At any supermarket in North America you are greeted with packaging covered with a mix of fair trade labels, organics labels, vaguely green labels and recycling labels, not to mention a myriad of health and nutrition icons. Consumers not only have to choose between the 15 different types of dishwasher fluid, but they need to decide which cause is most important to them. Are ethical concerns more important than the environmental lifecycle of the product? A further step involves determining which of the multiple labels within a category is better than the others.
A well-known French phrase comes to mind: trop de choix tue le choix, or “too much choice kills the choice.”
The rationale behind environmental labels, or ecolabels, is to give consumers more information about a product so that they are able to make an educated choice. For Etienne McManus-White, chief marketing officer for the Forest Stewardship Council (FSC) in the U.S., it’s about empowering the consumer. “What we found when we did focus groups in the U.S. was a perception issue,” she explains. “They think that being green is going to be hard.” Ecolabels inform consumers that more sustainable choices can be found at the regular stores where they shop, and they reward companies who go through the certification process with increased consumer demand.
Ecolabels are also meant to stimulate research into cleaner products. Companies like General Electric have poured money into producing appliances that comply with the U.S. Environmental Protection Agency (EPA) Energy Star program, while German chemical company BASF has rolled out its own green product logo for household cleaning and other supplies that involve more green chemistry.
According to Mario Abreu, the head of recycling and supply chain support for Tetra Pak, consumers are becoming much more aware of ecolabels and have incorporated them into their shopping routines. The company recently completed its yearly survey of 7,000 consumers in 12 countries, and was surprised by the results. “The amount of people who say they sometimes seek out an environmental label and act on it grew from 42 per cent in 2005 to 65 per cent in 2013,” he recently told an audience at the FSC In Good Company conference in Copenhagen. “It really stands out as a trend.”
The first ecolabels emerged when the Canadian government unveiled the EcoLogo system in 1988, followed by the Nordic Swan system in Northern Europe the following year. The Ecolabel Index, a global directory of ecolabels, now keeps track of 441 ecolabels used in 196 countries, covering 25 industry sectors administered by governments, nongovernmental organizations and industry alliances. That’s compared to 300 in 2010.
The main reason for the continued increase of ecolabels, according to Ecolabel Index co-founder Trevor Bowden, is the ever-growing purview of sustainability advocates. He believes that the range of issues that labels are attempting to address through certification has grown to keep pace with the broadening scope of the global sustainability movement. New certification regimes include the Wildlife Friendly logo, which certifies companies that help conserve threatened wildlife, along with the Food Justice label, which ensures that farm workers are treated fairly.
There are three different bodies that produce ecolabels: governments, such as the European Union’s Ecolabel and the EPA Energy Star; NGO-led organizations such as the Marine Stewardship Council (MSC) and the FSC; and industry, with such labels as Nike’s Considered Design logo.
For Shana Starobin, an expert in ecolabelling at Duke University, the rapid increase in labels has opened the door to a range of “greenwashing” and other dubious claims from industry. Some certification regimes are not audited by third parties, while others are largely funded by industry groups. Top certifiers maintain challenging certification guidelines, while laggards have weak standards and lack basic forms of transparency. Situations where funding for the certification organization is derived from fees charged to certify create a glaring conflict of interest.
The certification process for organic livestock and crops in Canada was called into question in fall 2012 after it was revealed that nearly 24 per cent of apples tested in an internal investigation contained traces of pesticides. Agencies certified by the Canadian Food Inspection Agency do not conduct mandatory testing of products, which has led to widespread abuse of the system. In an incendiary report released by the Frontier Centre for Public Policy, a Winnipeg, Manitoba-based think-tank, the authors declared “it amounts to little more than an extortion racket, one that the greediest of mafiosi would envy.”
A comprehensive survey of managers and sustainability practitioners conducted by two professors at Switzerland’s International Institute for Management Development (IMD) last year identified a number of problems with the system. After surveying 1,000 managers and sustainability professionals from 70 countries, the researchers found the ecolabelling landscape to be “overwhelming and confusing for companies and consumers alike.” The fragmentation of ecolabels and the lack of consensus on criteria were also identified as key challenges.
For some, the challenges with ecolabels are significant enough to consider dropping them altogether. Duncan Pollard, associate vice-president of stakeholder engagement in sustainability at Nestlé, was candid in his reservations to the Swiss researchers. “Fifteen years ago, certification and ecolabelling was considered to be the way forward,” he wrote. “Now, we may be seeing the limits of its ability to transform markets and experiencing the first serious reappraisal of the conventional wisdom that if you wish to prove that you are sustainable you need a certification logo to prove it.”
Several ecolabels have managed to break away from the pack and establish themselves as strong brands, including the FSC and MSC. Increased popularity has led to greater consumer familiarity, which has created a positive feedback loop. Being beholden to the dominant ecolabel in an industry can lead to its own problems, however, as Walmart recently found out. Alaskan wild salmon fishermen refused to be re-certified by MSC, due to both the cost involved and to object to what they viewed as weakening sustainability standards. As this went against Walmart’s all-MSC policy for fish products, a rumour began that Alaskan fish products would start to disappear from its shelves. After Walmart’s CEO received angry letters from Alaska Senator Mark Begich and Governor Sean Parnell, fishermen began protesting outside its stores. Jeff Rice, senior director of sustainability for Walmart, admitted at a senate hearing in September that the company was in the process of re-evaluating its policy.
Experiencing consumer confusion and industry frustration first-hand through their own certification regimes, some governments have moved to push standardization as best they can. The U.S. Federal Trade Commission issued updated guidelines last year for companies wishing to market products as eco-friendly, in an attempt to cut down on deceptive advertising and eliminate some of the weakest ecolabels. In Denmark, the Consumer Council and the government are conducting an analysis of ecolabels and identifying areas of duplication where consolidation could occur.
The most promising development of them all is emerging from the European Union. The French government conducted a labelling experiment in 2012 as part of the Grenelle II Act, involving 168 companies and allowing them to display environmental information however they liked. The only requirements were that it had to include a carbon footprint figure, along with any other environmental indicator they chose. All information needed to be bolstered by a life-cycle analysis available online. Meanwhile, the European Commission is looking to harmonize life-cycle methodologies across the EU through the Single Market for Green Products initiative, and is currently analyzing the results of the French experiment for consideration as part of a broader EU program.
With new ecolabels entering the market every year, tools to help consumers navigate the world of ecolabels have also begun to crop up. One of the pioneers in this field is GoodGuide, which features a comprehensive product guide using environmental, health and social data. After being purchased by Underwriters Laboratories last year, it announced in October that it will be partnering with Target to roll out a Sustainability Product Standard for three in-store product categories. GoodGuide is also working on a business-to-business platform to help companies embrace sustainable purchasing practices.
The Danish Competition and Consumer Authority has created an interactive feature to learn more about labels on its website, while Environment Canada maintains a similar tool for understanding logos at grocery stores. Apps for consumers have begun to proliferate, including the Consumer Reports ecolabel app. Some companies are taking ecolabels to an entirely new level, with places like San Diego restaurant Harney Sushi featuring a QR code printed directly on rice paper, which takes you to the National Oceanic and Atmospheric Administration’s FishWatch site.
Time will tell if ecolabels will multiply themselves into irrelevance or continue to rise in the estimation of consumers and businesses. But whatever happens, don’t print it on my sushi.