Saving the planet with labels: can tags and accreditation change the sustainability game?

With the Covid-19 crisis, health and wellbeing have become core drivers for consumers, causing them to reassess their impact on the planet. The consumer shift toward a more ethical and healthier lifestyle, with the ability to compare products based on carbon footprints, should support more sustainable decision making. However, studies have found that while 65% of consumers globally are now more mindful about the impact of their overall consumption, only 53% have switched to lesser-known sustainable brands, indicating that there is a gap between intent and action.

There are multiple classification systems from Fairtrade and Rainforest Alliance to Carbon Trust and FSC. A lack of knowledge around what they stand for risks confusing consumers rather than educating. For example, Amazon launched its Climate Pledge Friendly program in 2020 to help customers identify sustainable products on its website by highlighting products’ sustainability certifications. On the surface, this sounds reputable, but dig a little deeper and you’ll find that the sustainability certifications may only apply to one aspect of a product’s sustainability (for example ingredients), but the finished product and its packaging are less environmentally friendly.

Another example is carbon labeling – displaying the carbon footprint of a product (measured in carbon dioxide equivalents, CO2e), calculated by measuring the total greenhouse gas emissions generated by producing a product from start to end. It’s not yet the norm, meaning brands advocating the use of these labels are not yet fully reaping the rewards.

It’s hard to empower consumers to choose your meat-free carbon-labeled products over a big hunk of meat if there’s no comparison between them. There’s also the difficulty that calculating the carbon footprint of each product is no mean feat, with different scopes of emissions to consider: direct from the organization (e.g. fuel combustion); indirect from the organization (e.g. purchased electricity and heat); and indirect from the value chain (e.g. waste disposal); as well as non-standardized calculations across organizations and countries. Add in the fact that organizations can abuse carbon labeling by offshoring greenhouse gas emissions to create the illusion that their products are more sustainable, and you can see why very few brands have made the change.

Should that stop us from trying?

According to a 2020 YouGov survey, 67% of consumers across the EU and US support carbon labeling of products. Early adopters of carbon labeling are starting to see benefits. In 2019, Oatly introduced carbon labels to all its oat milk products. Since then, it has made an impressive gain of £36.2m (+105.7%) in 2020, launching into fourth place among milk brands.

Quorn has held on to its top spot for meat-free brands after introducing carbon labeling in 2020. Other brands such as Panera Bread, a café chain in the US, have partnered with the World Resources Institute to introduce ‘Cool Food Meals,’ dishes designed with minimal environmental impact that can be identified by a smiling emoji.

Transparency around products’ carbon footprints isn’t confined to food brands; other success stories include the Future Planet section of the BBC website, with each article including an estimate of the carbon it took to report and publish the article, and Clim8 Invest, a sustainable investment platform that encourages investors to use their savings to make a tangible environmental impact through investing in clean energy, smart mobility and circular economy.

With an ever-increasing consumer base now looking for brands that echo their values around sustainability, and shunning those found lacking, it makes sense for brands to differentiate themselves from the competition by committing to sustainability labeling on all products.

How do we implement eco-transparency?

We can’t assume that giving consumers the cold hard facts about products’ carbon footprints is enough to change their buying decisions – price and personal convenience are still key drivers, especially for those on a tighter budget, or who have been furloughed or made redundant during the pandemic.

We need to invest in educating and engaging consumers around labeling and vocabulary to build familiarity and trust, and demonstrate that a brand is committed to fully reporting its environmental impact. For example, it has become the norm for brands such as Patagonia to publish details of their materials, ethical standards and supply chain logistics on their website for public consumption.

Other retailers, such as Asos, have begun to add ‘responsible filters,’ where consumers can filter products to find those made from recycled materials, or fabrics that use less water or are grown in healthy, pesticide-free soil. Ikea also has a section solely dedicated to products that encourage customers to phase out single-use plastic by recommending more eco-friendly options.

To further inspire customers, brands could offer rewards for those who try to reduce their environmental impact. For example, Alipay rewards users with ‘green energy points’ each time they make a sustainable choice, such as cycling to work, going paperless or buying eco-friendly products. These green energy points are visualized as a virtual tree on the user’s app, gamifying the experience; and for every virtual tree grown, Alipay donates and plants a real tree.

One to watch…

We can’t ignore the fact that a standardized approach to allow consumers to routinely compare products is possibly the most crucial of all. Nutritional signposting (think traffic light stickers on food products) was made mandatory in the 1990s, designed with a format that was both flexible enough to allow regulators to adapt to the changing landscape of nutritional knowledge, and accessible, standardized and easy enough for consumers to interpret. It’s now a widely recognized label, with studies of products with this labeling showing a decrease in sales of less healthy food options, demonstrating that giving consumers reliable and transparent information about what’s in their food can change purchasing behavior.

So how can we adapt the learnings from nutritional signposting to ensure products have labels that enhance the customer experience?

Foundation Earth, an independent non-profit organization supported by the UK government and brands including Nestlé, Sainsbury’s, M&S and Co-op, has recently been established to issue front-of-packaging environmental scores on food products. A pilot has launched this autumn to test consumer responses to this new labeling, calculated against water usage, water pollution, biodiversity and carbon, and uses color-coded tiers and letters to denote sustainability.

Perhaps this label will be the one to stick, the one that will become as ubiquitous as nutritional signposting, where all others have so far failed?