A Consumer Perspective

Norm Crothers

Technical Development Manager, Australian Consumers' Association for the International Organisation of Consumers' Unions.

Importance consumers place on the environment

During the 1980s consumers have become more aware of the environment as a policy issue. Natural disasters and man-made disasters combined to heighten awareness. The depletion of the stratospheric ozone layer, although poorly understood by consumers, probably made more difference to interests and attitudes - especially in countries close to the Antarctic "hole".

Earlier oil shocks and energy crises added their uncertainties to a comfortable consumer world. Energy efficiency measures introduced in the 70s and 80s, although targeted to practical sustainability and national security and, of course, trade balances, were backed by environmentalists for other reasons. Consumers became aware of the environmental dimensions to some more aspects of their consumption and behaviour.

Regular surveys, or opinion polls, through the 80s and 90s have shown increasing awareness by consumers and increasing stated willingness to modify behaviour to reduce environmental impacts.

Various product marketers capitalised on these trends to develop marketing strategies and product labelling claims. Initial high success indicated a willingness by many consumers to actually purchase by these claims. When many of these claims were lately shown to be false or misleading there was a significant reaction by consumers. Marketers have been far more cautious lately.

Importance of information in the market place

The market works by information. This comes from various sources. The marketer of goods is obviously one key information provider. Governments and NGOs are other key players. Independent consumer organisations developed world wide on the basis of providing market assistance information. Environmental NGOs have also provided more broad information that also influences market behaviour.

It is essential for a market to work well that information is appropriate and correct. Codes of conduct and fair trading laws exist in most countries to regulate some of the information in the market. There are many examples of mislead-

ing claims and misleading endorsed labelling programs. A high risk exists that consumers may be mislead - even unintentionally. Fair trading laws have been used with some success against misleading claims. How to protect consumers who are confronted with a highly complex and government endorsed scheme is more difficult.

Labelling programs provide a very specific form of consumer information, usually relating to certain limited aspects of a products performance or safety. These include food contents, origins, electrical safety and so on. Environmental claims or eco-

labelling schemes may seek to be equally as narrow or very broad - single criteria or life cycle based. Consumers have become rather cynical about single criteria schemes in many places where they have been tried.

A possible exception has been energy labels on appliances. Although introduced for various reasons as noted above due to sudden changes in energy markets these programs may be environmental in impact and are now sometimes promoted that way. For many consumer products their main impact will be due to energy in use and so an energy consumption label may be a surrogate for environmental impact labelling.

Consumers choose products by a variety of criteria. Energy use or environmental impact may not be prime considerations even for a genuinely concerned consumer. Price is usually very high on the list. The product must still achieve its purpose satisfactorily and be safe. It must fit into the space allocated to it. It must be reliable. For many consumers only after these essentials have been met will environmental factors be considered. For other consumers specific environmental or other social factors will be first considerations - for example CFCs, dolphin safe tuna, no phosphate detergent.

Recent moves to LCA based labelling in Europe, the US Green Cross and globally through ISO standardisation may help consumers accept the meaningfulness of labels. Consumer and other NGOs will support and promote good labelling programs based on LCAs.

Energy labeling has been moderately effective in many places where it has been used. It is uncertain how much this is due to consumer choice and how much it is due to the manufacturers' concern for market images. Moves to minimum energy performance standards in some countries where labelling has had some success may reverse that trend. Manufacturers tend to meet standards rather than exceed them if there is no 'prize' for doing so.

How can consumers be confident in information and labelling programs

Transparency in establishing programs is essential for community support. The purpose in operating a labelling program at all is to change (some) consumer behaviour and hence to improve products' environmental performance and manufacturing's environmental performance. If the labelling program is not appropriate or not credible it is less likely to achieve these objectives.

Participation by NGOs is essential. NGOs can and will promote good schemes and draw in broad community support. NGOs which are genuinely independent can verify the appropriateness of schemes. given so the purpose and structure and development of a scheme must be laid out openly and clearly. Schemes need to be as flexible as possible so that change can be taken on board where needs change or market or other failures are found. Failure to change when the community sees a need will be most damaging.

If consumers can see the basis of the scheme and be represented and consulted then the scheme is both likely to be appropriate for them as well as supported and used.

Regional and Cultural differences and internationalisation

Consumers and consumer groups want to see a broadening of trade as it leads to a greater variety of goods and potentially better prices. Even where labelling or other similar technical requirements are not onerous they still add costs if they are peculiar to a country or region. Competitors entering a market face higher than expected start up costs and overheads in complying with labelling schemes.

We would like to see a truly international ecolabelling program. However it may take considerable time for the ISO route to produce this. Also the ISO system does not provide for adequate community representation. Some ISO member country/organisations do more than others to incorporate consumer and environmentalist inputs by access and funding. Others do not. Community representation needs support and funding to be viable.

Unfortunately there are very real regional differences for environmental impacts and in the way in which product preferences are apparent and in consumer behaviour with these product choices.

For example, a life cycle analysis of a product's impacts on the environment must take into account many things, some of which are uni-versal and some of which are particular to source. Aluminium refined by coal fired electricity has an innately different impact than aluminium refined by hydro-electric power. So you cannot just take aluminium content as standard factor in an LCA. Similarly, energy in use may be the most important environmental factor for a consumer product where coal fired electricity is used but not where alternative sources prevail.

Regions exhibit cultural differences (which may also be due to environments of course) so that the European ecolabelling criteria for clothes washing machines includes an evaluation with a 60°C wash cycle. However, in North America, East Asia and Australia/New Zealand consumers seldom if ever do this. Hence the European criteria would neither represent the best environmental effect nor would it be credible and supported in these regions.

Ecolabels and criteria need to be more flexible if they are to assist and not hinder trade. Where we can identify regional differences we should be aiming to have alternate scales or clusters of ratings or criteria on labels so that consumers can choose what is appropriate for their behaviour and manufacturers can provide one set of test or analysis data for all (or most) markets.

This is obviously a challenge. The decisions taken in regard to present labelling programs were just as much a challenge and obviously reflect compromises and trade-offs. A cleverly developed flexible scheme may in fact be less challenging to some interests as it can be promoted differently in different regions without conflicting with local norms and needs.

Roles for consumer movement

The international consumer movement is very ready to play a role in harmonising these matters. The world movement and its member national bodies and regional groupings have substantial technical and policy skills and a special understanding of consumer needs. This movement can provide unique support for a good program.

To achieve this there needs to be a structure provided which facilitates community input both at national and global levels. IOU has not yet developed its policy positions on eco-labelling and LCA but it would like to do so in appropriate consultation with other relevant international bodies, including the OECD.

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