Consumer empowerment: Helping shoppers to buy green [Archived]

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This article is part of our special report Products for a greener planet.

As pressure mounts to lead sustainable lifestyles, policymakers and companies alike are mulling new ways of encouraging shoppers to buy green. But consumer groups warned against confronting shoppers with too much information and warned that companies' green claims are often not independently verified. 

The European Commission wants to convince consumers that making an effort to protect the environment can benefit their pockets as well as the planet.

In 2012, the EU executive is planning to table policy recommendations on consumer empowerment in the EU, which are expected to focus on product labelling.

Private housing and transport have been singled out in Brussels as areas where consumers can help to protect the environment.

Consumers can contribute by insulating their buildings or installing solar panels or requiring electricity produced by renewable energy sources. They can also change their fuel-powered cars for electric ones or turn to energy-efficient heating systems and appliances. 

But with growing numbers of companies touting a wide variety of green claims, consumer groups warn that it is becoming increasingly difficult to know who to trust.

And in any case, many simply cannot afford the luxury of buying 'green' products which often tend to be more expensive.

More generally, others warn that consumers should not be expected to take all the responsibility as they may lack the time or the motivation to check all the information made available to them.

European policymakers are increasingly looking at ways to empower consumers to change their shopping habits in a bid to encourage more sustainable lifestyles.

A preferred route is to give consumers the tools they need to make more environmentally-friendly choices.

For many consumers, the perception that sustainable products are more expensive is perhaps the greatest obstacle to buying green.

European policymakers are increasingly looking at ways to empower consumers to change their shopping habits in a bid to encourage more sustainable lifestyles.

A preferred route is to give consumers the tools they need to make more environmentally-friendly choices.

For many consumers, the perception that sustainable products are more expensive is perhaps the greatest obstacle to buying green.

The European Commission acknowledges this. "Personal action can be expensive,"said EU Climate Action Commissioner Connie Hedegaard. "Not everyone can afford to buy a new car. Not everyone can afford to install new geothermal or solar systems; not everyone can afford to retrofit their houses with new insulation. Lower prices would of course increase demand, and thereby increase action,"

At the same time, she said, "if we consider the cost over a lifetime, there are huge savings to be made. With the right information, the consumer has the incentive to make the right choice," Hedegaard insisted.

"Therefore, it is important to further develop the market for sustainable products. There is money to be made and money to be saved for everyone," she said.

She was speaking at the 19th World Congress of Consumers International – an independent global umbrella group bringing together 220 national consumer organisations – held in Hong Kong in May 2011.  

Commission communication in 2012

To address these challenges, the European Commission is currently drafting a communication on consumer empowerment in the EU, provisionally timetabled for 2012.

"Markets, marketing, products and services become ever more complex and sophisticated. Consumers have difficulties to make informed choices and take the decisions that are in their interest," the Commission says.

"In this context, the communication's objective is to put together best practices on consumer empowerment with regard to information, education, media, representation and redress," it explains.

The communication, slated as a non-legislative act, will involve "identifying best practices in information of consumer rights, consumer advice provision, consumer complaint handling, consumer education and capacity-building, as well as development of guidelines on transparency price and quality/performance information".

Debate centres on eco-labelling, certification

Meanwhile, with Brussels policymakers debating new EU labelling rules, some consumer groups are warning that shoppers cannot always rely on labels if they want to buy sustainable products.

The seafood industry would appear to be a case in point. "Determining which seafood products are best for you and our planet can be a difficult job," warns Food & Water Europe, a pressure group.

"A number of private fish certification programmes boast reliable standards and labels to evaluate and market seafood as 'environmentally friendly' or 'sustainably produced', but what they don't tell you is at least as important as what they do, and that's where things get tricky for conscientious shoppers," the group says.

In May 2011, Food & Water published a new consumer guide to eco-labels in a bid to tell consumers exactly what they do and do not tell them about the fish they are eating.   

Many eco-labels analysed by the group were found to be inadequate with regard to environmental standards, social responsibility, community relations, labour regulations, international law and transparency.

Examples include the certification of flawed fisheries, the use of labels for marketing purposes and failure to consider carbon footprints in awarding labels.

Food & Water also claimed that many eco-labelling schemes fail to conform to FAO (Food and Agriculture Organisation) guidelines on transparency, damage mitigation from pollution, and contribution to rural development and food security.

"Consumers aren't told that these labels often have a 'pay to play' aspect," said Eve Mitchell of Food & Water Europe. "A well-managed fishery that can't finance certification may not have an eco-label and still be the best choice, while one that is less sustainable could be certified because someone paid for it."

As a result of this, labels can actually encourage consumers to buy less sustainable products, and it can be challenging for consumers to decipher whether labels are very meaningful," Mitchell said. "To us this is getting very close to actually misleading consumers, which must be dealt with officially," she claimed.

Food & Water is calling on the European Commission to expand the information required on seafood labels to improve clarity and make sure that FAO guidelines are understood and enforced.

Business scramble for sustainability

Businesses will also have a key role to play in making sure that there are sustainable paths available for consumers to take. 

Multinational giants are getting in on the act as they look to convince environmentally-conscious customers that shopping with them is a sustainable choice.

Examples are numerous, according to Commissioner Hedegaard.

"Nike collects used sport shoes to recycle them and re-use the materials for new sporting shoes. Through this measure and a range of other energy-reducing measures in its factories and offices, Nike has brought down its emissions by millions of tonnes," she said.

By 2020, the Anglo-Dutch multinational Unilever is aiming to help more than a billion people take action to improve their health and well-being, and to decouple its growth from its environmental impact. "A more sustainable brand is often a more desirable brand," the company says.

Its 'Sustainable Living Plan' focuses on three main areas: health & well-being; the environment; and enhanced livelihoods.

The idea is to drive consumer preference. According to Unilever, "consumers around the world want reassurance that the products they buy are ethically sourced and protect the Earth's natural resources".

"Delivering these commitments won't be easy. To achieve them we will have to work in partnership with governments, NGOs, suppliers and others to address the big challenges which confront us all," says Unilever CEO Paul Polman.

"Ultimately we will only succeed if we inspire billions of people around the world to take the small, everyday actions that add up to a big difference – actions that will enable us all to live more sustainably," he says. 

Unilever is aiming to halve the greenhouse gas impact of its products across their lifecycle by 2020, halve the water associated with consumer use of its products by 2020, and halve the waste associated with the disposal of its products by 2020.

It is also aiming to source 100% of its agricultural raw materials sustainably by 2020, and to link more than 500,000 smallholder farmers and small-scale distributors into its supply chain by 2020.

Helping consumers to make 'conscious choices'

Ultimately, though, in a society where speed and convenience is everything, the ability of many consumers to make green choices will depend on the products stocked by their local supermarket.

The Commission is looking at ways to help environmentally-conscious consumers to shop in the right places.

Consumers can reduce their CO2 emissions as they go shopping. They can buy local vegetables instead of vegetables that are flown in from overseas, and they can refrain from eating meat everyday.

"There is 10 times more energy needed for producing meat and dairy than for local fruits and vegetables. Many consumers do have a choice and they can make a conscious choice," Hedegaard said.

Some supermarkets have stopped offering their customers free plastic bags, opting to sell larger reusable bags instead. Others continue to offer small plastic bags but only for a small fee.

"Do you use plastic bags or re-usable shopping bags? The average plastic carrier bag is used for five minutes, but takes 500 years to decompose," said Hedegaard.

"The products are there. Let's go for another lifestyle where it's cool to use less, cool to downsize," she added.

Reducing food waste

Food waste is another huge issue. "How much food do you throw away? An EU study shows that households throw away 89 million tonnes of food per year: that's about a quarter of what we buy. And 60% of that food waste could be avoided. This is indeed also a moral responsibility," the commissioner said.

She cited fishing as an example of an industry in which consumer choices can have a positive impact on the sustainability of the sector.

In the year 2000, the world's fishing fleets burned 43 million tons of fuel to catch 80 million tons of fish. Catching those fish required 12 times the amount of energy derived from eating them.

The Commission is urging consumers to check where fish comes from and how it is caught, and reminds shoppers that some species like squids and clams are less endangered and less energy intensive to catch.

Breaking down barriers to green consumption

Despite encouragements to buy green, consumers often struggle to identify which products are truly respecting the environment. Given the huge amount of advertisements out there it would be easy to believe that almost all products are green. But it is hard to be certain which ones truly are.

Providing complete and trustworthy information contributes to empowering consumers and allows them to make deliberate and informed choices in favour of green products.

Lack of trust is another problem. Consumers cannot tell whether a company's green credentials are accurate or not.

Indeed, a survey carried out by Consumers International in 2007 showed that only 10% of the interviewees trusted the information given by companies.

It falls to governments and consumer organisations to provide credible information and help educate consumers if they are to be empowered and motivated them to embrace a more climate-conscious lifestyle.

Governments will in fact play a crucial role in stimulating the development of well-operating markets for green products, for example by tabling legislation on labelling requirements and tax incentives or by increasing taxes on excessive food packaging.

The European Commission wants public authorities to systematically apply high-energy efficiency standards when they purchase ICT equipment and energy services, and when they retrofit public buildings. It is urging governments to exchange experiences in this regard.

In the UK, the government has published a Green Claims Guide to help consumers to identify misleading claims and real green products, while in Denmark, the consumer ombudsman has drawn up criteria against similar such 'green washing'.

Governments have also introduced different eco-labels and energy-efficiency labels for energy-using products, giving consumers precise information on the energy consumption of the product they are purchasing.

In Europe, energy labels have also been introduced at EU level, where A+++ is the most efficient and G is the least-efficient. The letters correspond to certain energy efficiency criteria which are fixed by law, and they are displayed on everyday items like fridges, televisions, washing machines and dishwashers.

Figures quoted by the European Commission suggest that 85% of consumers rank energy efficiency above price as a purchasing criterion.

"Energy efficiency labels do work. They are an incentive for producers to improve their appliances' energy performances," says Commissioner Hedegaard, citing as an example the introduction by the EU of energy labels for fridges in 1995, which saw the percentage of fridge-freezer combinations in the energy class 'A' raise from 2% then to 90% today.

A similar EU-wide labelling scheme was recently introduced for car tyres. The labels indicate the fuel efficiency, wet grip and rolling noise performance of tyres. 

Many European countries have introduced market-based instruments to encourage investment in energy-efficiency improvement and achieve national energy savings targets.

For example, consumers who live in the Brussels-Capital Region receive a subsidy worth up to 50% of the product's value when they purchase white goods like fridges, freezers and tumble driers with an A++ rating.

Meanwhile, Germany, France and Portugal UK are among countries that have introduced car-scrapping schemes that have proven hugely popular with consumers.

In Germany, motorists who trade old cars for new ones receive a 2,500 euro bonus, while France and the UK have jointly spearheaded efforts to reduce VAT rates for cars, efficient light-bulbs and other consumer products that are less environmentally-damaging. 

Green claims not always trustworthy

With growing numbers of companies touting a wide variety of green claims, it is becoming increasingly difficult for consumers to know who to trust.

"Europeans are faced with a growing amount of misleading green information in all areas of daily life: food and drink, cosmetic products, cars, electricity offers or electric household appliances," Monique Goyens, director-general of European consumers' organisation BEUC, told EURACTIV.

Goyens cited the widespread use of the word "bio" as part of the brand name for cosmetic products, or exagerrated reference to "natural" despite the fact that the cosmetics are not organic, as examples. "We also find green leaves on packaging even though nothing of the kind appears in the ingredients list," she said.

"Green labels on retailers' own brands are multiplying, but their criteria are rarely transparent or comparable. Only independent, third party-tested labelling schemes, such as the EU Ecolabel, are reliable," said Goyens, declaring that regulation had become "a must" given the proliferation of exaggerated claims. 

Indeed, advertising authorities have their hands full investigating the plethora of green claims that companies are making in their campaigns.

The UK Advertising Standards Authority recently banned an algae biofuel TV advert by oil giant ExxonMobil because it overstated the technology's climate change mitigation potential.

Similarly, Europe's biggest motoring consumer group warned that more transparency for consumers on the benefits of electric vehicles is urgently required, cautioning that current commercial and political pressures to present battery electric vehicles as 'zero emission' vehicles "are misleading for consumers".

For food products, the European Commission seeks to address this via the European Food Sustainable Consumption and Production Roundtable which brings together public authorities, retailers and producers.

Ultimately, the group is expected to adopt a "harmonised framework methodology for the environmental assessment of food and drink products," to be finalised by the end of 2011.

One of the major incentives for industrialists to participate in the group's work is the prospect of making green claims to consumers while avoiding accusations of 'green-washing'.

Social media and Internet as an empowerment tool

The ubiquity of the Internet and the popularity of new media mean that many young people no longer only use the information they can find on shop displays when deciding which products to purchase.

At the touch of a button, consumers can use their smart phones to access social networks, check their friends' experiences with a particular product or surf the Web to see how previous buyers rate it on online forums, rather than simply trusting the information provided in the shop.

"This opens up for new, smart ways of informing consumers," says Hedegaard, citing as an example an "eco-search facility" displaying product energy-efficiency information online.

"ICT […] could also be used to provide data on greenhouse-gas emissions of products, at the time and point of sale. The data could for instance be saved in the bar codes of products. This would also enable consumers to better monitor their personal carbon footprint," the commissioner suggests.

Indeed, many companies are already pursuing similar initiatives of their own accord.

US website rates the health, environmental and social performances of over 100,000 products. Its services are also available via an iPhone application.

In the UK, British Gas allows consumers to use their mobile phones to transfer gas meter readings to the company, meaning that bills are automatically adjusted to actual consumption. British Gas found that gas consumption fell by 12% among clients using this facility.

At EU level, Brussels is aiming to make sure that 80% of European consumers have smart meters in their homes by 2020.

Keeping a lid on expectations, changing mindsets

However, experts caution that consumer empowerment must not be seen as a panacea for the world's environmental problems.

In a recent interview with EURACTIV, Maja Göpel, from the World Future Council, was keen to sound a warning note. "We should not be fooled [into believing] that consumer choice can make our economies green: we are all working jobs and raising kids, etc.: occupations that simply do not give us the time to read and check and control all the information on the products out there," she said.

The issue of social justice is also problematic. Indeed, many consumers are simply not able to pay any higher prices for products.

This means that poorer sections of Europe's population cannot participate in 'greening demand' initiatives unless good 'greening supply' strategies are put in place to ensure equitable participation in markets, Göpel warned.

Despite the multitude of initiatives being introduced by governments and businesses alike, policymakers are quick to acknowledge that a huge change of values among populations is required if they are to prove successful.

Consumers must be convinced that it is worth taking action and participating in the transition to a greener economy.

"Once we have tackled the availability and the information problems, there is only one final hurdle left – the most difficult one. That is how to convince consumers to systematically buy sustainable products and services," warns Commissioner Hedegaard.

It remains to be seen how successful upcoming EU initiatives will be in this regard. 

"In the end, consumers have the power of the purse to decide whether they buy green products or not. So the support by consumer organisations will be key for implementing our climate policies in the next [few] decades," said EU Climate Action Commissioner Connie Hedegaard during a May speech to the Consumer International World Congress in Hong Kong.

"Providing complete and trustworthy information contributes to empowering consumers, so that they can make a deliberate choice – hopefully for green products," Hedegaard said.

"With the right information, the consumer has the incentive to make the right choice. Therefore it is important to further develop the market for sustainable products. There is money to be made and money to be saved for everyone," she added.

"We must use the power we have. As politicians, as businesses, as [consumer] organisations and as citizens, to make changes. We must understand that green is not just a slogan for environmentalists. It is a new way of organising our economies in order to provide good lives for nine billion people on this planet," the commissioner stated.

"Never has there been a greater need for green consumer organisations empowering consumers to make our growth green," she said.

"For 15 years, we have had a successful energy-labelling scheme. Adding extra categories and changing the colour coding to signify different things over time will not help to make consumers aware of the appliances with the lowest energy consumption. More generally, this new scheme will not have significant effects in directing markets to more energy-efficient products," Monique Goyens, director-general of European consumers' organisation BEUC, told EURACTIV. 

"No-one is enthusiastic about new energy labels and the European institutions should have the courage to admit their mistakes and go back to the drawing board," she added.

Regarding carbon footprinting, Goyens said consumer organisations were backing a cautious approach. "Most consumers would not be able to understand grammes of CO2 as a metric, particularly without being provided any benchmarks of whether the figure was high or low. Equally importantly, product carbon footprinting raises some fundamental methodological questions," she told EURACTIV.

"Green claims are very difficult to enforce, but we have evidence that they are actually declining, because companies are finding that they don't work. Consumers simply don't trust them," said Jacqueline Minor, head of consumer affairs at the European Commission's health and consumers department (DG SANCO).

"Growth at any cost is not viable. We have to develop new ways of doing business which will increase the positive social benefits arising from Unilever's activities while at the same time reducing our environmental impacts. We want to be a sustainable business in every sense of the word," says Unilever CEO Paul Polmer.

As consumers across the world become more conscious of environmental issues, companies are increasingly keen to tout their green credentials over those of their rivals.

Indeed, the eco-friendly nature of a product is now often a selling point in itself, explained Jan Muehlfeit, Europe chairman at Microsoft.

"As technology has become cheaper and easier to use, the demands of consumers have taken the lead in driving the market for personal computers, cell phones, tablets and online services," Muehlfeit said, adding that this trend was likely to continue as current and future generations of young people enter the job market.

"This is all part of a phenomenon called 'the consumerisation of IT', which is a driving force behind cloud computing," he concluded.

Wenonah Hauter, executive director of Food & Water Europe, said regarding misleading labelling of seafood products: "People often think that if they buy seafood with an eco-label, it's automatically a good choice. Unfortunately, these certifications don't assure that the product consumers are getting is actually eco-friendly, or that consumers are improving their behaviour."

"The most important measure for green demand is to get the prices to reflect all of their costs, including social and environmental ones,"said Maja Göpel, 'future justice director' at the World Future Council, calling for more price transparency.

"We see a lot of resistance on making costs transparent, even though it is the one single measure that is competition neutral and would lead to some form of effective consumer influence on production,"she told EURACTIV in an interview. 

  • 2008: EU tables proposals for a new Consumer Rights Directive.
  • Nov. 2008: European Commission conference on how behavioural economics can improve polices that affect consumers.
  • 15 Apr. 2010: Commission gives up bid to secure full harmonisation of consumer rights in Europe.
  • 22 Nov.2010: Commission conference entitled 'Behavioural Economics, so what: Should policymakers care?'
  • July 2011: Formal approval of Consumer Rights Directive by EU Council of Ministers.
  • Oct. 2011: Tentative date for publication of Consumer Rights Directive in Official Journal of EU law.
  • 2012: Commission to publish communication on consumer empowerment in the EU.
  • Before end 2013: Deadline by which member states must have fully implemented Consumer Rights Directive. 

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