Everything we buy has a life story. Our stuff is extracted from the earth, molded into shape, shipped across the world, used, and thrown away. Each step in this process has an environmental impact, whether it’s using natural resources to make the products or emitting pollution by transporting them. Businesses may be responsible for this impact by bringing products to consumers, but it’s consumers that ultimately drive the process. A lack of awareness about these hidden costs, and of useful information at the point of purchase, prevents consumers from becoming agents of sustainability.
Eco-labeling informs consumers about a product’s environmental footprint. In essence, it empowers them to vote with their dollar—rewarding companies that reduce their impact and pushing the rest to do the same. Eco-labels have to the potential to drive innovation in the products we buy and in the processes that make them if they’re properly designed and widely adopted.
So far, most eco-labeling efforts have relied on voluntary certification of particular products. Examples include EnergyStar for electronics, the Forest Stewardship Council for wood, and USDA organic for produce.
But the labels are gaining stream, encompassing ever more products and environmental impacts. Last year, international retailer Tesco slapped carbon emission labels on some of its products. The British government is considering a green labeling system for all the country’s food. And Japan has already started moving in this direction.
An ideal eco-label should convey all of the environmental and social impacts of a product across its entire lifecycle—from extraction and manufacturing to transportation, use, and disposal. These impacts should include greenhouse gas emissions, pollution, ocean acidification, ozone layer depletion, eutrophication (an increase in chemical nutrients in an ecosystem), habitat destruction, desertification, land use, and resource depletion. Design is key—to be effective, the label must be informative and intuitive enough to guide good choices without confusing shoppers.
Of course, labels require data, and data demands a lot of painstaking research. At present, most companies simply don’t know the environmental footprint of their products. Lifecycle assessments can be difficult to apply to goods with long supply chains, whose constituent parts may be manufactured by a dozen suppliers in as many countries.
Walmart, in an attempt to burnish its green image, recently announced an ambitious plan to develop a comprehensive sustainability index to measure the lifecycle environmental impacts of every product it sells. This could be a game changer.
The index is intended to stimulate a “race to the top” by helping consumers make informed decisions and cut through false eco-labeling, assisting Walmart to choose between suppliers, and even enabling manufacturers to identify areas for improvement.
A comprehensive sustainability index for all of Walmart’s products is still years away, however. So far, the company is sending out a 15-question survey to each of its 60,000 suppliers. The questions, which cover four areas—climate and energy, natural resources, material efficiency, and people and communities—refer to the company but not its products.
Eventually, every one of those manufacturers will have to dig its way back through its supply chain and measure the environmental impacts of its production processes and distribution systems.
Once the index gets off the ground, Walmart plans to turn it over to a nonprofit. The company partnered with universities and even competing retailers and set up a consortium to establish the tricky scientific standards needed to measure the sustainability of its consumer products. This is a gargantuan project that few other companies could take on, and Walmart is serious enough to make it open source. These steps signal that the company is in it for the long haul, despite the legitimate concerns of many environmentalists.
The world’s biggest retailer sells so many products that if these standards are indeed made “credible, transparent, and user-friendly” as Walmart hopes, and if other major retailers adopt them, it may usher in universal eco-labeling. This would go a long way to remaking the way we make things.