1、Signed, Sealed. Delivered? Eco-labels, trust and behavior change across the value chain Phase One White Paper March 2011Signed, Sealed Delivered? Phase One White Paper 2 Todays supply chains span the globe. In the last fifty years, the value of internationally traded goods has increased from less th
2、an a fifth to more than half of world GDP. A couple of years ago, a shipping container followed by the BBC1went twice round the world in a year, hitting Scotland, Shanghai, Brazil and Los Angeles along the way. While a century ago we might have known where, how and who produced the things we eat, we
3、ar and use, in so many instances today all we know is what were told. Such geographic and mental distance between where a good is produced and where it is consumed brings plenty of benefit, but also has the potential to create significant problems. The eco-label, trust mark or certification just som
4、e of the names given to the independently verified, on-pack labels intended to communicate environmental and/or social performance to consumers strives to make production more visible. The concept of eco-labels is simple, but the reality isnt. Why trust in certain claims and not others? What actuall
5、y drives performance and market uptake? How do eco-labels compare to other ways of communicating product-level sustainability performance? And are product-based labels limited in their ability to deliver positive impact when it isnt the product alone that must be sustainable, but the system in which
6、 it is produced and consumed? This white paper documents the initial findings of a research project which will tackle these questions. 1 Context Patrin Watanatada Signed, Sealed Delivered? Project Director, SustainAbility Mark Lee Executive Director, SustainAbility Signed, Sealed Delivered? * For
7、simplicity, we are using the term eco-label to mean any independently verified label intended to communicate social and/or environmental attributes to consumers. (This is not intended to restrict the research to environmentally focused labels.) The focus of this research is explicitly on B2C rather
8、than B2B voluntary standards such as the ISO standards, food safety standards and so forth.3 Thirty-three years after the worlds first eco-label was launched (Germanys Blue Angel), hundreds more have appeared, focusing on a wide range of regions, issues, sectors, product categories and even business
9、es themselves. A number of trends indicate its time to take a closer look at the universe of eco-labels:* Businesses are under ever-growing pressure from civil society to demonstrate awareness of and influence over supply chain performance. From college students boycotting Nike and its supplier fact
10、ory labor conditions in the 1990s to Greenpeace activists dressed as orangutans rappelling down Unilevers London headquarters in 2008 to protest the use of palm oil from deforested plantations, its firmly established that we expect global companies to know the where and how of their raw materials an
11、d production. And, increasingly, consumers choose purchases based on these factors: the 2010 Global Ecolabel Monitor2quoted a 2009 Mintel study showing that “the green market outperformed the US economy as a whole in 2009 and grew by over 40% from 2004 to 2009.” Eco-labels are proliferating. As of t
12、he time of writing, the Ecolabel Index 3listed 377 schemes in 214 countries and 25 industry sectors, from Italys 100% Green Electricity to New Zealands Zque natural wool label. Meanwhile, new eco- labels continue to arrive. In the first month of 2011 alone, Vestas, the worlds largest wind energy com
13、pany, announced the development of a WindMade label 4backed by WWF and the UN Global Compact; a group of US food manufacturers signaled their intention to develop Nutrition Keys, 5a front-of- pack nutritional label; and the Enough Project launched a project arguing for the need for a robust certific
14、ation process for conflict minerals 6sourced from Congo and the surrounding regions. While the sheer number of eco-labels surely has contributed to rising awareness among consumers, it is becoming harder for a product to differentiate itself through their use, particularly as consumers become overwh
15、elmed and cynical. Bold sustainability commitments by brands demand credible ways to evaluate the progress of their value chains. From Unilevers commitment to source 100% of its agricultural raw materials sustainably by 2020 to Pepsico UKs commitment to reduce carbon and water emissions from key gro
16、wers by 50% by 2015, many businesses have set big hairy audacious goals related to their value chains and need credible ways to demonstrate that these have been met. Some eco-labels are losing trust. Even respected schemes have been questioned. The Marine Stewardship Council was recently accused of
17、certifying fisheries where stocks are diminishing, while detractors have claimed that the EU Ecolabel certified paper made from Indonesian virgin rainforests. Regulators are keeping a stern watch on greenwashing claims. Both the US Federal Trade Commission (FTC) and UKs Defra are completing major re
18、views of their green marketing guidelines. Eco-labels are moving into developing country markets. Eco-labels have been primarily a European and North American phenomenon, but the Ecolabel Index includes dozens of labels used in Latin America, Africa and (especially) Asia, in part due to the EU-funde
19、d SWITCH-Asia network seeking to transfer leading practice in eco-labeling 7from Europe to Asia. With evidence that demand for sustainable products & services is growing in these regions, Asia has an opportunity to leapfrog as well as to take the best of eco-label practice from Europe and North Amer
20、ica. 2 Trends Phase One White PaperSigned, Sealed Delivered? 4 Eco-labels themselves are re-assessing and re-invigorating. ISEAL Alliance, the global alliance for environmental and social standards systems, is completing a major strategic review 8of how voluntary standards should evolve in order to
21、scale their impact, while last year WWF published a review of multi-stakeholder initiatives, Certifications and roundtables: do they work? 9 and concluded that more evidence was needed and operational improvements required. So eco-labels are everywhere, and more are on the way. But what exactly are
22、they trying to do? We expect a great deal from these labels: social and environmental impact, credible yet simple assurance on sustainability claims, brand value and a return on investment for all concerned. Lets look a little more closely at these expectations. The basic purpose of an eco-label is
23、to tell the consumer a credible story about whats happening in the rest of the value chain. This story is intended to create demand for more sustainable value chains by influencing (or affirming) performance improvements upstream and purchasing decisions downstream. This all suggests that eco-labels
24、 have three distinct functions: 1 Performance. Influence and/or affirm improvements in social and environmental performance through voluntary standards. 2 Trust. Provide credible assurance around sustainability performance to consumers, customers, NGOs and other stakeholders. 3 Demand. Drive purchas
25、ing decisions and behavior change by communicating sustainability performance to consumers at the point of purchase, and more broadly, by increasing awareness and changing the social norms and expectations associated with a product category. Is it realistic to expect any single eco-label to achieve
26、such varied goals? Which eco- labels are doing this best and what can we learn from their success and acceptance? And what alternatives exist? 3 What are eco- labels trying to do? Phase One White PaperSigned, Sealed Delivered? 5 Certainly, many eco-labels from Energy Star to Fairtrade have done a gr
27、eat deal to raise awareness, to change what we expect of certain product categories, and to create a common language and framework around sustainability. In informal conversations held during the drafting of this white paper, interviewees credited eco-labels with: Creating a common language and fram
28、ework for sustainability. As one person we talked to said, “Certifications simplify the discussion they help people who arent experts know what to act on.” Eco-labels create consensus around what is important so that each organization doesnt need to re-invent the wheel. Providing opportunities for c
29、ollaboration. Partnering with an independent scheme can be a way of outsourcing the work of supplier capacity-building or monitoring (and, frankly, transferring risk to the eco-label and its supporting standards and verification scheme). Many eco-labels are associated with collaborative forums for s
30、haring best practice. Providing a credible platform for claims. Everyone we spoke with said that that there is no doubt that schemes backed by government standards, multi- stakeholder initiatives or NGOs have greater credibility than business claims without the same backing. Raising consumer awarene
31、ss and expectations. One of us recently went to speak about ethical trading at a London girls school and learned that most of the students had first become aware of supply chain issues because of the Fairtrade mark, which has very high consumer recognition in the United Kingdom. Or consider coffee:
32、all of the big roasters and the major coffee retailers worldwide now offer some form of sustainably sourced coffee, to the point where it is no longer very much of a differentiator. Improving performance. WWFs 2010 review of multi-stakeholder initiatives concluded that “MSIs can have positive econom
33、ic, environmental and social impacts.” The US Environmental Protection Agency stated in their annual report 10that the Energy Star label contributed to saving the equivalent of 31 million vehicles worth of GHG emissions and $17 billion in utility bills in 2009. 4 Successes . . . Phase One White Pape
34、rSigned, Sealed Delivered? 6 Alongside these successes, challenges exist, and questions are being asked about eco-label efficacy: What impact are eco-labels really having? Many eco-labels have found it challenging to demonstrate positive impact. Indeed, the 2010 Global Ecolabel Monitor 11found that
35、only one-third of the eco-labels who responded to their survey regularly monitor their impacts. WWFs 2010 review 12noted “insufficient comparable and meaningful data available” on the impacts of certifications and roundtables. Even where it is possible to demonstrate positive impact, improvements ma
36、y occur primarily among players who are already reasonably strong performers, and it is extremely difficult to ensure rewards for improvement are reaped fairly across the value chain. Are the standards behind labels the right ones? Setting standards for a set of issues as complex as sustainability w
37、ill never be straightforward. Too often the most important drivers of better performance are set aside in favor of indicators that are easier to measure or that are of more obvious interest to a broader range of stakeholders. While there is some justification for this, it limits ultimate progress. A
38、re eco-labels making use of the right amounts and kinds of data? This question is at the heart of many of the challenges associated with eco-labels, because the information needed to drive, verify or communicate performance is so different. The data that a designer needs, for example, to design a lo
39、wer- impact shoe is often different from what the consumer needs to make a purchasing decision. The data that a food manufacturer needs to be confident that its agricultural suppliers are reducing their carbon footprints may be different than the data the suppliers use to drive reductions. How trust
40、ed can business-led standards be? As noted above, the most trusted labels are those based on government standards, like organic, LEED and Energy Star in the United States, or those backed by NGOs. Business-led standards remain less trusted by consumers even when they are recognized as high- quality
41、standards by stakeholders. This question will become more important as businesses increasingly develop their own standards. Can branding sustainability lead to undesirable consequences for marketers? Many independent eco-labels are powerful brands in their own right, competing not only with each oth
42、er but also with the host brand. In a fiercely competitive market, some firms find it difficult to invest in marketing eco-labels that may be used by competitors. Meanwhile, the battle for consumer mindspace is such that many businesses are reluctant to share it with a sustainability label or claim
43、if it does not perfectly support their own brand story. Can branding sustainability lead to undesirable consequences for sustainability? By calling out a specific product as sustainable, labels might distract consumers from a more sustainable but un-certified choice for example, when ordering fish a
44、t a restaurant, diners might be more likely to choose MSC-certified Chilean seabass over less endangered and therefore un-certified grouper. Or, if shoppers choose a cereal that happens to consist of 41% sugar by weight 13because of the presence of the Smart Choices label rather than oatmeal, has pr
45、ogress been made? Labels may create undue focus, resulting in potentially less desirable individual choices and leading consumers to think about single issues rather than the system. 5 . . . Challenges Phase One White PaperSigned, Sealed Delivered? 7 Along with or instead of the traditional independ
46、ent eco-label, businesses have been making use of other ways of improving performance, creating trust and influencing demand for more sustainable products. A few weve identified so far: In-house standards. Such as Starbucks CAFE Practices or HP Eco Highlights. Industry standards. Such as the UL Envi
47、ronment manufacturing standards, the Sustainability Consortiums various working groups and the newly- launched Apparel Index. 14While these are not in themselves consumer-facing, most intend that the metrics can and will be used to underpin consumer communications. New sourcing models, partnerships
48、with NGOs and in-house expertise. Either to complement or instead of in-house standards and labels. For example, Walmart is increasing its purchases from small and medium-sized farmers as part of its sustainable agriculture program, while Unilever is building up its in- house team of agronomists. Li
49、nking sustainability performance to the place of origin instead of a label. Some Alaskan fisheries have considered forgoing MSC certification, in part under the assumption that buyers already know that fish sourced from Alaska is sustainable, 15while Molsons new “Made from Canada” campaign positions the beer as made from pure Canadian water and hops, and by extension as environmentally friendly. Tagging and mobile technologies that c
