The Sustainability Challenge Is Complex. Is Ecolabelling the Answer or Just Another Greenwashing Tool?

by Idris Mootee on 29 October, 2009 - 22:02

No one will disagree that today’s customer is empowered like never before. With social media and other connectivity, they are able to acquire more detailed information about brands, products and services in order to make smarter decisions; everything is just a few clicks away. Any green-washing or eco-washing can last only for a few clicks. Customers can access new knowledge about the behavior of companies and can more readily question and challenge this behavior.

Many CSR initiatives are of limited success. It is pretty simple, for a retailer to have some green products available as a choice is worse than not having them. If they are doing what they are supposed to do, there would be no reason for greenlabels in the first place. Because everything should be green. For a shoe company to offer 10 green SKUs over 3000 total designs, it is not acceptable at all. No surprise that many retailers struggle with green as consumers ask the question if it makes sense given what may be construed as a conflict of interest—what retailer wouldn’t want to label every product on its shelves with a green label to make it sell faster? I think what they should do is a big sign showing what percentage of products are becoming green and the index should move upwards until more than 90% of products are green to a reasonable level.

Taking a deeper look many retailers' eco programs may not be too effective—the Home Depot’s Eco-Options, Staples’ EcoEasy, and the Office Depot Green Depot. Is ecolabeling the answer? There is a much needed gap here as no one really knows what qualify as “green”. It is too complicated to just label a product’s degree of greenness. Some are pushing a bill which would empower the Federal Government to create a multi-attribute eco-label much in the spirit of the ecolabels generated by 25-plus other countries in the world.

Walmart is developing a universal rating system to help consumers determine which products are truly sustainable. The rating system would scrutinize a product's entire life-cycle by focusing on broad factors, rather than the usual marketing gibberish that extolls isolated virtues.

For the index, here are three examples. the most common one covers four main areas, including: 1/ energy and climate 2/material efficiency 3/ natural resources, and 4/ people and community. Nike's sustainability group has developed a framework or index (see photo above) which they use for product design that includes 1/ environmentally preferred materials 2/ waste 3/ solvents, and 4/ innovation (see photo). At Idea Couture, we use a slightly different framework (see photo below) to evaluate product innovation which also included social and transport footprint as those are sometimes ignored. It is a little more effective as we take into consideration the supply chain impact as well as the job creation or other social impact.

Ecolabelling is useful in a limited way but still a big step forward, at the end of the day the most potent sources of credibility and purchase influence comes from the voices of consumers amplified through social networks. Transparency is still a long way until we have full access to process classification, ingredient classification and disclosure, and access to the farmers growing whatever the raw material. In the end, the power may rest with the people and the Twitterverse.

Original Post: http://mootee.typepad.com/innovation_playground/2009/10/no-one-will-disagree-that-todays-customer-is-empowered-like-never-before-with-social-media-and-other-connectivity-they-c.html