recognise the need to compromise the way we live to ensure sustainability.” But that number drops when it comes to paying higher prices for sustainable products and practices, especially among consumers in a higher income bracket.

Among the surveyed group, 52 percent expressed a willingness to pay 10 percent more for a sustainable product. However, when excluding respondents with a household income below $100,000, this percentage decreases to less than half, at 45 percent.

Lukas Derksen, co-founder of Squared Circles, noted that wealthier consumers tend to scrutinize their spending habits more closely, which may explain their reluctance to pay higher prices for sustainable products.

Gen X respondents, particularly those categorized as "Conscious Maximalists," expressed skepticism about sustainable products, with 27 percent more likely than average to strongly agree that such products don't live up to the hype.

On the other hand, the youngest segment of surveyed consumers, mainly aged 18 to 45 and identified as "Passive Activists," showed greater willingness to spend on sustainability. Seventy-six percent of this group believe that companies should be able to charge 10 percent more for sustainable products, with 70 percent willing to make the purchase. Interestingly, income levels did not significantly affect these attitudes, as both higher and lower earners in this group demonstrated similar willingness to support sustainability, with 74 percent agreeing that lifestyle compromises are necessary for sustainability.

However, quality remains a non-negotiable factor for most consumers when it comes to sustainability. Only 35 percent stated they would purchase a product with lower performance if it were more sustainable.

The wealthy are less willing to spend on sustainable products