An Evaluation of Labelling as a Mechanism to Communicate Sustainable

An Evaluation of Labelling as a
Mechanism to Communicate Sustainable
Development Criteria of Food Products
AIM: To explore the potential of labelling as a mechanism to provide an indication of the sustainability
performance of a food product in a way which is accessible and understandable to the consumer
Sustainable Development (SD) is defined by the Brundtland
Report ‘Our Common Future’ (1987) as ‘development that
meets the needs of the present without compromising the
ability of future generations to meet their own needs.’
A label was defined as 'a distinctive symbol
revealing differences between more sustainable
and less sustainable practices, which consumers
might have been aware of but which they could
not identify in the market.'
(Boer, 2003)
What we do about food is ‘intimately concerned with the whole
problem of the pollution and exhaustion of our environment,
with the danger that man may make this planet uninhabitable
Kloppenburg (2000)
within a short century or so.’
SD CRITERIA
Sustainable Development
issues affected by the growth,
harvesting, processing,
transportation, sale,
consumption and waste disposal
of food products include:
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Air miles
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Air pollution
Air transportation
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Animal rights
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Biodiversity impact
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Culture and heritage
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Disposal facilities
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Ecological footprint
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Education for local area ?
Employee education ?
Employee rights
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Employee safety
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Energy use
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Fuel consumption
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Genetic modification ?
LABELLING REGULATIONS (Defra, 2003)
Green claims must allow space for mandatory
information, not mislead or confuse customers, be
relevant, accurate and verifiable, and comply with
standards set by the Advertising Standards Authority.
SUSTAINABILITY
Greenhouse gas
emissions
Labour laws
Local development
Material use
Noise pollution
Nutrition
Packaging usage
Pesticide use
Product life
Product safety
Transport provision
Waste
Water use
Water pollution
Eco-labels can help consumers
and producers communicate
effectively about sustainability
issues and respond to them.
Consumers can use labels to find out
more about their purchases.
Labelling may help to raise
awareness about sustainability
issues in the wider population.
Producers can use labelling to
improve the image (and sales) of their
company. Wider use of labelling may
encourage producers to account for
the external effects of their production
methods in an effort not to be left
behind.
Eco-labelling may help to protect
the environment.
It is hard to measure the
effectiveness of eco-labels, as they
are closely connected to other
pressures on both producers and
consumers to adopt more
sustainable behaviours.
Environmental consciousness does not directly
affect purchasing behaviour. ''[C]onsumers’
preferences cannot simply be read off their
purchases in the market. At the moment of the
purchase decision, the label’s impact will depend on
how customers understand, trust and value its claim
in relation to other choice criteria.’
(Boer, 2003)
Voluntary
LABELLING
Businesses may choose to voluntarily label their
products if they estimate that the benefits (increased
sales/profits) exceed the likely costs (re-packaging/
process alteration/product reformulation etc.) Often,
however, rival businesses choose to collaborate
rather than compete, and avoid labelling to lower the
costs associated with meeting SD criteria.
Consumers can be sceptical and may not trust
voluntary labelling, often doubting its value, which
can lead to firms having little incentive to label.
3rd Party Certified
3rd party certification increases the reliability of a
label in the eyes of the consumer.
An external body provides standard-setting, testing,
certification and enforcement, and the company
pays them for the ability to use the label on their
product(s).
Often smaller business cannot pay for the
certification, which can cause them to lose out on
business and damage their long-term viability.
Current labelling schemes were analysed to see what
could be learned. Other than the Carbon Reduction
and Traffic-Light labels, the majority of schemes were
very similar in their criteria and judging methods, but
often used varying language, causing confusion
among consumers. It is important for specific terms
(e.g. organic) to be legally defined, so claims can be
both standardised and differentiated for clarity.
Carbon Reduction Label
This label is fairly unique in
allowing producers to make a
claim about their current
carbon emissions, as well as
pledge to work on lowering
them in the future. It comes
with very specific instructions
as to how carbon
emissions are to be measured, and
could be used as part of, or even
provide a model for, a generalised
sustainability labelling scheme.
Mandatory
CURRENT
LABELLING
SCHEMES
Mandatory labelling can be enforced by government
or policymakers to try to ensure consumers have
enough information about their purchases, or to
move the population towards sustainability targets.
Labelling is a short-term solution to problems which
are difficult to regulate due to opposing interests,
and can smooth the path for regulation.
LABELLING ISSUES
Traffic-Light / Signpost Label
This label, as used by supermarkets such as Sainsburys, shows
not only the absolute value of each
nutrient in the product, but also an
indication of whether this is high,
medium or low in a format which is
understood at a glance. Some labels also give the
percentage value of your recommended daily amount
found in one portion of the item. The simplicity of this
from a consumer’s perspective makes it almost an
ideal model for a sustainability labelling schemes.
FINDINGS: Labelling is a highly effective tool for communicating the SD criteria of food
products, provided it remains transparent, is kept up-to-date, and is easily understandable to
the consumer. Standardisation of methodology and consumer education are essential if
consumers are to participate, through market choices, in developing a viable food production
and labelling process. However, this will be time-consuming, and mandatory changes are
likely to be highly controversial.
The development of a single label to transmit to consumers a simplified measure of a product’s
‘sustainability’, similar to Traffic-Light Labelling, is an ideal solution, but given the number of
SD criteria involved this is again likely to be a lengthy and complicated process.
Labelling does not solve the ultimate problem - that we are consuming too much too fast - and
will not be enough to achieve sustainability goals if it is not supported by other, and more
vigorous, individual, social, and governmental action on consumption patterns.
Trade
Domestic interests dominate, which
can lead to a lack of transparency
and discriminatory effects in
standard-setting, and a loss in
competitive advantage for foreign
producers due to raised costs of
production.
Innovation
The criteria use in labelling schemes
are set around products and
technologies as they exist today,
discouraging new innovation which
may not meet required criteria.
Market Inefficiencies
Labels may distort prices and other
relevant information used by
consumers when selecting
products, which can lead to a poorer
allocation of resources and market
inefficiencies.
Research by Rebecca Petford
(Sustainable Development Undergraduate)
Supervised by Professor Jan Bebbington
(School of Management)
Research funded by the
Undergraduate Research Internship Programme