The Responsible Business Summit USA 2012
Discover how to fully embed and integrate CSR in your organization. Learn how to collaborate with key stakeholders and establish competitive edge using proven CSR strategies. Hear best practice from GAP Inc, Timberland, Lockheed Martin, Life Technologies, Campbell Soup and many more.
Eco-labels: radical rethink required
Sustainability labels should focus more on actual company performance
When we talk about the “eco-label model” we’re really talking about a combination of three things.
First, standards – a set of requirements, usually taking a consensus-based approach. Second, certifications – providing assurance of conformity against this standard. And, third, the eco-labels themselves – on-pack marks that indicate conformance with the standard.
This model came into being over 30 years ago, and, surprisingly, has changed very little in that time.
Pioneers
And until now, it could be argued, little change was needed. Certification, labelling and the standards-setting organisations behind them have been pioneers in building a more sustainable economy.
For businesses, they provide a credible reference point for collective action, access to expertise and networks, and can spur demand for certified or labelled goods.
But the mass proliferation of eco-labels in the marketplace – 400 and counting – and the move to mainstream for many (thus removing their value as a differentiator) is significantly reducing their value.
Couple with that the fact that the model itself – based on consensus and inclusiveness – is posing challenges for businesses seeking to take leadership positions in the marketplace.
Embedding sustainability
The time has come to rethink the eco-label model. Certification and labelling are time and money intensive; we can’t – we shouldn’t – certify and label everything. The aim behind certifications and the aspiration beyond labels is the creation of organisations and market systems that are just and sustainable in their entirety.
Rather than certifications and labels driving endless incremental improvement, it would be preferable if the future was built on increasingly rigorous, pre-competitive standards for sustainability performance, above which brands compete to make sustainability intrinsic to their mission and products.
In this future new business models will emerge whose DNA will embed factors previously requiring certification, and civil society will find more effective and efficient ways of holding business accountable.
A new direction?
There is evidence that such change is underway. Different types of certification are emerging.
Greenpeace has verified Nestlé’s commitment to no deforestation. The Better Cotton Initiative standard sets a base level sustainability standard for more sustainable cotton, but is not consumer facing.
And as a marketing tool, some companies have opted to use labels as a “back of pack” mechanism to complement the brand. For example, Method uses Cradle to Cradle certification as a design tool, which matches the brand’s design focus.
Outcomes not standards
In the future there is opportunity for businesses innovate to deliver outcomes rather than standards, complement certification with strong supplier-buyer relationships, and use the power of their brands to delight and mobilise consumers into adopting more sustainable behaviour.
In turn, standards organisations can stretch and innovate alongside business, certification will be complemented by new mechanisms such as partnerships and national regulation, and labels will fade into a quieter, background role, acting as trust marks for those who seek them, and leaving brands – and consumers themselves – to take the lead.
Heather Mak is a manager at SustainAbility. She is co-author of Signed, Sealed … Delivered?, SustainAbility’s new report on labelling.
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Comments
A mix of alternatives?
Hi Julian, in terms of regulation I see it as more an after thought - it will never really pre-empt the market. For pre-competitive standards for industry, there are a few in existence but they require an external presence to keep them credible. The Sustainable Apparel Index is manufacturer led but then you have NGOs like Greenpeace keeping some of their members - Nike, etc.) accountable on topics like toxics. So I think we'll see more of these pre-competitive industry standards, but it's probably slower than we hope, and will probably require a number of cooks in the kitchen!
your restaurant research
Hi Tom, we are noticing that certain companies, like Office Depot for example, are starting to just assess things on criteria (e.g. recycled content) and not solely on standards/certifications, which it sounds like you are doing. Would love to see the research when it is completed!
- Heather Mak
reply to your comments
Hi Brendan, thanks for your comments! Appreciated given your background with MSC and in sustainability more broadly. I wanted to address some of your concerns below.
As background - Signed, Sealed...Delivered? was deliberately business focused - we had done a broad sweep of other studies and publications on standards, certifications, and labels (see pg. 45-46 of the report) - and few focused on the business perspective and instead of "what label?", really taking a step back and asking, "why label?".
We also deliberately tried to not confuse standards, certifications, and labels in the report. We have defined them as such:
"— Standards set requirements to be followed by program participants, often taking
a consensus-based approach.
— Certification provides third party assurance that a product, process or service is
in conformity with certain standards.
— Labeling provides on-pack claims, marks or seals that indicate conformance
with the standard."
While most labels don't aspire to be famous, they are increasingly getting pressure to do so by companies, who feel they are shouldering most of the burden in awareness raising, and likely the reason why labels like FSC have hired a Chief Marketing Officer. When there are so many labels out there, I think there will be increasing pressure to do so.
Lastly and most importantly - we are NOT dismissing standards, certifications and ecolabels - they certainly have their place in the value chain sustainability toolbox and we are saying simply, that the traditional model of standards + certifications + ecolabels will need to evolve for greater impact.
We would love to have a further conversation with you - I've sent you my email address on Twitter - feel free to stop by our offices!
- Heather Mak
Pre-competitive Standards
I really like idea of strong pre-competitive standards for sustainability performance, but how do we get there? Regulation seems like the obvious answer, but I'm worry that it won't be strong enough and won't come fast enough. Indeed, ecolabels emerged in part because regulations weren't sufficient and there was a desire for a mechanism to recognize companies that exceeded the minimum required by law. Industry self-regulation seems like another possible mechanism through which pre-competitive standards might arise, but the history of industry self-regulation isn't all that promising either.
Confused by claims?
Without question a rethink is required, we're in the process of reviewing restaurant claims, it's a mine field - we look at ethics, carbon, certification claims, nutrition, price and any other claims made. A good amount of statements and claims made are at best based on misguided beliefs and poor science or just hiding something else - otherwise politely known as ambient rhetoric.
It's likely once we've finalised the research conclude the best indicators as being price (low - med.), calories (low), hygiene (good) and traceability (complete).
Eco-labels
You're confusing labelling and certification, which you use interchangeably throughout this post and indeed the report. Certification is a means, not an end. The label may be the end, but it isn't nearly as important as the certification process. How else to verify and measure ground level progress without certification? Of course, standards need to be broader and deeper, but that is an argument for more verification and certification, not less. Labelling is a wholly different debate - it's really up to brands how to communicate with their customers. That's why most labels don't aspire to be famous - they'll never have the resources to advertise in any case. Your report reads a bit like a pitch for business - is it? Until someone comes up with something as credible as independent certification I suspect the schemes you dismiss will be around, and growing. What stamps brands use is largely an irrelevance. Brendan May