“The very traits — governance and inclusiveness — that make
consensus-based standards so useful as credible mechanisms for collective
action also pose challenges for businesses seeking to move quickly and to
differentiate themselves in the marketplace. And like any tool, certification
and labelling have limits — including limits to scale.” concludes a report from
the consultancy Sustainability,
33 years
after the world’s first sustainability label (Germany’s Blue Angel) appeared,
certifications and labels are now everywhere. The Ecolabel Index lists 426
certifications and labels in 25 industry sectors and 246 countries as of
November 2011. Around two-thirds of these were developed in the last decade
alone, and new schemes continue to arrive. And as our own research, the Organic Standard Directory shows that there are at least 124 organic standard, but probably many more, Nowadays it’s stating the obvious
that consumers are confused by the sheer number of certifications and labels:
according to the Natural Marketing Institute, 51% of American consumers think
“there are too many green seals and certifications”; Only 42% of American consumers
recognize Rainforest Alliance, 26% LEED and 19% Forest Stewardship Council,
although 95% recognize Energy Star and 76% recognize USDA Certified Organic.
In the
report “Signed, Sealed...
Delivered? Behind Certifications and Beyond Labels”, the UK based consultancy Sustainability
asks “Why certify or label?” The report, based on 85 interviews with
businesses, standards-setters, certifiers and other expert observers as well as
desk research places the question in the context of other ways available to businesses
for improving or communicating sustainability impacts across the value chain.
The
interviewed businesses expressed frustrations with the soundness of criteria
(“based on perception or politics, not science”, “popular only because it was
the first”), the level at which requirements are set (“too low — we can’t
differentiate ourselves”), the fit for the business (“requires us to change our
processes for no reason”), or the failure of the standard to adapt to new
knowledge or processes (“hampers innovation”).
Committing
to a single standard can limit sourcing flexibility in the case of raw
materials standards. Agricultural certification illustrates this challenge
emphatically. “At the moment, certification is the only process we have, but at
some point we’ll have to jump to a completely different mechanism,” states Jan
Kees Vis, global director of sustainable agriculture at Unilever. “We’re not
going to certify every farmer in the world, we can’t create a roundtable for
every raw material.” Another risk for businesses is that participation in a
labelling schemer ties them to the reputation and viability of the
standards-setting organization. The reports predicts that the model of a standard, certification and label on
one coherent system carrying most of the message will fade. Sustainability believes that in
the future sustainability certifications will be moved to the back-of-pack,
metaphorically and literally.
I do agree with this analysis. I have been working with this sector for three decades, and while I still think there are many merits in eco labels and organic labels, I think it is increasingly apparent that there are many in-built limitations in what they can deliver. As I write in Garden Earth: "The attraction of an eco label, for businesses and
consumers alike is to differentiate a product from other products that are
without the label. But the more successful the label is the less value it has
in a competitive market."
Don't buy organic instead of changing the world - do it as part of changing the world
Sustainable coffee is increasing, but only 35% is sold as such.
How fair is fair?
What gives value to an eco label
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