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New Eco-label Disclosure Project To Examine “Green” Claims

What goes on behind the scenes of the different eco-labels? A new survey from WRI and Ecolabelling.org will find out.

A surge of competing eco-labels and product certifications has many consumers and businesses concerned about “greenwashing” – exaggerated or misleading claims about eco-friendliness. Recently, the Federal Trade Commission filed complaints against companies accused of making false green claims about “bamboo” fabrics (actually made of rayon) and falsely labeling products as “biodegradable.” But with over 350 eco-labels promising to monitor everything from fisheries to dishwashers, and with little to no oversight, it can be difficult to know what, if anything, these stamps of approval really mean.

The World Resources Institute, as part of its Green Supply Chain project, has partnered with Big Room Inc.'s ecolabelling.org to survey eco-labels’ practices and promises. Here are answers to some of the essential questions:

What is the goal of the new survey from WRI and Ecolabelling.org?

The purpose of this project is to increase the transparency of the different eco-labels, and provide information on what makes an eco-label credible. We are surveying 355 different labeling organizations and looking at their governance structures, the stakeholders involved, and the content of their criteria. We will also look at the labels’ impact assessments to evaluate whether they can actually monitor and validate their labels’ claims, and whether those claims are independently verified. By showing what is behind the scenes of the different labels, we can help consumers make more informed choices and encourage the use of reputable labels.

What have been some of the problems with eco-labels so far?

There have been so many eco-labels introduced in the past few years, and this has led to a lot of confusion. There’s no consensus definition of what "eco" or “green” really means. Eco-labels cover different issues and that can be confusing. In some cases labels have backfired – rather than making consumers more confident in their purchases, they are actually becoming more skeptical and disenchanted with labels. I think you’ve seen less adoption of “green” purchasing as a result.

What kind of oversight is there for eco-labels?

At this point there's very little oversight of the different eco-labels and the claims they make, and there is quite a lot of “creativity” in applying label-like logos to make various green claims that are not backed up by data or any external review. The FTC and the SEC are increasingly turning their attention to green claims, and Senator Dianne Feinstein has been developing legislation around eco-labeling as well. There’s more focus on the issue now, but currently it’s the Wild West.

Buyers need to understand which eco-labels are really addressing the environmental or social risks within their supply chains.

What makes a good eco-label?

It depends on your perspective. For NGOs, credibility is very important. Can this label really back up the claims it is making? From the EPA perspective, the environmental impact is important – is the label helping to change unsustainable practices? For businesses, a good eco-label is one that consumers recognize and trust and therefore use to inform their buying decisions. Businesses also want a label that can effectively monitor a broad enough range of suppliers in order to keep up with demand from mass manufacturers and marketers. Does the label have the capacity and governance structure that would allow it to scale up? These are the types of questions we will be getting at in the survey and subsequent work.

How can strong eco-labels help institutional buyers?

Institutional buyers want certainty in their supply chains in order to keep their business running smoothly. Buyers who, for example, might be responsible for purchasing wood products or other natural resources for their company need to understand which eco-labels are really addressing the environmental or social risks within their supply chains and which are accepted by a wide variety of stakeholders. Good eco-labels can help them keep track of what their suppliers are doing and help ensure that suppliers are using best practices to protect the viability of these resources over the long term.

For more information, please contact:

Trevor Bowden, Big Room Inc., trevor@bigroom.ca
Jeff Rodgers, World Resources Institute, jrodgers@wri.org

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