Pick of the green crop

It is worth taking a step back from the green business boom to reflect on a notable journey.

In 1986, the UK's first ethical investment fund, Friends Provident's Stewardship Fund - launched to shun polluting industries - was dubbed the 'Brazil fund', because you'd have to be nuts to invest in it. Somewhere, however, the sniggering stopped and the 'ethical' (social and environmental justice) penny dropped. Adead planet is, after all, a rather unproductive one. Similarly, a brand reputation that has cost millions to nurture can be shattered in seconds, by a toxic spillage or pictures of poorly paid workers chained to sewing machines. While some companies have yet to figure this out, or persist in fudging the issue, progressive companies have taken a stance by pursuing a 'green' or 'ethical' agenda. Increasingly, these are seen as the smart players.

On a less cynical note, some entrepreneurs actually see commerce as a force for good and even attempt to change the world with their business skills. Arguably, this builds on the tradition of hippie-commerce pioneers such as ice-cream makers Ben Cohen and Jerry Greenfield (Ben & Jerry's famously later sold out to Unilever) and the late Anita Roddick.

It's the type of ethos we recognise through the Observer Ethical Awards (the third awards will be launched in January), in which the recipients don't always fit a conventional business model. Last year's winner of the Best Online Retailer award, for example, was Infinity Foods, a 30-year-old Brighton co-operative that in its time has been considered as nutty as the aforementioned Friends Provident fund. Meanwhile Galahad Clark's firm Terra Plana, purveyor of the recycled trainer and vegetable-dyed leather court shoe - all ripe for disassembly to enable further recycling - bagged the 'best fashion product award'.

Terra Plana is a good example of the new breed of smaller green UK businesses. 'These are companies often founded by people who have these authentic green and ethical values,' agrees John Grant, whose new book, The Green Marketing Manifesto (John Wiley) has just been published. 'Often they mix creativity with a raw need to curb the inefficiencies of something prosaic like consumerism. If you look at the marketing behind a brand such as Howies (the Cardigan Bay ethical clothing brand recently bought by Timberland) or Innocent (the smoothie producer), it's all about injecting joy into green ideas. Many of these young British businesses are putting the delight into life again but, at the same time, transmitting a green message, and that's what's interesting.

'There's an historical precedent here,' he adds. 'The last time we got this scared about something, it was Aids. Our response was the apocalyptic tombstone advert. Then it was about promoting safe sex and condoms - enjoyment and fun but with restraint. That's what green businesses are increasingly doing.'

But why should Britain's green business scene be so particularly vibrant? There is a notably more dynamic green business scene here than in more 'green' countries such as Sweden or Germany. 'Britain is one of the few countries where the penny has dropped that business can be a force for change,' continues Grant, 'plus, historically, we've always had a lot of entrepreneurs here.'

Here are 10 more of the brightest independent UK green businesses:

The packaging-free shop

Unpackaged www.beunpackaged.com

Catherine Conway's business, Unpackaged, took a giant stride a fortnight ago with the opening of her first shop, in London's Islington. Conway's quiet, considered approach - she began in 2006 with a grant from social enterprise charity Unltd (www.unltd.org.uk) - has begun to reap dividends. An organic grocery business, it makes the ostensibly audacious request that shoppers bring their own packaging. Organic wholefoods, fruit and vegetables, eco-friendly cleaners and toiletries are all available in refills, saving customers' money by removing the need to pay for packaging (the average British consumer spends £460 a year on unwanted packaging).

Conway initially tried out the concept in two London markets, a process she describes as 'exhilarating, as it immediately took the idea of Unpackaged from a concept into a real-life business where we could talk directly to our customers and gauge their reaction to our idea'. They liked it; Conway was providing a proper alternative to over-packaging, the bete noire of the responsible consumer.

The most exciting part of the business journey so far, according to Conway, was developing her own range of reusable bags that customers can purchase. Each is designed to be reused 20 times. Unpackaged also cleverly gives individuals an opportunity to make a difference. 'If others follow Unpackaged's lead we can make a really important difference, demonstrating that individuals can actively help to save the planet,' says eco enthusiast Jonathan Dimbleby.

The green recruiter

EnvironmentJobs www.environmentjobs.co.uk

This is where you log in if you're an environmental professional looking for a job in Abu Dhabi, for example. Sideline ventures include the annual Green Directory and ADCEnvironment's monthly recruitment magazine, Environment Post. Andy Coleman began the business back in 1994, when he left university as an environmental graduate and found there was no central point for environmental jobs. Coleman, who describes himself as an atypical tree-hugger - more of 'an Essex boy who loves business' - pursued a well-trodden route to get his business off the ground, temping in London for three months and receiving advice from the Prince's Trust. Turnover is now £200,000 and he has six staff. Next he is planning an organic recruitment site, where you can go to find jobs in pesticide-free food, farming or cosmetics. Oh, and on the subject of cosmetics he's also launched an organic cosmetics label, Poppy Organic. 'It's just great, after so long being virtual, to have an actual product,' he says.

The eco design consultancy

Giraffeinnovation www.giraffeinnovation.com

It's a stark warning: 'No company, no matter how adroit, can make money from a poisoned population and a dead planet,' says Rob Holdway, described as Britain's leading eco design consultant (and also a member of the Observer Ethical Awards expert panel). And so Giraffe sets about advising companies on innovation management, sustainable design, carbon management and EU environmental legislation. Its client roster includes corporate behemoths Virgin Atlantic, Toyota and Orange - not to mention the UK government - all of which it advises on how to avoid doing the 'wrong thing well'.

If a company is resistant to having its environmental conscience pricked, it might like to consider the fact that helping organisations 'green' their products can often help them sell more of them. In most projects Giraffe claims it can identify potential savings of 20:1 on the company's consultancy fee and has, to date, identified £50m in savings for its clients - an added fiscal ingredient to add to any nascent altruistic leanings.

The green shopkeeper

Eco www.eco-age.com

Although the British are allegedly a nation of shopkeepers, it's taken two Italians, sister and brother Livia and Nicola Giuggioli, to make this eco retail/consultancy vision happen on Chiswick High Street. In fact, Eco isn't just a store, it's a showroom, consultancy and green destination where you can buy a bamboo bicycle or get advice on the best photovoltaic panels. 'There is nowhere else in the UK you can get the best advice and the best ecological products,' says Nicola with feeling and he's convinced the country isn't there yet. 'Being green is still perceived as a cost rather than an investment and the bureaucracy doesn't help,' he says, 'but we are working on it!'

The fact that the team of seven working on it includes Livia, who is married to actor Colin Firth, doesn't hurt when it comes to publicity. As Vogue predicts, the newly opened Eco will be 'a shop to fulfil all eco dreams'.

Hemp streetwear

THTC (TheHempTradingCompany) www.thtc.co.uk

Hemp is a substance much maligned and misunderstood. Legend has it that newspaper magnate William Randolph Hearst exaggerated its narcotic properties to discredit the fibre that threatened his extensive cotton interests. Decades later, brothers Dru and Gav Lawson are here to redress the balance, declaring hemp 'potentially the world's most useful crop, with thousands of byproducts including clean engine fuel, paper, food and eco-plastics'. Commercialising hemp through a global streetwear and sportswear brand, THTChas worked closely with DJs, MCs, bands, comedians and actors to grow from the two brothers in 1999 to a team of nine staff based in west London with turnover of £100,000. Anybody who is anyone wants to be seen in a THTCT-shirt, and that includes film star Brad Pitt, dub poet Benjamin Zephaniah and rappers De La Soul. 'Over the last three years, the UK market has really embraced organic and ethical fashion. It seems demand and awareness are only set to grow from now on,' says Dru.

The eco sportswear brand

Finisterre www.finisterreuk.com

If I had a pound for every bunch of surfers who told me they were setting up a clothing company, I'd probably be able to set up my own. Somehow, something - possibly surfing - always seems to get in the way. But not with Finisterre, a collective of four exceptionally committed young entrepreneurs. Their 2007/08 product line claims to be 'the most ethical technical product line globally', courtesy of a design department that works with leading universities and scientists to develop eco materials ranging from recycled polyesters, a polycotton jacket impregnated with beeswax (a sustainable weatherproofer) and ethically sourced New Zealand merino. Plus they have developed a waterproof system based on biomimicry, an important ecological concept that mimics the processes of nature in the name of sustainability. Overall, these four Cornish guys under 30 have achieved the sort of green credentials that major players in the active sportswear scene can only dream about. Not all that surprisingly, they'll be telling their story at the What If! Live event, billed as the showcase for the world's most sustainable companies, alongside Al Gore on 28 November.

The organic cosmetic gurus

Neal's Yard Remedies www.nealsyardremedies.com

Although the distinctive little blue bottles and jars have been familiar to millions of holistically minded consumers for more than 20 years (Romy Fraser started the business in 1981), NYR is here because it has undergone something of a sustainable makeover in the last 12 months since organic pioneer Peter Kindersley bought a controlling stake in the business. Central to this update was the transfer of production to an eco-factory in the heart of Dorset (which is being fitted with wind and solar capabilities), where the business has expanded its environmental commitments. It has long offered the biggest range of natural, certified organic health and beauty products in the UK, as well as an adjunct complementary medicine service. Most herb and flower ingredients are organically sourced, others are 'wild harvested' (plucked from the countryside). The company does not use man-made chemicals such as parabens and phthalates - attributes that sit well with the burgeoning green consumer market - and last year's turnover had a rosy complexion at around £11m.

The energy monitor

DIY Kyoto www.diykyoto.com

It was in 2004 that three former Royal College of Art graduates came up with a device with the potential to convert us from being a nation of wasters. And, unlike the energy monitoring devices that had gone before, their Wattson device, a stylish box that wirelessly monitors and displays power usage, was aesthetically appealing.

However, even with a product that seems to tick all the right sustainable-design boxes, the road to solvency was far from as simple as flicking a switch: 'It has been a long and hard road for DIY Kyoto to create a business, design and produce our own products,' says Greta Corke, one of the original triumvirate. 'We believe in change of behaviour, and that is what keeps us going.' Last year DIY Kyoto 'took a big risk' by electing to manufacture the product themselves -a risk they describe as worth it, 'because this is a product and a brand we completely believe in'.

The sustainable consultancy

Beyond Green www.beyondgreen.co.uk

'You can build the world's fanciest green buildings, but unless people modify their behaviour within and around them they'll probably continue to have an unsustainable impact on the environment,' says co-founder Jo Yarrow. Beyond Green, the consultancy she set up with partner Jonathan Smales in 2004 from their spare bedroom, is now a £1.8m business with offices in London and Newcastle, branching out from sustainability strategy and policy to include Beyond Green Lifestyles, Bespoke Green (a service for homes) and a property enterprise. 'The burgeoning creativity and surge in new businesses working in sustainability across sectors is very exciting,' says Jo. 'However, this doesn't yet add up to a broad political and cultural movement - "sustainability" is still seen as something separate to mainstream life, and to involve sacrifice rather than enhancement.'

Paul Murrain, senior design director of the Prince's Foundation for the Built Environment, was struck by their vision from the outset. 'They took me to task after a lecture in which I criticised the anti-urbanism of environmentalists. I realised I'd at last found a group of people with a genuinely holistic view of our contemporary condition. They support me, challenge me, advise me. If they quit and buy a pub, I'll be lost.' Fortunately, they have no plans to buy a pub.